FEHA Legal Update: Eleven Recent California Court of Appeal Decisions

California’s Fair Employment and Housing Act continues to generate published and newly reported Court of Appeal decisions with practical consequences for employees, employers, and Civil Rights Department (CRD) investigations. This legal update summarizes eleven recently reported FEHA and related employment opinions: Civil Rights Department v. Space Exploration Technologies Corp. (filed Aug. 11, 2026; certified for partial publication Sept. 9, 2026), Glick v. City of Los Angeles (July 30, 2026), Morales v. Superior Court (Aug. 3, 2026), Smith v. Burbank Unified School District (Oct. 7, 2026), Cruz v. City of Hermosa Beach (Oct. 15, 2026), Doe v. Wells Fargo Bank, N.A. (Oct. 5, 2026), McInerney v. Regents of University of California (Sept. 18, 2026), Villasenor v. Schneiter (Oct. 26, 2026), San Diego-Tomas v. Aspire Bakeries, LLC (Oct. 2, 2026), Chaudhry v. State of California (Sept. 28, 2026), and Chin v. DoorDash, Inc. (Oct. 5, 2026).

Updated October 8, 2026 to add Smith v. Burbank Unified School District, October 20, 2026 to add Cruz v. City of Hermosa Beach, October 21, 2026 to add Doe v. Wells Fargo Bank and McInerney v. Regents of University of California, October 27, 2026 to add Villasenor v. Schneiter, October 29, 2026 to add San Diego-Tomas v. Aspire Bakeries, and November 12, 2026 to add Chaudhry v. State of California and Chin v. DoorDash.

Together, the cases address how far FEHA investigations may reach across state lines, how trial courts may (and may not) cut jury awards for discrimination and retaliation, when a narrow employment arbitration clause leaves FEHA and related claims in court, whether unpaid leave can be a reasonable accommodation of an employee’s religious beliefs, whether a police officer fired under a vaccine mandate is entitled to a POBRA administrative appeal, when an employer is strictly liable for harassment by a supervisor, how much protection California’s Fair Chance Act gives job applicants with conviction records, whether a FEHA plaintiff can more easily hold a company’s owner personally liable for the judgment, what a winning employer must do before it can make a losing employee pay its costs, whether a supervisor can be personally sued for whistleblower retaliation, and when an employee gives up the federal right to take a sexual harassment case out of arbitration.

1. CRD v. SpaceX: Out-of-state work does not automatically stop a FEHA investigation

In Civil Rights Department v. Space Exploration Technologies Corp., No. B346853 (Cal. Ct. App., 2d Dist., Div. 3, filed Aug. 11, 2026) 2026 WL 2654677, the Second District affirmed a Los Angeles Superior Court order compelling SpaceX to comply with a CRD investigatory subpoena.

What happened

A former SpaceX employee filed a CRD complaint alleging sex/gender pay and promotion discrimination and retaliation for helping draft and circulate an open letter criticizing the company and its CEO. SpaceX listed a California address on the complaint. The employee had been hired to work in Redmond, Washington. SpaceX objected that CRD lacked power to investigate because FEHA does not apply outside California. CRD first focused discovery on where the alleged conduct occurred, then petitioned the superior court to compel production on the retaliation claim and on remaining jurisdictional facts for the discrimination claims. The trial court granted the petition. SpaceX appealed.

What the Court of Appeal held

The court affirmed. SpaceX did not carry its burden to show that enforcing the subpoena was unconstitutional, barred by the presumption against extraterritorial legislation, or beyond CRD’s FEHA jurisdiction. Key points:

• Constitutional challenges were forfeited. SpaceX’s opening brief offered only a cursory mix of Commerce Clause, due process, full-faith-and-credit, and supremacy arguments, without explaining how an investigatory subpoena to a company with a significant California presence violated any of them. A Fourth Amendment “fishing expedition” argument raised for the first time in the reply brief was also forfeited.
• Extraterritoriality is not a categorical bar. Following Ward v. United Airlines, Inc. (2020) 9 Cal.5th 732, the court treated the question as which California connections trigger the relevant FEHA provisions—not whether any out-of-state effect automatically defeats the statute. Investigatory authority and substantive liability raise separate analyses; fewer connections may suffice to let CRD investigate than to impose liability.
• No blanket “employee must work in California” rule for FEHA. SpaceX argued that FEHA never reaches workers who live and work outside California, relying on wage-and-hour cases such as Tidewater, Sullivan, Ward, and Oman. The court rejected that categorical rule. Those decisions did not involve FEHA, and the Supreme Court has emphasized that each statute must be construed on its own terms.
• The complaint did not prove the claims were purely Washington events. SpaceX overstated the territorial facts. The administrative complaint did not allege that every adverse action occurred exclusively in Washington. CRD pointed to California connections alleged in related litigation, including California-based managers, pay statements issued from California, and California new-hire paperwork. Campbell v. Arco Marine, Inc. (1996) 42 Cal.App.4th 1850 was distinguishable because the California connections there were settled and insufficient; here, those facts were still being investigated.

The opinion was later certified for partial publication (no change in the judgment) on September 9, 2026.

Why it matters

Employers with California headquarters, California managers, or California payroll cannot assume that a worker’s out-of-state residence and duty station ends a CRD investigation at the threshold. CRD may use subpoenas to determine whether alleged discrimination or retaliation has a substantial connection to California. Employees who report to California leadership or receive California-sourced pay may have a path to FEHA process even if they physically work elsewhere. The decision does not hold that FEHA always applies to out-of-state workers; it holds that SpaceX failed to show CRD lacked investigatory jurisdiction on this record.

2. Glick v. City of Los Angeles: No artificial cap on “garden-variety” FEHA emotional-distress awards

In Glick v. City of Los Angeles (2026) 122 Cal.App.5th 151, the Second District (Division 2) reversed a remittitur that had slashed a FEHA gender-discrimination and retaliation verdict against the City of Los Angeles, and it reinstated the jury’s judgment.

What happened

Two male LAPD officers, Stephen Glick and Alfred Garcia, alleged they were treated more harshly than their female partners after an arrestee claimed unknown officers had defaced him in a holding cell. Internal Affairs seized the male officers’ phones, lockers, and vehicles, benched them from the field while their female partners stayed on patrol, and the chief of police later sought termination-level discipline that was ultimately reduced. A union representative who complained about the disparity was told, in substance, that this was “something guys would do, not females.”

A jury found gender discrimination and retaliation. It awarded Glick about $8.62 million (including $8 million in noneconomic damages and $621,358 in future economic damages) and Garcia $4.5 million in noneconomic damages. The officers had stipulated they were not claiming emotional distress beyond the usual distress associated with the claimed injuries and would not present expert psychiatric testimony. The trial court conditionally granted a new trial unless Glick accepted $250,000 and Garcia accepted $125,000, characterizing the proof as “garden-variety” distress and wiping out Glick’s economic award as speculative.

What the Court of Appeal held

• The officers’ own testimony about stress, family strain, career harm, alcohol relapse, and loss of trust in the department was enough to support the noneconomic awards. Expert testimony is not required for emotional distress within jurors’ common experience.
• The trial court abused its discretion by treating “garden-variety” distress as subject to an unofficial ceiling in the low five- or six-figure range. There is no fixed legal maximum for noneconomic damages, and the awards were not so large as to show passion or prejudice as a matter of law.
• Zeroing Glick’s future economic damages was also an abuse of discretion. The jury heard admissible testimony from Glick that the City’s conduct would cause him to retire earlier than planned, plus expert testimony quantifying that loss at $621,358. The City had even disavowed a challenge to the economic award in its new-trial motion.

The new-trial order was reversed and the original judgment reinstated and affirmed.

Why it matters

Public and private employers defending FEHA verdicts cannot count on a trial judge to recut a large noneconomic award merely because the plaintiff did not call a psychiatrist or labeled the distress “usual.” Plaintiff-side, a stipulation under Code of Civil Procedure section 2032.320 does not automatically confine a jury to a token number. The decision also underscores that an employee’s own testimony about shortened career plans, if credited, can support future economic damages.

3. Morales v. Superior Court: Narrow arbitration language does not cover FEHA, CFRA, or Tameny claims

Morales v. Superior Court of San Diego County (2026) 122 Cal.App.5th 239 is now in the official reports. We previously analyzed the writ decision in detail in Morales v. Superior Court: Narrow Arbitration Clauses and FEHA Claims.

In short, Silvia Morales sued San Diego Gas & Electric after a 2024 termination, alleging FEHA disability claims, CFRA retaliation, and a Tameny public-policy claim. The Fourth District (Division 1) held that the later, integrated invention/confidentiality agreement—not the earlier offer letter—controlled, and that a clause covering disputes “regarding any aspect of this Agreement” or alleged violations of the Agreement did not reach statutory and public-policy claims that exist independent of the contract. The court directed the superior court to deny the motion to compel arbitration.

For employees and employers still using older offer letters and invention agreements, wording limited to disputes about the agreement is not a broad employment-arbitration clause.

4. Smith v. Burbank Unified School District: Unpaid leave was a reasonable religious accommodation for an unvaccinated teacher

In Smith v. Burbank Unified School District, No. B347288 (Cal. Ct. App., 2d Dist., Div. 8, filed Oct. 7, 2026) --- Cal.Rptr.3d ---- [2026 WL 3015264], the Second District (Division 8) affirmed summary judgment for a school district that placed a teacher with a religious exemption from its COVID-19 vaccine mandate on unpaid leave rather than letting him teach in person with masking and testing.

What happened

Douglas Smith, a devout Christian, taught high school chemistry and physical science for the District for roughly three decades with positive evaluations. In September 2021, as full-time in-person classes resumed during a COVID-19 surge, the District’s Board required all staff to be fully vaccinated or obtain an authorized exemption and barred unvaccinated employees from campus after October 25, 2021. About 100 employees requested exemptions on religious, medical, or other grounds, and the District granted every request, including Smith’s.

The District then treated all exempted employees the same way regardless of the basis for the exemption. Five employees in isolated office jobs—none of them teachers—were allowed to keep working with twice-weekly testing, plastic barriers, masks, and distancing. For everyone else with frequent in-person contact, including every teacher, the District concluded that unpaid leave was the only accommodation that would not impose an undue burden. Smith asked to keep teaching with masking and weekly PCR testing instead. The District denied his appeal and rejected his internal discrimination complaint.

Smith exhausted his paid leave in March 2022, went on unpaid leave, and had to pay his own benefit premiums (about $951 per month) to keep coverage. In January 2023 he took a teaching job at a school without a vaccine mandate. When the District later lifted its mandate and invited unvaccinated employees back, Smith resigned. He sued under FEHA for religious discrimination, failure to prevent discrimination, and retaliation. The trial court granted summary judgment for the District.

What the Court of Appeal held

The parties agreed Smith made a prima facie case of religious discrimination. The only question under Government Code section 12940, subdivision (l)(1), was whether the District explored available accommodations and could not accommodate Smith’s beliefs without undue hardship. The court affirmed:

• Involuntary unpaid leave is not categorically unreasonable. Smith relied on the last sentence of FEHA’s religious-accommodation regulation (Cal. Code Regs., tit. 2, § 11062, subd. (a)), which says that, unless the employee requests it, an accommodation is not reasonable if it requires segregating the employee from customers or the general public. The court rejected that literal reading on this record. Unpaid leave eliminated the conflict between Smith’s religious practice and the vaccination requirement, and Smith kept the ability to return when the mandate ended. The court drew support from Ansonia Bd. of Educ. v. Philbrook (1986) 479 U.S. 60, which recognized that unpaid leave can be a reasonable religious accommodation.
• Undue hardship was established, and argument is not evidence. The District submitted evidence that full vaccination was the most effective way to protect students and staff, that partial reopening without a mandate had caused major operational disruption, and that accommodating unvaccinated teachers would create classroom-coverage and student-supervision problems. Smith did not controvert that evidence; his position that one more unvaccinated person on campus posed “no meaningful hardship” was, in the court’s words, “argument, not evidence.” Viewing the record in the nonmoving party’s favor does not require a court to disregard the moving party’s unrebutted evidence.
• Uniform treatment defeated the inference of discrimination. The District granted every exemption, gave every exempted teacher the same accommodation, and offered alternatives only to non-teachers without daily contact with others. With the discrimination claim gone, the derivative failure-to-prevent and retaliation claims failed as well.

Why it matters

As a published opinion, Smith gives employers defending pandemic-era vaccine-mandate cases citable California authority that unpaid leave can be a reasonable FEHA religious accommodation. But the holding is tied to its record. The court did not hold that unpaid leave is always a reasonable accommodation; it held that this District carried its burden with unrebutted evidence of hardship and applied one rule to every similarly situated employee. Employees challenging an accommodation decision need evidence—not just argument—that alternatives were feasible or that the employer applied its rules unevenly. Employers should document the interactive process, the specific hardships considered, and the consistency of their treatment across exemption types.

5. Cruz v. City of Hermosa Beach: No POBRA appeal for an officer terminated under an across-the-board vaccine requirement

In Cruz v. City of Hermosa Beach, No. B343086 (Cal. Ct. App., 2d Dist., Div. 5, filed Oct. 15, 2026, partially published) --- Cal.Rptr.3d ---- [2026 WL 3093028], the Second District (Division 5) affirmed summary judgment for a city that terminated a police officer who was denied a religious exemption from its COVID-19 vaccination requirement and did not get vaccinated. Only the opinion’s Public Safety Officers Procedural Bill of Rights Act (POBRA) discussion is published. Its rulings on the officer’s FEHA and Labor Code retaliation claims are unpublished and generally cannot be cited in California courts (Cal. Rules of Court, rule 8.1115).

What happened

In September 2021, the City of Hermosa Beach required all City employees to be vaccinated against COVID-19 by November 12, 2021 as a condition of employment, with religious and medical exemptions available through an interactive process. Jonathan Cruz, a Hermosa Beach police officer since 2009, requested a religious exemption and met with the City manager and human resources manager. In January 2022, the City denied the request, finding it was not based on a sincerely held religious belief and, alternatively, that accommodating him would be an undue hardship. Cruz did not provide proof of vaccination by the February 19, 2022 deadline.

On February 22, 2022, the City issued a non-disciplinary “Notice of Forfeiture of Employment,” placed Cruz on paid administrative leave, and offered him a pre-separation conference. A few days later, the City learned Cruz had filed an EEOC/DFEH complaint. After a conference attended by Cruz and his lawyer, the City terminated him on March 9, 2022. It later refused his request for a POBRA administrative appeal, reasoning that the separation was a non-disciplinary forfeiture for failing to meet a condition of employment. Cruz sued for POBRA violations, retaliation under Labor Code section 1102.5 and FEHA, declaratory relief, and mandamus.

What the Court of Appeal held

• Published: a uniform vaccination requirement is an employment qualification, not POBRA “punitive action.” POBRA (Gov. Code, § 3300 et seq.) gives officers the right to an administrative appeal from “punitive action,” which section 3303, subdivision (b) defines to include action that may lead to dismissal. Cruz argued that any termination is a per se dismissal under White v. County of Sacramento (1982) 31 Cal.3d 676. The court disagreed: White itself distinguished actions against an individual officer from situations like budget-driven mass layoffs, and POBRA’s history shows it protects officers under investigation or facing discipline. POBRA also does not regulate qualifications for employment (Burden v. Snowden (1992) 2 Cal.4th 556). Cruz was not fired for misconduct or poor performance; he was fired because he did not meet a minimum qualification imposed on every City employee. He had no right to a POBRA appeal.
• Unpublished: the retaliation claims failed on timing and causation. The City denied the exemption and started the separation before it learned of the EEOC/DFEH complaint, which established Labor Code section 1102.6’s “same-decision” defense by clear and convincing evidence. The FEHA retaliation claim, which targeted the denial of the administrative appeal, failed because refusing an appeal Cruz was not entitled to is not an adverse employment action. Costs on appeal were not awarded on the FEHA claim, because a prevailing FEHA defendant needs a finding that the claim was frivolous, unreasonable, or groundless (Gov. Code, § 12965, subd. (c)(6)).
• The religious-exemption denial itself was not decided. Cruz did not allege that the City acted unlawfully or with discriminatory motive in denying the exemption, and the court expressly declined to express an opinion on that question.

Why it matters

For peace officers, Cruz draws a line between discipline, which triggers POBRA’s procedural protections, and the failure to satisfy a qualification applied to the entire workforce, which does not. Earlier cases granting POBRA rights after terminations based on an individual officer’s fitness or conduct remain distinct. Read alongside Smith, the case also shows how claim selection shapes vaccine-mandate litigation: Cruz challenged the procedure and alleged retaliation, but never pleaded that the exemption denial was religious discrimination or a failure to accommodate—so the court never reached the question many employees most want answered. Employees should also note the timing problem: a discrimination complaint filed after the employer has already started the separation process will rarely support a retaliation claim on its own.

6. Doe v. Wells Fargo Bank: Strict liability applies only to harassment by the victim’s own supervisor

In Doe v. Wells Fargo Bank, N.A., No. B344642 (Cal. Ct. App., 2d Dist., Div. 4, filed Oct. 5, 2026) 123 Cal.App.5th 1033 [349 Cal.Rptr.3d 255], the Second District (Division 4) held that an employer is strictly liable under FEHA for sexual harassment by a supervisor only when the harasser is the plaintiff’s supervisor, acting in that capacity. A manager who supervises other employees but has no supervisory authority over the plaintiff is, as to her, a coworker—and the employer is liable only if it was negligent.

What happened

The plaintiff was a wealth advisor in Wells Fargo’s private bank. She accused Eric Pagel, a top-performing investment strategist and managing director who worked on many of her client teams, of harassing her and sexually assaulting her in her hotel room after a client dinner on a January 2020 business trip; she said she was too intoxicated to consent, while Pagel said the encounter was consensual. She mentioned harassing comments to a coworker about a month later, but that complaint was not escalated. In November 2020 she reported the alleged assault to Wells Fargo’s ethics hotline, her direct supervisor, and law enforcement. Wells Fargo put Pagel on paid leave, investigated for 10 months, found the harassment and assault allegations unsubstantiated, and issued Pagel a “final notice” for professionalism and conduct violations.

She sued for FEHA sexual harassment, failure to prevent harassment, and retaliation. She conceded Pagel was not her supervisor but argued Wells Fargo was strictly liable because Pagel supervised lower-level support staff. The trial court granted summary judgment, finding Pagel did not supervise her and that Wells Fargo took prompt and appropriate corrective action.

What the Court of Appeal held

• The harasser must be the plaintiff’s supervisor. Government Code section 12940, subdivision (j)(1) does not mention strict liability; courts infer it for harassment by a “supervisor,” a term section 12926, subdivision (t) defines by a person’s authority over other employees. Reading the statutes together and following State Dept. of Health Services v. Superior Court (2003) 31 Cal.4th 1026, the court held strict liability requires that the harasser be the plaintiff’s supervisor acting in the capacity of a supervisor when the harassment occurs. Someone who is not the victim’s supervisor cannot act in that capacity toward her.
• The rule avoids arbitrary results. Under the plaintiff’s reading, an employer would be strictly liable when a mid-level manager harasses her own boss, or when a shop foreman harasses an executive, but only negligently liable when two equal-rank coworkers harass each other—depending solely on whether the harasser happens to supervise someone else.
• Not limited to direct supervisors. The court stressed it was not holding that only a plaintiff’s direct or immediate supervisor counts. FEHA’s broad definition can make others the plaintiff’s supervisor too. But a person who supervises only other employees does not qualify.
• Older agency decisions and out-of-state law were not followed. The court declined to follow 1980s Fair Employment and Housing Commission decisions applying strict liability to all supervisors, which predated FEHA’s definition of “supervisor,” and disagreed with the Illinois Supreme Court’s contrary reading of Illinois law.
• Other theories were forfeited. The plaintiff did not argue the negligence standard on appeal, and she raised a ratification theory for the first time on appeal, so the court did not reach either one.

Why it matters

When the alleged harasser is a powerful colleague rather than the employee’s own supervisor, the case will usually turn on negligence: whether the employer knew or should have known of the harassment and failed to take immediate and appropriate corrective action. Employees should report harassment through formal channels and document how the employer responds. Plaintiffs’ lawyers should also plead and argue every available theory—supervisor, agent, negligence, and failure to prevent—at summary judgment, because Doe lost the alternatives through forfeiture. The decision does not resolve whether the alleged assault occurred, and it assumes, without deciding, that Pagel supervised other employees.

7. McInerney v. Regents: The Fair Chance Act regulates the process, not the outcome

In McInerney v. Regents of University of California, No. B339467 (Cal. Ct. App., 2d Dist., Div. 2, filed Sept. 18, 2026) --- Cal.Rptr.3d ---- [2026 WL 3059160], the Second District (Division 2) affirmed a judgment for UCLA on a job applicant’s claims under California’s Fair Chance Act (Gov. Code, § 12952) and FEHA’s anti-retaliation provisions. It held that courts will not second-guess the result of an employer’s individualized assessment of a conviction record, and that an applicant denied the full five business days to respond must still prove the violation harmed him.

What happened

John McInerney, a UCLA student in his late 60s, received a conditional offer for a student-facing office assistant job at the Graduate Student Resource Center and began working provisionally while his background check was pending. When he was taken off the schedule until the check cleared, he sent angry e-mails accusing staff of firing him for no reason and calling human resources “assholes.” The check revealed four drug convictions from 2005 to 2007. On January 5, 2022, UCLA sent a pre-adverse action letter giving him five business days to submit evidence of rehabilitation or mitigation. Instead of submitting evidence, he sent more hostile e-mails comparing staff to “witch hunters” and the Inquisition. Two days later—before the five days ran—UCLA told him he was ineligible.

The trial court ruled that UCLA properly conducted its individualized assessment, except that it cut short the five-day response period, and summarily adjudicated the retaliation claims. A jury then found that his conviction history was not a substantial factor in the decision and that UCLA would have reached the same decision even if he had received the full five days and submitted rehabilitation evidence.

What the Court of Appeal held

• The e-mails were not protected activity. FEHA retaliation requires opposition to a practice the employee reasonably believes FEHA prohibits. The Fair Chance Act expressly allows post-offer background checks and permits employers to disqualify applicants based on conviction history if they follow its procedures, so objecting to reliance on a 14-year-old conviction was not opposition to an unlawful practice. Separately, relying on Title VII cases, the court held that unreasonably hostile, demeaning communications fall outside FEHA’s protection. Even if the e-mails had been protected, timing alone could not overcome UCLA’s well-supported, legitimate reasons: the lack of any substantive response and his unprofessional conduct.
• No second-guessing the individualized assessment. The statute requires an employer to assess whether a conviction has a “direct and adverse relationship” with the job’s duties, considering the offense, the time elapsed, and the nature of the job. But the employer need not put that assessment in writing or explain its decision. The court held a court or jury may review whether the employer followed the required process, not whether it reached the right conclusion. It contrasted New York and Minnesota statutes that expressly bar disqualification absent a direct relationship. A regulatory presumption against relying on convictions seven or more years old applied only to adverse-impact challenges to bright-line policies, not to this individual claim.
• A shortened response period requires proof of harm. UCLA violated the five-business-day requirement, but the Fair Chance Act provides no statutory or nominal damages. As with other statutory torts, the applicant had to prove the violation caused him harm, and the jury found it did not.

Why it matters

For applicants with conviction records, the pre-adverse action notice is the critical opportunity: submit evidence of rehabilitation, mitigation, or errors in the report, and keep communications professional, because hostile messages can become an independent and lawful reason to deny the job. For employers, the case confirms that the Fair Chance Act is enforced through its procedures—conditional offer first, an individualized assessment, written notice, at least five business days to respond, and consideration of the response. Cutting the response period short is still a violation, even if a plaintiff must prove it changed the outcome to recover damages.

8. Villasenor v. Schneiter: FEHA does not change the presumption of corporate separateness

In Villasenor v. Schneiter, No. B337209 (Cal. Ct. App., 2d Dist., Div. 1, filed Oct. 26, 2026) --- Cal.Rptr.3d ---- [2026 WL 3205537], the Second District (Division 1) held that FEHA does not alter the common-law presumption that a corporation exists separately from its owner. A FEHA plaintiff who wins against a corporate employer and then tries to collect from the owner as the corporation’s alter ego bears the burden of overcoming that presumption, just like any other plaintiff. The court said no appellate decision had previously addressed the question.

What happened

Ana Villasenor worked as a restaurant hostess for SR Long Beach FD, Inc. and its parent, SR Restaurant Holdings Group, Inc., from December 2015 to April 2016. She alleged that her supervisor sexually harassed her and retaliated against her for rejecting his advances, leading to her constructive discharge. (She dismissed her claims against the supervisor after he obtained a bankruptcy discharge.) Kurt Schneiter owned the restaurant companies through his single-member LLC, and she sued him as their alter ego.

The trial was bifurcated. A jury found both companies liable for sexual harassment and other FEHA violations and awarded $345,061.17 in compensatory damages and $100,000 in punitive damages. The court later awarded $949,672.50 in attorney fees and $103,241.65 in costs against the companies. In a separate bench trial on alter ego liability, the court applied the presumption of corporate separateness and found she failed to prove either a unity of interest and ownership or that treating the companies as separate would be inequitable. It found that Schneiter had “availed himself appropriately of the protections of the Corporations Code” and was not persuaded that her judgment would go unpaid; Schneiter had estimated the companies held about $720,000 in liquid assets.

What the Court of Appeal held

• Only a pure question of law was raised. Villasenor did not challenge the sufficiency of the evidence. She argued instead that the trial court should not have applied the presumption at all, and that FEHA creates a contrary presumption favoring alter ego liability. She had not made that argument in the trial court, but the court reached it because it was purely legal.
• The strong presumption against displacing the common law controls. Alter ego liability is a common-law doctrine, and a statute abrogates the common law only if its language or evident purpose clearly shows that intent (McMillin Albany LLC v. Superior Court (2018) 4 Cal.5th 241). FEHA says nothing about alter ego liability or the enforcement of judgments.
• FEHA’s purpose and liberal-construction clause are not enough. Government Code section 12920’s goal of “effective remedies” and section 12993’s liberal-construction directive do not clearly signal an intent to change the presumption. The presumption is compatible with effective remedies: a plaintiff who collects from the corporate employer never needs the owner, and one who cannot collect may still reach the owner by rebutting the presumption.
• FEHA’s one-way fee rule does not carry over. Villasenor relied on the cases applying the asymmetrical Christiansburg standard to fees and costs (Williams v. Chino Valley Independent Fire Dist., Arave, and Pollock), along with Flannery v. Prentice and Ramirez v. Charter Communications. The court explained that those cases interpreted FEHA’s express fee provision, now Government Code section 12965, subdivision (c)(6), and did not consider alter ego liability. The policy behind the fee rule, avoiding the chilling effect of fee awards against losing plaintiffs, does not apply because the presumption matters only after a plaintiff wins.
• Judgment affirmed. The parties were ordered to bear their own costs on appeal.

Why it matters

A FEHA verdict against a small or thinly capitalized company is only as good as the company’s ability to pay. Villasenor confirms that employees get no special shortcut for reaching the owner’s personal assets: they must prove both a unity of interest (for example, commingled funds, undercapitalization, or disregard of corporate formalities) and an inequitable result if the corporate form is respected. Plaintiffs’ lawyers should identify every entity that functioned as the employer, develop alter ego evidence and asset information early in discovery, and raise every legal argument in the trial court. Individual harassers can be personally liable under FEHA, but that remedy may be lost if the harasser goes bankrupt, as happened here. For business owners, the decision shows that observing corporate formalities and keeping entities adequately capitalized continues to protect personal assets from employment judgments.

9. San Diego-Tomas v. Aspire Bakeries: No costs for a winning FEHA defendant without an express frivolousness finding

In San Diego-Tomas v. Aspire Bakeries, LLC, No. A175977 (Cal. Ct. App., 1st Dist., Div. 4, filed Oct. 2, 2026) --- Cal.Rptr.3d ---- [2026 WL 3181846], the First District (Division 4) reversed a $15,397.96 costs award to an employer that won summary judgment in a FEHA case. A prevailing FEHA defendant may recover costs only if the court finds the action was frivolous, unreasonable, or groundless (Gov. Code, § 12965, subd. (c)(6)). The court held, apparently for the first time in a published opinion, that the trial court must make that finding expressly for costs, as it already must for attorney fees.

What happened

Cecilia San Diego-Tomas sued her former employer, Aspire Bakeries, for FEHA discrimination and retaliation, wrongful discharge in violation of public policy, and breach of contract. The trial court granted Aspire summary judgment. The judgment said Aspire, “as the prevailing party,” could recover costs on filing a memorandum of costs. Aspire filed a $15,397.96 cost memorandum, San Diego-Tomas did not move to tax costs, and the court signed an amended judgment “confirm[ing]” the award. She appealed only the costs.

What the Court of Appeal held

• The ordinary cost-memorandum procedure does not apply. In most cases a prevailing party recovers costs as a matter of right (Code Civ. Proc., § 1032) by filing a cost memorandum, and the clerk enters the costs if no one moves to tax them. In FEHA cases, a winning defendant has no automatic right to costs. It must file a motion asking the court for a discretionary award, which requires a frivolousness finding (Pollock v. Tri-Modal Distribution Services, Inc. (2021) 11 Cal.5th 918; Neeble-Diamond v. Hotel California By the Sea, LLC (2024) 99 Cal.App.5th 551).
• No implied finding. Aspire argued that because the judge, not the clerk, entered the judgment awarding costs, the court had impliedly found the claims frivolous. The Court of Appeal disagreed. Extending Rosenman v. Christensen, Miller, Fink, Jacobs, Glaser, Weil & Shapiro (2001) 91 Cal.App.4th 859, which requires written findings before a FEHA defendant can recover attorney fees, the court held the same requirement applies to costs, because costs can also be substantial and chill employees from bringing civil rights claims. An award without written findings stands only if the record affirmatively shows the court applied the correct standard.
• The record showed the wrong standard. Neither Aspire’s summary judgment motion nor the order granting it mentioned costs or frivolousness. The judgment’s reference to Aspire’s status “as the prevailing party” suggested the court had used the general Code of Civil Procedure section 1032 standard instead.
• Remand, not outright reversal. San Diego-Tomas argued Aspire waived costs by not filing a proper motion within the 60-day deadline for fee motions. The court rejected Aspire’s argument that the appeal tolled that deadline, but because the judgment’s wording likely caused confusion, it remanded for the trial court to decide whether to extend the deadline for good cause under California Rules of Court, rule 3.1702(d), and if so, whether Aspire is entitled to costs and in what amount. The court left for remand how costs should be apportioned between the FEHA claims and the non-FEHA claims. San Diego-Tomas recovers her costs on appeal.

Why it matters

Employees who lose a FEHA case can still face a cost bill, but only through a noticed motion and an express finding that the case was frivolous, unreasonable, or groundless. A judgment that simply awards costs to the “prevailing party,” followed by a cost memorandum, is not enough, and an employee’s failure to move to tax costs does not cure the defect. Defense counsel should file a timely costs motion within the deadline for attorney fee motions and ask for specific findings. Plaintiffs’ counsel should still watch for and object to cost memoranda, especially when the complaint also includes non-FEHA claims, because the apportionment question remains open.

10. Chaudhry v. State of California: No individual supervisor liability under Labor Code section 1102.5

In Chaudhry v. State of California (2026) 123 Cal.App.5th 690 [349 Cal.Rptr.3d 78], No. A173501 (1st Dist., Div. 4, filed Sept. 28, 2026), the First District (Division 4) held, as a matter of first impression in California courts, that an employee cannot sue an individual manager or supervisor for whistleblower retaliation under Labor Code section 1102.5. The court also addressed the Government Claims Act deadline for state employees, the continuing violation doctrine, constructive discharge, and the administrative exhaustion requirement of the California Whistleblower Protection Act.

What happened

Farzana Chaudhry, a dental assistant at the California Medical Facility in Vacaville, had worked for the California Department of Corrections and Rehabilitation (CDCR) since 2007. She alleged that after she filed Cal/OSHA complaints about contaminated protective equipment and other safety problems from 2018 to 2020, CDCR retaliated with a baseless letter of instruction, a one-month unpaid suspension ending January 3, 2020, a counseling record, and other criticism. She presented a government claim in September 2020 and was fired that November. The State Personnel Board (SPB) overturned the firing, but when she returned in January 2022 her supervisor obstructed her work, and CDCR dismissed her again within weeks. CDCR withdrew that dismissal, and Chaudhry resigned on her first day back in August 2022. She sued the State, CDCR, and three supervisors under section 1102.5 and the Whistleblower Protection Act. Shortly before trial, the trial court granted judgment on the pleadings on every claim.

What the Court of Appeal held

• Supervisors are not personally liable under section 1102.5. The statute bars retaliation by “[a]n employer, or any person acting on behalf of the employer,” language added in 2013 to address threats to report workers to immigration authorities. Read with sections 1104, 1105, and 1102.6, which focus on the employer’s liability and give only the employer the same-decision defense, the court found the statute ambiguous. Following Jones v. Lodge at Torrey Pines Partnership (2008) 42 Cal.4th 1158, which held supervisors are not personally liable for FEHA retaliation, it concluded the Legislature did not intend individual liability. More than 30 federal district court decisions had reached the same result. The judgment for the three supervisors was affirmed.
• Minor discipline is not an adverse action. Two requests for a doctor’s note, one accusation of wearing a mask incorrectly, and a counseling record that was not alleged to have any consequences did not materially affect the terms of her employment.
• The continuing violation doctrine did not save the September 2020 claim. The alleged acts were spread over two years, with a gap of more than a year. Once Chaudhry served her unpaid suspension, the retaliation had become permanent, so her six-month window to present a government claim started running then, and the September 2020 claim was too late.
• The constructive discharge claim survives. Taken together, the first firing, the obstruction after reinstatement, the second dismissal, and its rescission could be intolerable enough to compel a reasonable employee to resign. A constructive discharge is the employer’s own act, so the August 2022 resignation fell within six months of her January 2023 government claim even though the conditions began earlier. The employer can still use the section 1102.6 defense. The section 1102.5 claim against the State and CDCR was reinstated.
• Whistleblower Protection Act claims require filing with the SPB first. Government Code section 8547.8, subdivision (c) makes a damages action unavailable until the employee has filed an SPB complaint and the SPB has issued, or failed to issue, findings. Chaudhry sued in April 2021 and only then filed with the SPB. Filing a placeholder lawsuit on the same facts and later amending to add the claim does not comply. The court suggested employees file the SPB complaint before or together with the government claim.
• The State can be a defendant. Following McLean v. State of California (2016) 1 Cal.5th 615, a state employee may be employed by both the State and her department.

Why it matters

Whistleblower plaintiffs should name the employer, not individual supervisors, on section 1102.5 claims. Some federal courts had declined to treat the joinder of supervisors as improper because no California court had decided the question, and this decision may change how those removal disputes come out. Public employees face strict, overlapping deadlines: generally six months to present a government claim for a section 1102.5 claim, and 12 months to file an SPB complaint before any Whistleblower Protection Act lawsuit. A suspension or other completed discipline can start the clock even if the retaliation continues. When retaliation drives an employee to quit, a constructive discharge can be a separate, timely adverse action.

11. Chin v. DoorDash: Employee waived the federal sexual harassment arbitration ban by holding back a known claim

In Chin v. DoorDash, Inc. (2026) 123 Cal.App.5th 1050 [349 Cal.Rptr.3d 242], No. B348844 (2d Dist., Div. 8, filed Oct. 5, 2026), a divided Second District (Division 8) held that an employee waived the protections of the federal Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021 (EFAA; 9 U.S.C. §§ 401–402). He strategically withheld a known sexual harassment claim while opposing arbitration and raised it only after the court had compelled arbitration.

What happened

Andrew Chin took nine weeks of parental bonding leave from DoorDash in early 2023 and was fired at the end of that year. In February 2024 he sued for CFRA violations, whistleblower retaliation, wrongful termination, and unfair competition, alleging that a superior repeatedly asked when he would take the rest of his leave. DoorDash moved to compel arbitration. Chin opposed only on the ground that no valid arbitration agreement existed. He later told the Court of Appeal he had left out a FEHA sexual harassment claim “[f]or strategic purposes.” At the hearing, after a tentative ruling against him, he said he might seek leave to add a harassment claim “to avoid arbitration under federal law,” but he never cited the EFAA. The court compelled arbitration. In December 2024 Chin added a FEHA sex-based harassment claim to his arbitration demand, alleging DoorDash discouraged men from taking parental leave. In April 2025 he filed a second lawsuit with the same claim. The trial court reluctantly invalidated the arbitration agreement under the EFAA as to both lawsuits and consolidated them.

What the Court of Appeal held

• EFAA rights can be waived. The EFAA makes a predispute arbitration agreement unenforceable only “at the election of” the person alleging sexual harassment. Following the Ninth Circuit’s recent decision in Ding v. Structure Therapeutics, Inc. (9th Cir. 2026) 187 F.4th 1231, the court held that ordinary waiver principles apply, and it assumed waiver must be proven by clear and convincing evidence.
• Grounds to avoid arbitration must be raised first. A party who knows of a basis for invalidating arbitration must raise it before the court compels arbitration. Chin’s original complaint already alleged the only specific harassing conduct, he did not dispute knowing about the EFAA, and he admitted holding back the claim for strategic reasons. That deliberate choice was a waiver as to his whole case, both the original claims and the later harassment claim.
• Distinguishing other cases. The plaintiff in Ding did not know of her harassment claim until arbitral discovery and invoked the EFAA as soon as she could. Quilala v. Securitas Security Services USA, Inc. (2025) 117 Cal.App.5th 75 found a valid election where the complaint already included a harassment claim, and it did not analyze waiver of a known right.
• Arbitration ordered. The court reversed the orders invalidating the agreement, denying arbitration, and consolidating the cases, and directed the trial court to compel arbitration. It did not decide whether Chin’s harassment claim was strong enough to trigger the EFAA.
• Dissent. Justice Wiley would have affirmed. In his view Chin’s goal was always to litigate in court, his delay was a blunder rather than an intentional relinquishment of a known right, and the better response would be to consider sanctioning counsel for the wasted fees.

Why it matters

Under the EFAA and Casey v. Superior Court (2025) 108 Cal.App.5th 575, a sexual harassment claim can keep an entire related case out of arbitration. Chin shows that the protection must be used promptly. Employees with facts supporting sexual harassment should plead the harassment claim in the original complaint and expressly invoke the EFAA when opposing a motion to compel arbitration. Holding it back to test other defenses first can forfeit the right to a court for every claim. Employers facing late-added harassment claims should look closely at what the employee knew and when.

Practical takeaways

• Multistate employers: A Washington (or other out-of-state) duty station is not, standing alone, a complete defense to a CRD subpoena. California headquarters, California decisionmakers, California pay, and California ratification remain fair game for investigation.
• CRD process: Fighting a subpoena on territorial grounds requires a developed showing that the alleged unlawful practices lack sufficient California connections—not a categorical assertion that FEHA never leaves the state line.
• FEHA damages: Large noneconomic verdicts can stand on lay testimony. Remittitur still exists, but courts may not invent a “garden-variety” dollar cap.
• Arbitration: Read the clause. Agreement-only language often leaves FEHA, CFRA, and wrongful-termination-in-violation-of-public-policy claims in court. See our full Morales discussion.
• Religious accommodation: Unpaid leave can satisfy FEHA when it eliminates the religious conflict, preserves the right to return, and the employer proves that alternatives such as masking and testing would impose an undue hardship. Plaintiffs must answer the employer’s hardship evidence with evidence of their own.
• Peace officers and POBRA: A termination for failing an across-the-board employment qualification, such as a vaccination requirement, is not POBRA “punitive action” and carries no POBRA administrative-appeal right. Officers challenging such a termination should evaluate FEHA discrimination and accommodation claims directly rather than relying on POBRA procedure.
• Harassment by non-supervisors: Strict FEHA liability applies only when the harasser is the plaintiff’s own supervisor acting as such. Otherwise the employer is liable only if it knew or should have known and failed to act, so a prompt complaint and a documented record of the employer’s response matter.
• Fair Chance Act: Employers must follow the statute’s steps, but courts will not reweigh an employer’s conclusion about a conviction’s relevance. Applicants should use the five-business-day window to submit rehabilitation and mitigation evidence.
• Collecting a FEHA judgment from an owner: FEHA does not loosen alter ego rules. A plaintiff must still overcome the presumption of corporate separateness, so build the alter ego and collectability record before trial.
• Defense costs in FEHA cases: A winning employer cannot recover costs through a routine cost memorandum. It needs a timely motion and an express finding that the case was frivolous, unreasonable, or groundless, for costs as well as attorney fees.
• Whistleblower claims: Section 1102.5 claims run against the employer, not individual supervisors. Public employees must meet both the Government Claims Act deadline and, for Whistleblower Protection Act claims, file with the State Personnel Board before suing.
• Sexual harassment and arbitration: Plead a known sexual harassment claim and invoke the EFAA before the court rules on a motion to compel arbitration. Strategic delay can waive the right to keep the whole case in court.

If you are facing a CRD investigation, a FEHA lawsuit, a denied religious or other accommodation, a peace officer’s termination or POBRA appeal, a rescinded job offer after a background check, an effort to collect a FEHA judgment from a company’s owner, a cost bill after losing a FEHA case, whistleblower retaliation by a public employer, or an employer’s effort to force discrimination or retaliation claims into arbitration, the details of location, proof of harm, hardship evidence, and contract language matter. Contact Jonny Law to discuss your situation. This post is general information about recent California decisions and is not legal advice about any specific case.

Cases: Civil Rights Department v. Space Exploration Technologies Corp., No. B346853 (Cal. Ct. App., 2d Dist., Div. 3, filed Aug. 11, 2026, pub. order Sept. 9, 2026) 2026 WL 2654677; Glick v. City of Los Angeles (2026) 122 Cal.App.5th 151; Morales v. Superior Court (2026) 122 Cal.App.5th 239; Smith v. Burbank Unified School District, No. B347288 (Cal. Ct. App., 2d Dist., Div. 8, filed Oct. 7, 2026) --- Cal.Rptr.3d ---- [2026 WL 3015264]; Cruz v. City of Hermosa Beach, No. B343086 (Cal. Ct. App., 2d Dist., Div. 5, filed Oct. 15, 2026, partially published) --- Cal.Rptr.3d ---- [2026 WL 3093028]; Doe v. Wells Fargo Bank, N.A., No. B344642 (Cal. Ct. App., 2d Dist., Div. 4, filed Oct. 5, 2026) 123 Cal.App.5th 1033 [349 Cal.Rptr.3d 255]; McInerney v. Regents of University of California, No. B339467 (Cal. Ct. App., 2d Dist., Div. 2, filed Sept. 18, 2026) --- Cal.Rptr.3d ---- [2026 WL 3059160]; Villasenor v. Schneiter, No. B337209 (Cal. Ct. App., 2d Dist., Div. 1, filed Oct. 26, 2026) --- Cal.Rptr.3d ---- [2026 WL 3205537]; San Diego-Tomas v. Aspire Bakeries, LLC, No. A175977 (Cal. Ct. App., 1st Dist., Div. 4, filed Oct. 2, 2026) --- Cal.Rptr.3d ---- [2026 WL 3181846]; Chaudhry v. State of California (2026) 123 Cal.App.5th 690 [349 Cal.Rptr.3d 78], No. A173501 (1st Dist., Div. 4, filed Sept. 28, 2026); Chin v. DoorDash, Inc. (2026) 123 Cal.App.5th 1050 [349 Cal.Rptr.3d 242], No. B348844 (2d Dist., Div. 8, filed Oct. 5, 2026).