Starbucks Corporation v. Superior Court (Lords) (Labor and Employment)

Fourth District, Division Three

Cite as 2008 SOS 6624

Filed December 10, 2008

Job Applicants’ Discrimination Class Suit Found Inapplicable

Eric Lords, Hon Yeung, and Donald Brown charged Starbucks Corporation under a Labor Code provision that prohibits prospective employers from inquiring about marijuana-related convictions that are more than two years old.

The three men applied for jobs at Starbucks and in the application, they were made to answer questions regarding convictions related to marijuana possession, which is an illegal act.

According to law, California employers are prohibited from asking job applicants about arrests not resulting in convictions. Section 432.8, which extended that prohibition to most marijuana-related convictions after two years, was enacted in the 1970s, along with legislation minimizing penalties for possessing small amounts of the drug.

An applicant who is subjected to an inquiry in violation of the section is entitled to actual damages or $200, whichever is greater, and the plaintiffs sought the minimum recovery on behalf of each member of the class.

Because of this, the three applicants filed a discrimination class action suit.

However, Starbucks noted that the standard application form completed by the plaintiffs included a disclaimer section, immediately following the portion of the form by which the applicant authorizes the company to investigate his or her background.

The disclaimer section, in addition to advising all U.S. applicants that their employment is terminable at will, and all Maryland and Massachusetts applicants that they cannot be forced to take a lie detector test, informs those seeking to work in California that:

“Applicant may omit any convictions for the possession of marijuana (except for convictions for the possessions of marijuana on school grounds or possession of concentrated cannabis) that are more than two (2) years old, and any information concerning a referral to, and participation in, any pretrial or post trial diversion program.”

Following discovery, Starbucks moved for summary judgment, with the following important notes:

• that none of the three plaintiffs had ever been convicted of a marijuana-related offense

• that Lords had truthfully stated as such on the application form, while the other plaintiffs had refused to answer the question

• that none of the plaintiffs claimed that the company’s decision not to hire him was related to the use or non-use of marijuana or to his answer or non-answer to the question

The company also argued that the disclaimer precluded liability.

The plaintiffs responded with the following arguments:

• that the disclaimer was “buried within a block of type,” did not specifically refer to the convictions question in a different section of the application

• it was placed at the end of the document, so that applicants would likely have already answered the question before seeing it and would not want to go back and erase or cross out an answer.

The Orange Superior Court certified a class made up of all California applicants who were asked the convictions question since June 23, 2004, saying “the mere offering of the application containing the impermissible question” violated the statute and subjected the company to the minimum liability to each class member.

The judge also denied summary judgment on the ground that “triable issues” existed regarding whether the location of the disclaimer and “the eight-point font size in which it was printed” were adequate to remind each applicant that they did not have to answer the question.

Starbucks petitioned for writ of mandate on the ground that it lacked an adequate remedy in the trial court because “the huge potential judgment might force it to settle”. The Court of Appeal agreed to hear the merits and granted a stay.

The Fourth District Court of Appeal therefore junked the $26-million class action by applicants for Starbucks Corporation jobs who claimed the company illegally asked them about prior convictions related to marijuana possession.

The panel granted a writ of mandate directing that summary judgment be entered in favor of the company. The court held that the three men who filed the suit should not be allowed to represent a class of more than 130,000 applicants because their own claims were invalid.