$2.16 Million Defamation Verdict Is Voided On Appeal
Hearn v. Pacific Gas & Elec. Co., 108 Cal. App. 5th 301 (2025)
In this case, the Court of Appeal reaffirmed the principle that an employee's tort claim is not separately actionable against an employer when it is premised upon the same conduct that gave rise to the termination of employment and where the damages sought are solely related to the loss of employment. The Court relied upon case law going back as far as Foley v. Interactive Data Corp., 47 Cal. 3d 654 (1988), which delineates the ability of an employee to recover tort damages.
Todd Hearn went to trial on claims for (1) retaliation in violation of section 1102.5 of the California Labor Code and (2) defamation. Hearn's former employer (PG&E) terminated Hearn based on findings from an investigation into various violations of the employee code of conduct. At trial, the jury found against Hearn on the retaliation claim but found in his favor on the defamation claim, awarding him $2.16 million in compensatory damages. The jury specifically found that the investigative report that resulted in Hearn's termination was the source of the purportedly defamatory statements. PG&E moved for JNOV on the ground that Hearn had conceded that his damages for the alleged defamation were simply his termination-related damages - i.e., that he had suffered no distinct reputational harm or other damages specifically attributable to the allegedly defamatory conduct. The trial court denied PG&E's JNOV motion.
In a 2-to-1 ruling, the Court of Appeal reversed the trial court's judgment entered in Hearn's favor on the defamation cause of action, agreeing with PG&E that Hearn could not pursue a tort claim against PG&E based on the same conduct and seeking no distinct damages from his unsuccessful wrongful termination claim. In so ruling, the Court reaffirmed the long‑standing principle against an employee bringing a duplicative tort claim against an employer which is simply a wrongful termination claim by another name.
USPS Employee's Hostile Work Environment Claim Can Proceed
Lui v. DeJoy, 129 F.4th 770 (9th Cir. 2025)
Dawn Lui, the former postmaster of the United States Post Office in Shelton, Washington, alleged she was targeted because of her race, sex and national origin. Lui alleged disparate treatment and retaliation in violation of Title VII. The district court granted summary judgment to the Postmaster General, but the Ninth Circuit reversed in part, holding that Lui's disparate treatment claim should not have been dismissed. The Court concluded that Lui had satisfied the McDonnell Douglas test for establishing a prima facie case by showing she was removed from her position as Postmaster, demoted and replaced by a white man. The Court further held that there is a genuine dispute of material fact about whether the decisionmaker's decision to demote Lui was independent or influenced by a biased subordinate and that Lui had properly exhausted her administrative remedies. As for Lui's claim of retaliation, the Court affirmed summary judgment on the ground that Lui failed to establish a causal connection between any protected conduct and the demotion decision.
Employer Did Not Violate FEHA By Denying Employee Disability Retirement Benefits
Lowry v. Port San Luis Harbor Dist., 109 Cal. App. 5th 56 (2025)
John Lowry was employed as a harbor patrol officer before suffering a permanently disabling...
