Kathleen Kapusta, J.D.
A registered medical marijuana cardholder who was terminated from his department store job after a positive drug test can take his breach of an implied contract and covenant of good faith and fair dealing claim to trial, a federal court in California ruled. A reasonable jury could conclude from the employer’s policies and the employee’s testimony that they agreed—subsequent to his acknowledgement of the at-will nature of his job—that he would not be discriminated against for his medicinal marijuana use. His defamation claim also survived summary judgment, but his FEHA disability discrimination claims all failed (Shepherd v. Kohl’s Department Stores, Inc.
, August 2, 2016, Drozd, D.).
Five years after he was hired as a material handler by Kohl’s, the at-will employee was diagnosed with acute and chronic anxiety and received a recommendation for medical marijuana, which he did not disclose to his employer. The following year, Kohl’s updated several policies to provide that employees in certain states, including California, who had valid medical marijuana recommendations, would not be discriminated against.
When the employee was subsequently injured while unloading cargo, he went to Kohl’s workers’ comp health care provider. He consented to a drug test and was fired after testing positive for trace amounts of marijuana metabolites. Although he told the corporate HR director that he was not under the influence at work and only used marijuana in connection with his anxiety diagnosis, she purportedly told him, "You should have chosen a different medication." He then sued, asserting numerous state-law claims against the retailer.
Failure to accommodate.
Before analyzing the employee’s FEHA claims, the court pointed out that in Ross v. RagingWire Technologies
, the California Supreme Court held that FEHA was not impacted by the Compassionate Use Act, which provides immunity against criminal prosecution under two state statutes but made no other changes in the legal status of marijuana. Noting that the RagingWire
court also stated that a "plaintiff cannot state a cause of action under the FEHA based on defendant’s refusal to accommodate his use of marijuana," the court here found that RagingWire
conclusively foreclosed the employee’s failure-to-accommodate claim.
While he argued that Kohl’s waived its right to rely on RagingWire
as a defense based on its revised policies, the court explained that it is not a violation of FEHA to terminate an employee based on his use of marijuana, regardless of why he uses it. In other word, said the court, "A defendant cannot waive into the ability to be sued for something that does not violate the law."
The court also found no authority suggesting a cognizable FEHA claim could be based simply on an employer’s failure to abide by policies not required by FEHA. Nor was it persuaded by the employee’s attempt to characterize his termination as a withdrawal of a pre-existing accommodation as Kohl’s did not know of the employee’s disability or his medical marijuana recommendation until after his positive drug test.
As to the employee’s claim that Kohl’s failed to engage in an interactive process, the court pointed out that it would be futile to compel a process seeking only a result Kohl’s could not be made to accept—that he be allowed to use medical marijuana or at least not be terminated because of his use. Further, said the court, there was simply no evidence that had the employee engaged in an interactive process, he would not have been terminated for testing positive for marijuana.
Granting summary judgment against his disability discrimination claim, the court again pointed out that there was no evidence the employee was terminated because of his anxiety rather than because of the manner in which he chose to treat it.
The employee fared no better on his invasion of privacy claim. Not only did the evidence establish that he was aware he could be drug tested long before he was injured, he was screened for drugs when he was hired and he signed several forms during his employment acknowledging that he could be subjected to drug tests. And while he argued that the change in Kohl’s policies rendered his consent form invalid, the court found that nothing in the changed policies indicated that employees would not be drug tested. Nor could he create a reasonable expectation of privacy out of a policy that generally permitted drug and alcohol testing.
Breach of implied contract.
The employee also argued that Kohl’s new policies became terms of his employment agreement and part of an implied contract that Kohl’s was bound not to breach. Here, the court found it undisputed that the employee was a medical marijuana cardholder, that he signed a statement acknowledging his at-will status when he was hired, and that several years later, Kohl’s amended several of its policies to include nondiscrimination provisions concerning the use of medicinal marijuana in certain states.
Further, the employee stated that he "understood the policies to very clearly say that as long as I used the [medical marijuana] at home and not close to a shift, I would be protected from getting fired even if I tested positive," which led him to abandon his efforts to look elsewhere for a job. Observing that the existence and content of employer agreements not to terminate based on certain assurances are particularly fact-driven, the court found a reasonable jury could conclude that the employee would not be discriminated against for his medicinal marijuana use, since he was a registered card holder. Thus, summary judgment was denied against this claim.
As to the employee’s defamation claim, the court noted that while his termination form stated he tested positive for controlled substances and violated three policies, including reporting to work in a condition unfit to perform his duties, the only evidence of his impairment was the positive test result. Noting evidence that marijuana metabolites may be detectable in a person’s urine for up to 30 days after use, though impairment would last only hours, together with the employee’s declaration stating he had a personal policy of not using the medicine within several days of working and that he had not used marijuana for several days prior to his injury, a reasonable jury could find he was not in an unfit condition and was not under the influence of drugs at work. Further, given the lack of evidence on his purported impairment, a jury could conclude that Kohl’s statements were made with a "reckless or wanton disregard for the truth.