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MEL CRAIG THOMPSON on behalf of himself all other persons similarly situated and the general public Plaintiffs
vs.
BORG-WARNER PROTECTIVE SERVICES CORPORATION d/b/a BURNS INTERNATIONAL SECURITY SERVICES and DOES I through XX inclusive Defendants.
 
Case:
No. C-94-4015 MHP
 
Location:
UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF CALIFORNIA
 
Date:
March 13, 1995 Decided
 
Attorneys:
For MEL CRAIG THOMPSON Plaintiff: Linda Q. Foy Howard Rice Nemerovski Canady Falk & Rabin San Francisco CA. Brad Seligman Albany CA.
For BORG-WARNER PROTECTIVE SERVICES CORPORATION dba Burns International Security Services Inc. defendant: John F. Meyers Seyfarth Shaw Fairweather & Geraldson San Francisco CA.
 
Court:
MARILYN HALL PATEL United States District Court
 
Author:
The Hon. Justice Marilyn Hall Patel
 

Plaintiff Mel Craig Thompson ("Thompson") brought this class action against Defendant Borg-Warner Protective Services Corporation doing business as Burns International Security Services ("Burns") alleging violations of the Americans with Disabilities Act ("ADA") California Fair Employment and Housing Act ("FEHA") California Labor Code and Business and Professions Code and seeking damages and injunctive relief. This action was removed to this court based on diversity jurisdiction. 28 U.S.C. SEC. 1332.

Burns now moves for summary judgment *fn1 alleging that Thompson has waived any rights to bring an action against Burns. Thompson counter-moves for partial summary judgment seeking a determination that the waiver forms signed by Thompson do not bar his claims.

Having considered the parties' arguments and submissions and for the reasons set forth below Court enters the following memorandum and order.

FACTUAL BACKGROUND *fn2

The facts before Court are undisputed. Thompson applied for a security job with Burns in August 1993. As a requirement of being considered for employment Thompson signed a "General Waiver" which provided inter alia:

In contemplation thereof I release the Company the Company's client(s) and their . . . agents and employees the NRC and all persons whomsoever from any claims or actions I may have against them individually or collectively arising directly or indirectly from any examination test investigation or furnishing and disclosing of said information. I acknowledge and agree to hold the Company its Clients . . . agents and their successors and assigns harmless from any injury or damage of whatsoever nature arising from or caused by my submission to such testing or such investigations including but not limited to the negligent administration of such tests or such investigations.

Also as a requirement of being considered for employment Thompson completed and signed a job application which contained a "Pre-employment Agreement" that provided in part:

I understand that as a condition of my employment I may be required to complete satisfactorily a physical examination including testing for drug and/or alcohol psychological testing and credit check. I release the Company from any claim arising out of such tests and waive all rights to damages of any form I may suffer from submitting to such tests. I also understand that as a condition of my employment I must sign and abide by the Company's General Waiver . . . .

As part of the application process Thompson was required to complete a document known as the P.A.S.S. III(R) D.A.T.A. Survey ("Survey"). Thompson asserts that Burns refused to hire him because of his political views concerning corporations workers' rights and drug and alcohol laws which were allegedly revealed by the Survey.

LEGAL STANDARD

Under Federal Rule of Civil Procedure 56 summary judgment shall be granted "against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case and on which that party will bear the burden of proof at trial . . . since a complete failure of proof concerning an essential element of the nonmoving party's case necessarily renders all other facts immaterial." Celotex Corp. v. Catrett 477 U.S. 317 322-23 91 L. Ed. 2d 265 106 S. Ct.2548 (1986). See also T.W. Elec. Serv. v. Pacific Elec. Contractors Ass'n 809 F.2d 626 630 (9th Cir.1987) (the nonmoving party may not rely on the pleadings but must present significant probative evidence supporting the claim).

Court's function however is not to make credibility determinations Anderson v. Liberty Lobby Inc. 477 U.S. 242 249 91 L. Ed. 2d 202 106 S. Ct.2505 (1986) and the inferences to be drawn from the facts must be viewed in a light most favorable to the party opposing the motion. T.W. Elec. Serv. 809 F.2d at 631.

DISCUSSION

Burns contends that by signing the two waivers Thompson has waived his right to bring any action against Burns arising out of the employment application process. Thompson argues that the waivers violate public policy and therefore to the extent they bar his claims should be declared invalid as matter of law under California Civil Code SEC.(s) 1668 and 3513.*fn3

In Tunkl v. Regents of University of California 60 Cal. 2d 92 32 Cal. Rptr.33 383 P.2d 441 (1963) the California Supreme Court set forth factors to be considered in determining whether a contractual waiver violates section 1668. Tunkl explained that exculpatory clauses may only stand if they do not involve the public interest. Tunkl 60 Cal. 2d at 96. A transaction involves the public interest where the party seeking exculpation uses superior bargaining power to confront the public with an adhesion contract leaving the public subject to the risks of carelessness.*fn4 Id. at 101. Tunkl clarified that "no public policy opposes private voluntary transactions in which one party for a consideration agrees to shoulder a risk which the law would otherwise have placed upon the other party." Id.

Burns insists that the waivers as private voluntary transactions are precisely the type of contract Tunkl held to be outside the scope of section 1668. In support of this conclusion Burns cites cases ruling on invasion of privacy claims arising from drug testing. See Hill v. National Collegiate Athletic Association 7 Cal. 4th 1 865 P.2d 633 (1994); Wilkinson v. Times Mirror Corp. 215 Cal. App. 3d 1034 264 Cal. Rptr.194 (1989). Wilkinson held that an employer could condition consideration for employment on the limited invasion of privacy caused by drug testing. Wilkinson 215 Cal. App. 3d at 1049. Hill held that the plaintiff was barred from proceeding with an invasion of privacy claim where the plaintiff consented to the action allegedly constituting the invasion. Hill 7 Cal. 4th at 40-43.

These cases do not convince Court that the Burns waivers are valid under California law. Conditioning consideration for employment on submission to a drug test and waiving a right to a privacy claim are very different from conditioning employment consideration on a waiver of all possible claims arising out of the application process. Hill did not hold that the plaintiff was barred from bringing any suit related to the administration of the drug test and Wilkinson did not hold that employment consideration could be conditioned on such a waiver -- which comparably is what Burns asks this court to do. In the case at bar Burns confronted Thompson with a "take it or leave it" waiver agreement purporting to immunize the employer from any and all liability; these facts place the Burns waiver squarely within the Tunkl description of a waiver that violates section 1668.*fn5

Moreover Baker Pacific Corp. v. Suttles 220 Cal. App. 3d 1148 269 Cal. Rptr.709 (1990) held that a pre-employment agreement that applicants were required to sign in exchange for employment consideration violated section 1668. In Baker Pacific the pre-employment agreement attempted to require applicants to waive any claims against the employer or its agents "for from and against any and all liability whatsoever" and to "relinquish any and all claims of every nature." Id. at 1151. Court rejected defendant's argument that the waiver should be read in a manner consistent with section 1668. "There can be no doubt that this release includes a release . . . as proscribed in Civil Code section 1668." Id. at 1153.

The present case is quite similar to Baker Pacific. In exchange for employment consideration Thompson was required to sign waivers which purport to release Burns from all claims and to hold Burns harmless for any action related to the application process. On their face the waivers clearly attempt to relieve Burns of liability for fraud willful injury and violations of law.*fn6

Burns argues that if Thompson did not like the conditions in the waivers then he should have refused to sign them and initiated legal action challenging the requirement -- as did the plaintiffs in Baker Pacific. Burns asserts that Thompson already having been considered for employment should not now be allowed to breach the signed waivers. However Thompson's signature cannot validate an unlawful agreement. An exculpatory clause involving the public interest as outlined in Tunkl does not become a private voluntary agreement when signed. If employers were permitted to contractually circumvent section 1668 the purpose of the legislation would be defeated entirely.

An employment applicant compelled by economic necessity has relatively little if any bargaining power when compared to employers. The applicant has little choice but to sign a waiver presented as a requirement for consideration for employment. The court agrees with Baker Pacific: "This 'pistol to the head' approach to an employment relationship where hiring is conditioned on acceptance of statutorily proscribed terms is not acceptable to us." Id. at 1155.

CONCLUSION

Accordingly Court finds that the Pre-employment Agreement and General Waiver violate section 1668 and are invalid as a matter of law to the extent they bar Thompson's claims alleging violations of the ADA FEHA California Labor Code and Business and Professions Code.*fn7

For the foregoing reasons Burns's motion for summary judgment is DENIED and Thompson's counter-motion for partial summary judgment is GRANTED.

IT IS SO ORDERED.

MARILYN HALL PATEL

United States District Court

 
Notes:

*fn1 Burns characterized the motion as a motion to dismiss for a failure to state a claim under Federal Rule of Civil Procedure 12(b)(6). However the issue of waiver was not addressed in Thompson's complaint and therefore Court will construe the motion as a motion for summary judgment.

*fn2 The facts in this background section have been taken directly from the Joint Statement of Facts Not in Dispute.

*fn3 California Civil Code SEC. 1668 provides: "All contracts which have for their object directly or indirectly to exempt anyone for responsibility for his own fraud or willful injury to the person or property of another or violation of law whether willful or negligent are against the policy of the law."

California Civil Code SEC. 3513 provides: "Anyone may waive the advantage of law intended solely for his benefit. But a law established for a public reason cannot be contravened by a private agreement."

*fn4 Tunkl explained that the types of transactions which involve the public interest include those where "the party invoking exculpation possesses a decisive advantage of bargaining strength against any member of the public who seeks his services " and in "exercising a superior bargaining power the party confronts the public with a standardized adhesion contract of exculpation and makes no provision whereby a purchaser may . . . obtain protection against negligence. Finally as a result of the transaction the person or property of the purchaser is placed under the control of the seller subject to the risk of carelessness by the seller or his agents." Tunkl 60 Cal. 2d at 100-01.

*fn5 This conclusion does not invalidate all agreements containing releases of statutory discrimination claims as Burns contends. See Baker Pacific Corp. v. Suttles 220 Cal. App. 3d 1148 1157 269 Cal. Rptr.709 (1990) (discussion of agreements for the settlement of claims arising from a past event).

*fn6 Burns attempts to distinguish the waivers from Baker Pacific claiming they are limited and specific because they only apply to tests and investigations related to the application process. This is analogous to saying that the waiver in Baker Pacific is limited and specific because it only applies to claims related to asbestos exposure. To that Court responded "It is hard to imagine a clearer or broader release." Baker Pacific 220 Cal. App. 3d at 1153.

*fn7 Since Court finds that the waivers violate section 1668 there is no need to reach the remaining two issues: whether the waivers violate section 3513 and whether Thompson knowingly and intentionally waived his rights.