>SANDELL v.
TAYLOR-LISTUG, INC



















Filed 9/7/10











>CERTIFIED FOR PUBLICATION





COURT
OF APPEAL, FOURTH APPELLATE DISTRICT



DIVISION
ONE



STATE
OF CALIFORNIA






>

ROBERT SANDELL, Plaintiff and Appellant, v. TAYLOR-LISTUG, INC., Defendant and Respondent.

D055549 (Super. Ct. No. 37-2008-00064342- CU-OE-EC)

APPEAL from a judgment of the
Superior Court
of San Diego
County, Laura W. Halgren, Judge. Reversed and remanded for further
proceedings.



Eisenberg
& Associates, Michael B. Eisenberg and Joseph S. Socher for Plaintiff and
Appellant.

Luce,
Forward, Hamilton & Scripps, Charles A. Bird and Aaron T. Winn for
Defendant and Respondent.

I.

INTRODUCTION

Plaintiff
Robert Sandell appeals from a judgment entered after the court granted summary
judgment in favor of defendant Taylor-Listug, Inc. (Taylor-Listug) on Sandell's
claims for disability and age discrimination. Sandell was employed as vice-president of
sales at Taylor-Listug, a guitar manufacturer, from 2004 to 2007.

Approximately
six months into his employment at Taylor-Listug, Sandell suffered a stroke
after receiving a chiropractic adjustment.
Sandell returned to work at Taylor-Listug in late 2004. During the remainder of Sandell's employment
at Taylor-Listug, he required a cane to walk, and his speech was noticeably
slower than it had been prior to his stroke.
Taylor-Listug's chief executive officer terminated Sandell's employment
in late 2007, a few days after Sandell's 60th birthday, citing displeasure with
Sandell's performance as vice president of sales .

The trial
court concluded that there were no triable issues of fact with respect to
Sandell's discrimination claims, and granted summary judgment in favor of
Taylor-Listug. Having reviewed the
record presented on summary judgment, we conclude that Sandell presented
evidence sufficient to establish a prima facie case of disability and age
discrimination, and in response to Taylor-Listug's proffer of legitimate
nondiscriminatory reasons for terminating his employment, Sandell presented
sufficient evidence to raise a triable issue of fact as to whether the
motivation for his termination was discriminatory. We therefore reverse the judgment of the
trial court and remand the matter for further proceedings.

II.

FACTUAL
AND PROCEDURAL BACKGROUND

A. Factual background^[1]

Taylor-Listug,
also known as Taylor Guitars, is a manufacturer and wholesaler of acoustic
guitars. Kurt Listug, one of the
founders of Taylor-Listug, is chief executive officer of the company. Another founder, Robert Taylor, serves as the
company's president.

Listug met
Sandell at the National Association of Music Manufacturers' convention in
January 2004. Sandell had 30 years
experience in the music business. After
inviting Sandell to interview at Taylor-Listug, Listug hired Sandell as senior
vice-president of sales at the company.
Sandell reported directly to Listug.


Listug
hired Sandell, at least in part, because Sandell had experience with territory
management, a practice that Taylor-Listug wanted to implement. As Listug explained, "Territory
management . . . is tools for being able to set quotas by
territory, region, town, et cetera. It
has to do with looking at the buying power, you know, throughout the country
and overlaying your sales targets over that, coming up with sales targets for
your salespeople. [¶] [P]rior to [Sandell], none of us – none of
the people in sales had any experience with that."

Sandell
started working at Taylor-Listug as in February 2004. In June 2004, Listug began a six-month
sabbatical from his work at the company.

In August
2004, Sandell received a chiropractic adjustment from a chiropractor who was a
friend of Taylor's, and with whom
the company contracted to treat its employees.
The following day, Sandell began to feel ill. Sandell's health continued to deteriorate
throughout that day, and he eventually went to the hospital. A neurologist diagnosed Sandell as having
suffered a stroke. According to Sandell,
the neurologist said that she had seen other patients who had suffered a
similar type of stroke after receiving chiropractic adjustments.

Sandell
remained in the hospital for several weeks after the stroke, and then
recuperated at home for several more weeks.
Sandell returned to work on a part-time basis in October 2004. He was working full time by December 2004.

After the
stroke, Sandell had difficulty with his balance and strength, and also had
difficulty talking. Because of his
balance problems, Sandell needed a cane to walk when he returned to work. His speech was also noticeably slower than it
had been prior to the stroke.

Sandell testified
in his deposition that not long after he returned to work, "[Listug] came
in my office . . . and closed the door and said that if I
didn't make a full recovery, that the company had the right to fire me or
demote me and reduce my salary."
Sandell also said that Listug questioned Sandell's use of a cane,
suggesting that Sandell was using the cane to create sympathy or to get
attention: "[Listug] called me to
his office after one of our regular or routine sales meetings, and he asked me
when I was going to get rid of the cane and when I was going to drop the
dramatization." Listug also told
Sandell that he wanted Sandell to "be more of a cheerleader type of
personality in the sales department."
Sandell testified that this is not what Listug had told Sandell when
Sandell started his job at Taylor-Listug, but rather that Listug's desire for
more of a "cheerleader type" had apparently developed sometime later.

The parties
disagree as to the meaning of the data pertaining to Taylor-Listug's guitar
sales during Sandell's tenure as vice-president of sales. However, it is undisputed that in 2004 – a year during which both
Sandell and Listug spent significant periods of time not working – sales of Taylor-Listug
guitars decreased for the first time in 20 years. Taylor-Listug's total sales increased in
2005, may have decreased in 2006, and increased again in 2007.^[2] Taylor-Listug cites various statistics
related to these numbers to argue that Sandell's sales management was
ineffective. Sandell responds by noting
that during his years at Taylor-Listug, the company's market share increased in
a number of key markets, and that although the company did not see overwhelming
sales growth during that period, the market for guitars, in general, suffered. Sandell presented evidence that, according to
data from the Guitar Accessories Marketing Association, sales growth in the
guitar market slowed dramatically from 2004 to 2005, and decreased
significantly in both 2006 and 2007. Sandell
argues that when viewed in the context of a slowing overall market,
Taylor-Listug's sales numbers were actually quite good.

Sandell
also presented evidence that he introduced new practices to the Taylor-Listug
sales department, such as analyzing each sales area's buying power index in order
to determine how many sales the company should expect from a particular sales
area. Other practices that Sandell
initiated at Taylor-Listug included regular territory reviews with each area's
account manager; a new incentive program for sales staff to encourage growth; a
"minimum advertised price" policy, pursuant to which dealers would
not be permitted to advertise Taylor-Listug products below a certain price set
by Taylor-Listug; and increased travel expectations of sales staff pursuant to
which sales personnel would visit the dealers in person for approximately two
weeks per month, rather than relying on telephone contact, as had been the
practice prior to Sandell's arrival.

During his
employment at Taylor-Listug, Sandell received three annual reviews ─ one
in 2004, another in 2005, and a third in 2006.
The Taylor-Listug performance review document includes 13 sections, or
areas for review. For each of the first
eight areas of review, the document asks the employee to rate himself in that
area by marking a box next to "Must Improve," "Meets
Requirements," and/or "Exceeds Requirements." Under these boxes, the form provides space
for the employee to provide written comments to explain his or her
self-evaluation. Under the employee's
comments for each section, the supervisor is asked to rate the employee on the
same scale, and to provide comments explaining the rating given. The final five sections ─
"Strengths," "Weaknesses," "Challenges to overcome
(how can I do a better job and provide more value)," "Goals for next
period," and "Overall Comments," ─ do not ask for a
rating, but, rather, simply provide space for written comments by both the
employee and the supervisor.

Sandell's
written evaluation for 2004 indicated that Sandell was meeting or exceeding
requirements in all of the areas in which he was reviewed, with the exception
of one area entitled "Results."
In that area, Listug noted "Must Improve." However, in his comments under this section,
Listug indicated that he felt he "[had] to say" that because sales
had declined that year, for the first time in 20 years. Listug also took some of the blame for the
poor sales by noting that Sandell had come into a sales department that was
"in some turmoil" after the departure of the previous vice-president
of sales. Lustig indicated in his
comments that Sandell had already introduced helpful new approaches for the
sales department.

Sandell's
2005 review indicated that Sandell was meeting requirements across the board,
and that he was exceeding requirements in some areas. However, in the written comments associated
with some of the areas of review, Listug indicated some subjective
concerns. For example, Listug said that
while he agreed with Sandell's self-evaluation regarding his
"Attitude," Listug "sure would like to see more enthusiasm from
Robert." Listug added, "He
frequently seems bored, or he at least comes across that way. It would be nice if Robert were more outgoing
and friendly."

In 2006,
Listug rated Sandell's performance as meeting requirements in three areas. In three other areas, Listug rated Sandell's
performance as needing improvement. For
the final two areas of review, Listug marked both the "Must Improve"
and "Meets Requirements" boxes.
Listug also gave Sandell both positive and negative reviews on other
subjective criteria. For example, under
the area entitled "Teamwork," Listug states, "Robert has a
stable good attitude. He usually has
good constructive feedback or input.
He's easy to work with, and doesn't politic. In this sense, he's earned the trust of
others. However, he does not provide
enough leadership or drive to have the level of respect he should for the
position he has."

Under the
portion of the review sheet where Listug was to identify Sandell's
"Weaknesses," Listug wrote, "Robert does not have the drive that
this position requires. . . .
Maybe he's never had to actually lead sales in other companies he's worked
for, or inspire people to perform at a higher level, or put the fear of God in
them if they don't. But he does not put
anywhere near the amount of passion, life, energy or drive into leading
sales." Under "Goals for next
period," Listug indicated that he wanted Sandell to "[l]ead and
manage [his] staff with [his] emotion and personality, and with inspiration and
life." Below that, however, in the
"Overall Comments" section, Listug wrote, "Robert's a good man,
and he's contributed positively to the company.
He's provided stability to the sales area that was lacking. The sales staff like interacting with him,
and respect his opinion and his experience.
He's generally on top of what is happening in sales."

Sandell
turned 60 years old in October 2007. A
few days later, on October 31, 2007,
Taylor-Listug terminated Sandell's employment.
Listug made the decision to fire Sandell. According to Listug, his "primary
frustration with Sandell was his lack of leadership in providing direction to
the sales team and in producing satisfactory sales results."

B. Procedural background

Sandell
filed a complaint against Taylor-Listug on May 29, 2008. In
his complaint, Sandell alleged two causes of action under the Fair Employment
and Housing Act (FEHA; Gov. Code, § 12900 et seq.) -- disability
discrimination and age discrimination.

On February 20, 2009, Taylor-Listug
filed a motion for summary judgment. After full briefing on the motion, on May 7, 2009, the trial court issued a
tentative ruling granting Taylor-Listug's motion in full. The court held a hearing on May 8, and after
hearing oral argument on the motion, adopted its tentative order as the final
order of the court.

The court
entered judgment in favor of Taylor-Listug on May 20, 2009.
Counsel for Taylor-Listug filed a notice of entry of judgment on May
29. Sandell filed a timely notice of
appeal on July 9, 2009.

III.

DISCUSSION

A. Legal standards

1. >Standards applicable to discrimination
claims

"Because
of the similarity between state and federal employment discrimination laws, California
courts look to pertinent federal precedent when applying our own
statutes." (Guz v. Bechtel National, Inc. (2000) 24 Cal.4th 317, 354 ( >Guz).)
California has adopted the
three-stage burden-shifting test for discrimination claims set forth in >McDonnell Douglas Corp. v. Green (1973)
411 U.S.
792. (Guz, supra, 24 Cal.4th at
pp. 354-356.) "This so-called >McDonnell Douglas test reflects the
principle that direct evidence of intentional discrimination is rare, and that
such claims must usually be proved circumstantially. Thus, by successive steps of increasingly
narrow focus, the test allows discrimination to be inferred from facts that
create a reasonable likelihood of bias and are not satisfactorily
explained." (Guz, supra, 24 Cal.4th at
p. 354; see also Mixon v. Fair
Employment & Housing Com. (1987) 192 Cal.App.3d 1306, 1317 ["In
most cases, the complainant will be unable to produce direct evidence of the
employer's intent. Consequently certain
rules regarding the allocation of burdens and order of presentation of proof
have developed in order to achieve a fair determination of 'the elusive factual
question of intentional discrimination.'
[Citation.]"].)

"At
trial, the McDonnell Douglas test
places on the plaintiff the initial burden to establish a prima facie case of
discrimination. This step is designed to
eliminate at the outset the most patently meritless claims, as where the
plaintiff is not a member of the protected class or was clearly unqualified, or
where the job he sought was withdrawn and never filled. [Citations.]" (Guz,
supra, 24 Cal.4th at
pp. 354-355.)

"If,
at trial, the plaintiff establishes a prima facie case, a presumption of
discrimination arises.
[Citations.]" ( >Guz, supra,
24 Cal.4th at p. 355.)
"Accordingly, at this trial stage, the burden shifts to the
employer to rebut the presumption by producing admissible evidence, sufficient
to 'raise[] a genuine issue of fact" and to "justify a judgment for
the [employer],' that its action was taken for a legitimate, nondiscriminatory
reason. [Citations.]" (Id.
at pp. 355-356.)

"If
the employer sustains this burden, the presumption of discrimination
disappears. [Citations.] The plaintiff must then have the opportunity
to attack the employer's proffered reasons as pretexts for discrimination, or
to offer any other evidence of discriminatory motive. [Citations.]
In an appropriate case, evidence of dishonest reasons, considered
together with the elements of the prima facie case, may permit a finding of
prohibited bias. [Citations.]" (Guz,
supra, 24 Cal.4th at p. 356.)

2. >Summary judgment standards

"Summary
judgment is granted when a moving party establishes the right to the entry of
judgment as a matter of law. [Citation.]
On appeal, the reviewing court makes '"an independent assessment of
the correctness of the trial court's ruling, applying the same legal standard
as the trial court in determining whether there are any genuine issues of
material fact or whether the moving party is entitled to judgment as a matter
of law. [Citations.]"'
[Citations.]" ( >Hesperia Citizens for Responsible
Development v. City of Hesperia (2007) 151 Cal.App.4th 653, 658.)

In
independently examining the record on appeal "to determine whether triable
issues of material fact exist," we "'consider[] all the evidence set
forth in the moving and opposition papers except that to which objections were
made and sustained.' [Citations.]" (Ambriz
v. Kelegian (2007) 146 Cal.App.4th 1519, 1530.) Further, "'we must view the evidence in
a light favorable to plaintiff as the losing party [citation], liberally
construing [the plaintiff's] evidentiary submission while strictly scrutinizing
the defendants' own showing, and resolving any evidentiary doubts or
ambiguities in plaintiff's favor.' [Citation.]" (Ibid.)


"'In the summary judgment context
, . . . the evidence must be incapable of supporting a
judgment for the losing party in order to validate the summary judgment.'"
(Faust v. California Portland Cement Co.
(2007) 150 Cal.App.4th 864, 877 (Faust).) "'Thus even though it may appear that a
trial court took a "reasonable" view of the evidence, a summary
judgment cannot properly be affirmed unless a contrary view would be
unreasonable as a matter of law in the circumstances presented.' [Citation.]" (Ibid.)

3. >Summary judgment in the context of a
discrimination claim

"'[W]e must keep in mind that the >McDonnell Douglas test was originally
developed for use at trial [citation], not in summary judgment
proceedings. "In such pretrial
[motion] proceedings, the trial court will be called upon to decide if the
plaintiff has met his or her burden of establishing a prima facie case of
unlawful discrimination. If the employer
presents admissible evidence either that one or more of plaintiff's
prima facie elements is lacking, or that the adverse employment action was
based on legitimate, nondiscriminatory factors, the employer will be entitled to
summary judgment unless the plaintiff
produces admissible evidence which raises a triable issue of fact material to
the defendant's showing. In short,
by applying McDonnell Douglas's
shifting burdens of production in the context of a motion for summary judgment,
'the judge [will] determine whether the litigants have created an issue of fact
to be decided by the jury.'" . . . Thus,
"'[a]lthough the burden of proof in a [discrimination] action claiming an unjustifiable
[termination] ultimately rests with the plaintiff . . . ,
in the case of a motion for summary judgment or summary issue adjudication, >the burden rests with the moving party >to negate the plaintiff's right to prevail
on a particular issue. . . .
In other words, the burden is reversed in the case of a summary issue
adjudication or summary judgment motion. . . .'"' [Citation.]" (Arteaga
v. Brink's, Inc. (2008) 163 Cal.App.4th 327, 343-344, second italics
added.)



"'Whether
judgment as a matter of law is appropriate in any particular case will depend
on a number of factors. These include
the strength of the plaintiff's prima facie case, the probative value of
the proof that the employer's explanation is false, and any other evidence that
supports the employer's case . . . .' [Citation.]" (Guz,
supra, 24 Cal.4th at p. 362.)

B. The
trial court erred in summarily adjudicating Sandell's disability

> discrimination
claim



The trial
court concluded that Sandell failed to present a prima facie case of disability
discrimination. The court further
concluded that even if Sandell had sufficiently made out a prima facie case of
discrimination, Taylor-Listug had produced evidence demonstrating that it
terminated Sandell's employment for a legitimate business reason, and that
Sandell failed to present evidence in response showing that the reason that
Taylor-Listug offered for his termination was a pretext for
discrimination. We conclude that in
ruling on Taylor-Listug's summary judgment motion, the trial court failed to
view the evidence in the light most favorable to Sandell and misapplied the
law, causing it to reach the erroneous conclusion that summary adjudication of
this claim was appropriate.^[3]

1. >Legal standards for a FEHA disability
discrimination claim

FEHA
prohibits employment discrimination based on a physical disability. (Gov. Code, § 12940,
subd. (a).) The Legislature has
made it clear that FEHA's statutory provisions are to be interpreted broadly. "The law of this state contains broad
definitions of physical disability, mental disability, and medical
condition. It is the intent of the
Legislature that the definitions of physical disability and mental disability
be construed so that applicants and employees are protected from discrimination
due to an actual or perceived physical or mental impairment that is disabling,
potentially disabling, or perceived as disabling or potentially
disabling." (Gov. Code,
§ 12926.1, subd. (b); see also Gov. Code, § 12993, subd. (a)
["The provisions of [FEHA] shall be construed liberally for the accomplishment
of [its] purposes . . . ."].)

In the
context of disability discrimination, the plaintiff initially has the burden to
establish a prima facie case of discrimination.
The plaintiff can meet this burden by presenting evidence that
demonstrates, even circumstantially or by inference, that he or she (1)
suffered from a disability, or was regarded as suffering from a disability; (2)
could perform the essential duties of the job with or without reasonable
accommodations, and (3) was subjected to an adverse employment action
because of the disability or perceived disability. (Jensen
v. Wells Fargo Bank (2000) 85 Cal.App.4th 245, 254.) To establish a prima facie case, a plaintiff
must show "'"'actions taken by the employer from which one can infer,
if such actions remain unexplained, that it is more likely than not that such
actions were "based on a [prohibited] discriminatory
criterion . . . ."'"' [Citation.]" (Reid
v. Google (2010) 50 Cal.4th 512, 520, fn. 2 (Reid).) The prima facie
burden is light; the evidence necessary to sustain the burden is minimal. (Heard
v. Lockheed Missiles & Space Co. (1996) 44 Cal.App.4th 1735, 1751 ( >Heard).)
As noted above, while the elements of a plaintiff's prima facie case can
vary considerably, generally an employee need only offer sufficient
circumstantial evidence to give rise to a reasonable inference of discrimination.
(Hersant v. Calif. Dept. of Social
Services (1997) 57 Cal.App.4th 997, 1002 (Hersant) [explaining nature of prima facie case in context of age
discrimination].)

2. >Sandell presented a prima facie case of
disability discrimination^[4]

>

a. Sandell
presented evidence that he is "disabled"

> under
FEHA



Under FEHA,
a person is "physically disabled" when he or she has a physiological
condition that "limits a major
life activity." (Govt. Code,
§ 12926, subd. (k)(1)(B), italics added.)^[5] "[A] qualifying disease or condition
'limits a major life activity if it makes the achievement' of the activity
'difficult.' [Citation.]" (Colmenares
v. Braemar Country Club, Inc. (2003) 29 Cal.4th 1019, 1027, fn. omitted ( >Colmenares).) "'Limits' shall be determined without
regard to mitigating measures such as medications, assistive devices,
prosthetics, or reasonable accommodations, unless the mitigating measure itself
limits a major life activity."
(Gov. Code, § 12926, subd. (k)(1)(B)(i).)

It is clear
that walking is a major life activity under FEHA. (Cal. Code Regs., tit. 2, § 7293.6,
subd. (e)(1)(A)(2)(a) ["'Major Life Activities' are functions such as
caring for one's self, performing manual tasks, walking, seeing, hearing, speaking, breathing, learning, and
working." (Italics added.)].) Sandell presented abundant evidence that his
ability to walk after his stroke was impaired, and that from the time of his stroke
to the time Taylor-Listug terminated his employment, he required a cane as an
assistive device. Sandell thus presented
sufficient evidence to demonstrate that he was limited in his ability to walk --
a major life activity -- and, therefore, that he suffered from a disability at
the time his employment was terminated.

Despite the
fact that it is undisputed that Sandell required a cane to walk, Taylor-Listug
nevertheless argues that Sandell failed to establish that he is disabled.^[6] We disagree.
At a minimum, evidence that an individual requires a cane in order to
walk is clearly sufficient to establish that a person is physically disabled
under California law.

Taylor-Listug
cites McDonald v. Coldwell Banker
(9th Cir. 2008) 543 F.3d 498, 505, fn. 6 (McDonald), in support of its position that "while Sandell's
condition may have affected his gait, he was not disabled." In dictum, the McDonald court stated:

"It should be noted that McDonald, who asserts
disability by virtue of her use of a walking cane, has not produced any
evidence of being disabled within the meaning of the Unruh Act, which requires
any 'physiological disease, disorder, condition, cosmetic disfigurement, or
anatomical loss that does both of the
following: (A) [a]ffects one or more of
the following body systems: neurological, immunological,
musculoskeletal, . . . and (B) [l]imits >a major life activity.' See Cal. Gov. Code § 12926
(k)(1)(A)-(B). . . . The
only evidence of disability presented by McDonald is that she uses a cane;
this, alone, does not establish that a 'major life activity' has been
limited. See 42 U.S.C. § 12102; see
also Albertson's, Inc. v. Kirkingburg,
527 U.S. 555, 564-66, 119 S. Ct. 2162, 144 L. Ed. 2d 518 (1999)
(holding that to be 'disabled' under the Americans with Disability Act ('ADA')
one must have 'limitations that are in fact substantial' and because every
determination of whether an individual is disabled is 'case-by-case,'
particularized evidence is needed)."
(McDonald, >supra, 543 F.3d at p. 505,
fn. 6.)



The >McDonald court did not, in our view,
properly interpret California law
on the subject of the meaning of "disability" under FEHA. Although the McDonald court believed that it was applying the provisions of FEHA
in rejecting a plaintiff's use of a cane as evidencing a disability, that court
incorrectly relied on federal legal
standards in reaching this conclusion.
As noted above, California
law and federal law differ with respect to the standard for establishing a
disability, in that federal law requires a showing of a "substantial
limitation," while FEHA requires only that the condition
"limits" a major life activity.
(Colmenares, supra, 29 Cal.4th
at pp. 1025-1027, 1030 ["[A] physical disability under the FEHA does >not require the federal test's >substantial limitation of a major life
activity. [Citation.]
. . . [T]he FEHA's test [is] 'limits,' not
substantial limits."].) We
therefore reject the McDonald court's
conclusion that evidence of the use of a cane by one asserting disability
discrimination is necessarily insufficient to demonstrate that he or she
suffers from a "disability" under California
law. One could reasonably infer from
evidence that a person uses a cane to walk that he needs the cane to walk, and is therefore limited with respect to a
major life activity, as defined under FEHA.

In addition
to evidence concerning Sandell's need to use a cane, Sandell also presented
evidence that his speech was impaired as a result of his stroke. Speaking, like walking, is deemed to be a
major life activity under California
law. (Cal. Code Regs., tit. 2,
§ 7293.6, subd. (e)(1)(A)(2)(a).)
Taylor-Listug's only response to Sandell's evidence regarding his
impaired speech is its contention that "[e]ven though Sandell may have
spoken with a more deliberate pace, his condition did not limit his ability to
speak."^[7] However, the evidence is clearly sufficient
for a fact finder to conclude that Sandell's stroke caused him to have
difficulty speaking, and that he was thus limited in this major life activity,
as well.







To be continue as part II……







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^[1] We
base our factual background primarily on the facts that the parties set forth
in their separate statements of facts filed in the trial court, and the
evidence cited therein. (See Coburn v.
Sievert (2005) 133 Cal.App.4th 1483, 1489.)