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Gladfelder v. Pacific Courier Services, LLC

United States District Court, Ninth Circuit

May 28, 2013

AMY GLADFELDER, Plaintiff,
v.
PACIFIC COURIER SERVICES, LLC and JAMES HOLMAN, Defendants.

Patrick L. McGuigan, HKM Employment Attorneys PLLC, Portland, OR, Attorneys for Plaintiff.

Christopher E. Hawk, Gordon & Rees LLP, Portland, OR, Attorneys for Defendant.

OPINION AND ORDER

MICHAEL H. SIMON, District Judge.

Two motions are before the Court. The first motion, brought under Fed.R.Civ.P. 12(b)(6), is Defendants' Motion to Dismiss Plaintiff's ninth claim for relief, which alleges a state law tort of wrongful constructive discharge. (Dkt. 11.) This motion was filed by both Defendants on January 22, 2013. One week later, on January 29, 2013, Defendant Pacific Courier Services, LLC filed for bankruptcy protection under Chapter 11 of the Bankruptcy Code (Dkt. 13-1), and on February 4, 2013, Defendants filed a Notice of Bankruptcy Case Filing, invoking the automatic stay as to Defendant PCS only. (Dkt. 13.) On February 5, 2013, Plaintiff filed her opposition to Defendants' Motion to Dismiss. (Dkt. 15.) On February 21, 2013, notwithstanding the automatic stay applicable to Defendant PCS, both Defendants submitted a joint reply in support of their motion to dismiss. (Dkt. 16.) Based on the automatic stay applicable to Defendant PCS, the Court will treat Defendants' motion to dismiss as having been made only by Defendant James Holman. That motion (Dkt. 11) is GRANTED. The second motion before Court is Defendant Holman's Motion to Stay Case until the automatic stay applicable to Defendant PCS has been lifted. (Dkt. 25.) That motion is DENIED.

BACKGROUND

Plaintiff, Amy Gladfelder, was employed as a staff accountant by Defendant Pacific Courier Services ("PCS") from September 7, 2011, until she resigned on June 28, 2012. First Am. Compl. ("FAC") at ¶¶ 4.3, 4.21 (Dkt. 6). Defendant James Holman is the sole owner and chairman of the board of PCS. FAC at ¶ 3.2. Plaintiff alleges that during her employment, Mr. Holman sexually harassed her and retaliated against her when she would not succumb to his inappropriate requests. FAC at ¶¶ 4.3-4.23. Plaintiff alleges that due "to sexual harassment, retaliation and hostile work environment, Plaintiff was forced to resign her position with PCS." FAC at ¶ 4.23.

Ms. Gladfelder asserts nine claims for relief based on Title VII of the 1964 Civil Rights Act, 42 U.S.C. § 2000e, et seq., Oregon employment laws, Or. Rev. Stat. ("ORS") Ch. 659A, and the Oregon state-law torts of intentional infliction of emotional distress, negligent infliction of emotional distress, and wrongful constructive termination.

As stated above, on February 4, 2013, Defendants filed a notice of bankruptcy case filing for Defendant PCS only. Dkt. 13. Accordingly, pursuant to 11 U.S.C. § 362, the action against PCS is stayed. In re Palmdale Hills Prop., LLC, 654 F.3d 868, 875 (9th Cir. 2011) (11 U.S.C. § 362 prohibits "continuing actions against the debtor that began or could have begun before the bankruptcy was filed[.]"). A bankruptcy stay, however, does not extend to solvent co-defendants. Fortier v. Dona Anna Plaza Partners, 747 F.2d 1324, 1330 (10th Cir. 1984) ("There is nothing in [11 U.S.C. § 362] which purports to extend the stay to causes of action against solvent codefendants of the debtor.").

DISCUSSION

A. Defendant Holman's Motion to Dismiss Plaintiff's Ninth Claim for Relief

Defendant Holman argues that Plaintiff's ninth claim for relief, alleging common law wrongful constructive termination (Plaintiff's "wrongful discharge" claim), must be dismissed because federal and Oregon statutory law provide an adequate remedy: "Plaintiff's wrongful discharge claim[] fails because Title VII and ORS Chapter [6]59A provide adequate statutory remedies for her retaliation claims." Defs.' Mem. at 3 (Dkt. 12). Plaintiff responds that federal and Oregon law do not provide for an adequate remedy. Pl.'s Opp'n at 4-7 (Dkt. 15).

The parties agree, however, that if "existing remedies adequately protect the employment related right... the Oregon Supreme Court has usually chosen not to recognize an additional common law remedy of wrongful discharge." Carlson v. Crater Lake Lumber Co., 103 Or.App. 190, 193, adhered to as modified on recon., 105 Or.App. 314 (1990). Based on Carlson and Holien v. Sears, Roebuck & Co., 298 Or. 76 (1984), Plaintiff argues that federal and Oregon statutory remedies do not adequately protect employees from sexual harassment. In these two cases, the Oregon Court of Appeals and the Oregon Supreme Court, respectively, held that state and local statutory remedies "fail to capture the personal nature of the injury" when an employee is wrongfully discharged for resisting sexual harassment. In Holien, the Oregon Supreme Court explained:

ORS 659.121 and Title VII fail to capture the personal nature of the injury done to a wrongfully discharged employe[e] as an individual and the remedies provided by the statutes fail to appreciate the relevant dimensions of the problem. Reinstatement, back pay, and injunctions
vindicate the rights of the victimized group without compensating the plaintiff for such personal injuries as anguish, physical symptoms of stress, a sense of degradation, and the cost of psychiatric care. Legal as well as ...

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