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it offered other comedians. She further alleges that, after she objected to this
“discriminatory low-ball offer,” Netflix retaliated against her by refusing to
negotiate fair pay with her. (Complaint (“Compl.”), Dkt. No. 1-1 at ¶ 4). The
following facts are taken from the Complaint.

a. Netflix’s emergence as a dominating force in the stand-up comedy

industry

Netflix is a world-leading Internet-based entertainment services provider.

(Compl. ¶ 41). Netflix’s primary business is its subscription-based streaming
service, with more than 158 million paid subscribers in over 190 countries. (Id.).
The service offers its members online streaming of film and television programs,
including original content that Netflix produces in-house. (Id.). As part of its
original content creation, Netflix commissions comedians to produce and star in
standup comedy specials and has emerged “as a dominating force that is disrupting
the [standup comedy] industry.” (Id. ¶ 44).

b. Mo’Nique’s background as the “Queen of Comedy”

Mo’Nique is an Oscar-winning actress who has led a successful career as

both a stand-up comic and actress. (Id. ¶¶ 46–60). She has also won awards from
the Screen Actors Guild, Sundance Film Festival, BET, and NAACP, among many
others. (Id. ¶¶ 48–59).

c. Netflix’s allegedly discriminatory offer to Mo’Nique

In late 2017, after Netflix executives attended one of Mo’Nique’s live stand-
up shows, they began to recruit her for a Netflix original stand-up program. (Id. ¶¶
61–63). Following a series of conversations between Mo’Nique and her
representatives and Netflix’s representatives, on January 11, 2018, Netflix
extended an offer to Mo’Nique to produce and perform in a one-hour comedy
special, for which she would be paid $500,000. (Id. ¶ 64). Mo’Nique claims that
this pay proposal was discriminatory based on her race and gender, especially in
light of offers Netflix has made to other comedic talent, namely Jerry Seinfeld,
Eddie Murphy, Dave Chapelle, Chris Rock, Ellen DeGeneres, Jeff Dunham, Ricky
Gervais, and Amy Schumer (“Schumer”). (Id. ¶¶ 66–68).

After receiving her offer, Mo’Nique alleges that, both personally and
through her representatives, she objected to its terms, calling out Netflix for
discriminating against Black women. (Id. ¶¶ 69–70). Mo’Nique’s representatives

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initially wrote to Netflix’s executives, pleading that they reconsider the “racially
and gender biased offer” and questioning “what makes Mo’Nique, who has been
labeled a living legend based on her awards from around the world . . . worth
$12,500,000 less than Amy Schumer to [Netflix]?” (Id. ¶ 71). Netflix responded
that it took “very seriously” the concerns raised in the email, and agreed to set up a
call. (Id. ¶ 72).

On January 17, 2018, Mo’Nique’s representatives had a call with, among

others, Netflix’s Director of Original Stand-up Comedy Programming Robbie
Praw (“Praw”). (Id. ¶ 73). During this call, Mo’Nique’s representatives again asked
how Netflix had arrived at its pay valuation for Mo’Nique compared to others,
reiterating that she viewed her offer as discriminatory based on her race/color and
gender. (Id.). In explaining why the offer was so low in their view, Mo’Nique’s
representatives reviewed some of Mo’Nique’s body of work and her history of
success, to which Netflix responded that it does not look at “résumés” or “bodies
of work to arrive at pay offers, but rather uses an “assumptive approach.” (Id).

On the call, Praw allegedly justified paying Schumer (a White woman)

twenty-six times more than Mo’Nique on grounds that Schumer had sold out
Madison Square Garden and had a recent movie released. (Id). Mo’Nique’s
representatives replied that Netflix was citing Schumer’s “résumé” or “body of
work” to justify Schumer’s pay, but refused to look at Mo’Nique’s to make her a
fair pay offer. (Id.). Purportedly pressed repeatedly, Praw stated that based on its
“internal data” Netflix uses an “assumptive approach” or “anticipatory approach”
and “had a process” in determining compensation. (Id.). Based on this, Mo’Nique
maintains that Netflix “steadfastly refus[ed] to negotiate reasonable terms or
reconsider the lowball, discriminatory offer”, “refused to engage in any
negotiation”, and “presented its offer on ‘take it or leave it’ terms.” (Id. ¶¶ 73, 74).
She further alleges that, in other similar situations involving men and Caucasians,
Netflix has negotiated increased offers. (Id. ¶ 75). Around this time, Mo’Nique
spoke out publicly about her purportedly discriminatory offer and called for a
boycott of Netflix, claiming a discriminatory pay gap. (Id. ¶ 76).

Also around this time, as Plaintiff alleges, Netflix extended an offer for a
similar comedy special to Wanda Sykes (“Sykes”) (also a Black woman), who at
first publicly rejected Netflix’s offer as “low ball” and stated that she was
“offended” by it. (Id. ¶ 79). However, according to Plaintiff, after her call for a
boycott, Netflix subsequently “reconsidered and eventually offered Sykes a better
and more equitable deal.” (Id.). Mo’Nique alleges that Netflix has failed to do the

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same for her as retaliation for her public statements regarding Netflix’s alleged
“pay inequity practices.” (Id. ¶ 80).

Mo’Nique filed her Complaint in Los Angeles Superior Court on November

22, 2019. Netflix removed the action to this Court on December 10, 2019.
Mo’Nique asserts the following 10 claims: (1) Race Discrimination (Disparate
Treatment) in Violation of the Fair Employment and Housing Act (Cal. Gov. Code
§ 12940, et seq.) (“FEHA”); (2) Race Discrimination (Disparate Impact) in
Violation of the FEHA; (3) Sex/Gender Discrimination (Disparate Treatment) in
Violation of FEHA; (4) Sex/Gender Discrimination (Disparate Impact) in
Violation of FEHA; (5) Retaliation in Violation of FEHA; (6) Failure to Prevent
Discrimination and Retaliation in Violation of FEHA; (7) Discrimination Based on
Race/Ethnicity/Color/Ancestry (42 U.S.C. § 1981); (8) Retaliation (42 U.S.C. §
1981); (9) Discrimination in Violation of the Unruh Civil Rights Act (Cal. Civ.
Code § 51); and (10) Unfair Business Practices (Cal. Bus. & Prof. Code § 17200,
et seq.).

II. LEGAL STANDARD

a. Rule 12(b)(6) Motion to Dismiss

Federal Rule of Civil Procedure (“Rule”) 8 requires a plaintiff to present a

“short and plain statement of the claim showing that the pleader is entitled to
relief.” Fed. R. Civ. P. 8(a)(2). Under Rule 12(b)(6), a defendant may move to
dismiss a pleading for “failure to state a claim upon which relief can be granted.”
Fed. R. Civ. P. 12(b)(6).

To defeat a Rule 12(b)(6) motion to dismiss, the complaint must provide

enough factual detail to “give the defendant fair notice of what the . . . claim is and
the grounds upon which it rests.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555
(2007). The complaint must also be “plausible on its face,” that is, the “complaint
must contain sufficient factual matter, accepted as true, to ‘state a claim to relief
that is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting
Twombly, 550 U.S. at 570). A plaintiff’s “factual allegations must be enough to
raise a right to relief above the speculative level.” Twombly, 550 U.S. at 555. “The
plausibility standard is not akin to a ‘probability requirement,’ but it asks for more
than a sheer possibility that a defendant has acted unlawfully.” Id. Labels,
conclusions, and “a formulaic recitation of the elements of a cause of action will
not do.” Twombly, 550 U.S. at 555.

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A court may dismiss a complaint under Rule 12(b)(6) based on the lack of a
cognizable legal theory, or the absence of sufficient facts alleged under a
cognizable legal theory. Balistreri v. Pacifica Police Dep’t, 901 F.2d 696, 699 (9th
Cir. 1988). When ruling on a Rule 12(b)(6) motion, “a judge must accept as true all
of the factual allegations contained in the complaint.” Erickson v. Pardus, 551 U.S.
89, 94 (2007). The court must make all reasonable inferences in the plaintiff’s
favor. Nordstrom v. Ryan, 762 F.3d 903, 906 (9th Cir. 2014). But a court is “not
bound to accept as true a legal conclusion couched as a factual allegation.” Iqbal,
556 U.S. at 678 (internal quotation marks omitted).

b. Rule 12(f) Motion to Strike

Under Federal Rule of Civil Procedure (“Rule”) 12(f), the Court has
discretion to strike a pleading or portions thereof. Fed. Sav. and Loan v. Gemini
Mgmt., 921 F.2d 241, 243 (9th Cir. 1990); Cal. Dep’t of Toxic Substances Control
v. Alco Pac., Inc., 217 F. Supp. 2d 1028, 1033 (C.D. Cal. 2002) (“[W]hether to
grant a motion to strike lies within the sound discretion of the district court.”).

The purpose of a Rule 12(f) motion is “to avoid the expenditure of time and
money that must arise from litigating spurious issues by dispensing with those
issues prior to trial.’” Whittlestone, Inc. v. Handi-Craft Co., 618 F.3d 970, 973 (9th
Cir. 2010) (quoting Fantasy, Inc. v. Fogerty, 984 F.2d 1524, 1527 (9th Cir. 1993),
rev’d on other grounds, 510 U.S. 517 (1994)). Thus, a motion to strike may be
appropriate if it “will make trial less complicated or eliminate serious risks of
prejudice to the moving party, delay, or confusion of the issues.” Sliger v. Prospect
Mortg., LLC, 789 F. Supp. 2d 1212, 1216 (E.D. Cal. 2011). Motions to strike are
well-taken when they “have the effect of otherwise streamlining the ultimate
resolution of the action.” Gibson Brands Inc. v. Viacom Int’l Inc., No. 12-cv-
10870, 2016 WL 8931305, at *2 (C.D. Cal. Sept. 29, 2016) (internal quotations
omitted).

Rule 12(f) provides that a court “may strike from a pleading an insufficient
defense or any redundant, immaterial, impertinent, or scandalous matter.” Fed. R.
Civ. P. 12(f). “‘Immateriality’ and ‘impertinence’ under Rule 12(f) both speak to
the relevance of challenged allegations.” Gallegos v. Roman Catholic Archbishop
of San Francisco, Case No. 16-cv-01588-LB, 2016 WL 3162203, at *2 (N.D. Cal.
June 7, 2016). As relevant for the purposes of the instant Motion to Strike,

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• Immaterial matter “is that which has no essential or important

relationship to the claim for relief or the defenses being pleaded.”
Fantasy, Inc., 984 F.2d at 1527.

• Impertinent matter “consists of statements that do not pertain, and are

not necessary, to the issues in question.” Fantasy, Inc., 984 F.2d at
1527. “An ‘impertinent’ allegation is neither responsive nor relevant
to the issues involved in the action and which could not be put in issue
or given in evidence between the parties.” Wilkerson v. Butler, 229
F.R.D. 166, 170 (E.D. Cal. 2005) (citations omitted).

• Scandalous matter “refers to any allegation that unnecessarily reflects

on the moral character of an individual or states anything in repulsive
language that detracts from the dignity of the court” or to allegations
that “improperly cast a derogatory light on someone.” Gallegos, 2016
WL 3162203 at *2 (citations omitted).

“A court must deny the motion to strike if there is any doubt whether the
allegations in the pleadings might be relevant in the action.” Oracle Am., Inc. v.
Micron Tech., Inc., 817 F. Supp. 2d 1128, 1132 (N.D. Cal. 2011). Put differently,
“[m]atter will not be stricken from a pleading unless it is clear that it can have no
possible bearing upon the subject matter of the litigation[.]” Clark v. State Farm
Mut. Auto. Ins. Co., 231 F.R.D. 405, 406 (C.D. Cal. 2005) (alteration in original)
(quoting Alco Pac., Inc., 217 F. Supp. 2d at 1033).

However, “[a]s a rule, motions to strike are regarded with disfavor because
striking is such a drastic remedy; as a result, such motions are infrequently
granted.” Amini Innovations Corp. v. McFerran Home Furnishings, Inc., 301
F.R.D. 487, 489-90 (C.D. Cal. 2014) (citations omitted)); see also Sliger, 789 F.
Supp. 2d at 1216 (“Motions to strike are generally viewed with disfavor, and will
usually be denied unless the allegations in the pleading have no possible relation to
the controversy, and may cause prejudice to one of the parties.”). “[W]hen ruling
on a motion to strike,” the court accepts the challenged allegations as true and
“must liberally construe” those allegations “in the light most favorable” to the non-
moving pleader. Stearns v. Select Comfort Retail Corp., 763 F. Supp. 2d 1128,
1140 (N.D. Cal. 2010); see also RDF Media Ltd. v. Fox Broad. Co., 372 F. Supp.
2d 556, 561 (C.D. Cal. 2005). “[C]ourts often require a showing of prejudice by
the moving party before granting” a motion to strike. Alco Pac., Inc., 217 F. Supp.
2d at 1033 (internal quotation marks and citations omitted). Grounds for a motion

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to strike must be readily apparent from the face of the pleadings or from materials
that may be judicially noticed. Fantasy, Inc., 984 F.2d at 1528.

If matter is stricken, leave to amend should be freely given when doing so

would not cause prejudice to the opposing party. Vogel v. Huntington Oaks
Delaware Partners, LLC, 291 F.R.D. 438, 440 (C.D. Cal. 2013) (citing Wyshak v.
City Nat’l Bank, 607 F.2d 824, 826 (9th Cir.1979)).

III. DISCUSSION

a. Defendant’s Motion to Dismiss Retaliation-Based Claims:

Fifth Claim (Retaliation in Violation of FEHA); Part of the Sixth
Claim (Failure to Prevent Retaliation in Violation of FEHA) and
Eighth Claim (Retaliation in Violation of 42 U.S.C. § 1981)

Defendant moves to dismiss all of Plaintiff’s retaliation-based claims,

specifically her Fifth Claim alleging retaliation under FEHA, the portion of the
Sixth Claim alleging failure to prevent retaliation under FEHA,1 and the Eighth
Claim alleging retaliation under 42 U.S.C. section 1981.2 The Court begins its
analysis of Plaintiff’s retaliation-based claims with the legal standards governing
them.

i. General Legal Principles

(1) California Government Code § 12940(a), or FEHA

Plaintiff’s Fifth Claim and portion of the Sixth claim rest on Section
12940(a) of the California Government Code (or FEHA) which provides that “[i]t
is an unlawful employment practice,” except in situations not applicable here,
“[f]or an employer, because of the race, . . . color, . . . , or sex of any person, to
refuse to hire or employ the person . . . or to discriminate against the person in

1
Defendant only seeks dismissal of the portion of Plaintiff’s Sixth Claim to the
extent that it alleges that Defendant failed to prevent retaliation, not
discrimination.
2
Initially, Defendant moved to dismiss Plaintiff’s Ninth Claim alleging violation
of the Unruh Act, but now withdraws that motion based on Plaintiff’s
representation that she pled the Unruh Act claim in the alternative to her
employment claims. (MTD Reply at 5).

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compensation or in terms, conditions, or privileges of employment.” Cal. Gov’t

Code § 12940(a).
a. Retaliation under FEHA

California’s FEHA makes it unlawful for an employer to “discharge, expel,

or otherwise discriminate against any person because the person has opposed any
practices forbidden under this part or because the person has filed a complaint,
testified, or assisted in any proceeding under this part.” Cal. Gov’t Code §
12940(h). To assert a prima facie claim for retaliation under FEHA, Plaintiff must
plead that: (1) she engaged in “protected activity,” (2) the employer subjected her
to an “adverse employment action,” and (3) there is a “causal link” between the
protected activity and the employer’s action. See Yanowitz v. L’Oreal USA, Inc., 36
Cal.4th 1028, 1042 (2005); see also Doe v. Dep’t of Corr. & Rehab., 43
Cal.App.5th 721, 734 (2019); Brooks v. City of San Mateo, 229 F.3d 917, 928 (9th
Cir. 2000).

b. Failure to Prevent Retaliation under FEHA

Plaintiff’s Sixth Claim asserts that Defendant failed to prevent retaliation

under FEHA. California Government Code section 12940(k) makes it an unlawful
employment practice for an employer “to fail to take all reasonable steps necessary
to prevent discrimination and harassment from occurring.” Cal. Gov’t Code §
12940(k). California state courts have observed that this provision creates a
statutory tort action with the usual tort elements (duty of care to Plaintiff, breach of
duty, causation, and damages). See Ellis v. U.S. Sec. Assocs., 224 Cal.App.4th
1213, 1228 (2014); Veronese v. Lucasfilm Ltd., 212 Cal.App.4th 1, 28 (2012).
Federal courts have established elements for the claim: (1) that the plaintiff was
subjected to discrimination, harassment, or retaliation; (2) that the defendant failed
to take all reasonable steps to prevent discrimination, harassment, or retaliation;
and (3) that this failure caused the plaintiff to suffer injury, damage, loss, or harm.
See Aparicio v. Comcast, Inc., 274 F.Supp.3d 1014, 1030 (N.D. Cal. 2017); Pinder
v. Employment Dev. Dep’t, 227 F.Supp.3d 1123, 1141 (E.D. Cal. 2017).

Insofar as it is the first element recognized in the federal court decisions, and
that breach of duty and causation are required under the state court decisions, this
claim fails if the Court ultimately concludes that there was no actionable
workplace discrimination. See Trujillo v. N. Cty. Transit Dist., 63 Cal.App.4th 280,
288-89 (1998); Pinder, 227 F.Supp.3d at 1151. Further, to the extent that
Plaintiff’s Sixth claim arises from Defendant’s alleged failure to prevent
retaliation, that claim fails if Plaintiff cannot plead sufficient facts to show that she

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was subjected to retaliation in the first instance. Trujillo, 63 Cal.App.4th at 289

(holding that underlying “retaliation” is a prima facie element of a claim for
alleged failure to prevent that retaliation). Thus, as Plaintiff points out, Defendant’s
challenge to Plaintiff’s claim for failure to prevent retaliation is derivative of, and
dependent on, its attack on the FEHA, so the two challenges rise and fall together.
(MTD Opp’n at 10).

(2) Retaliation under 42 U.S.C. section 1981

Section 1981 encompasses employment-related retaliation claims.” CBOCS

West, Inc. v. Humphries, 553 U.S. 442, 452–57 (2008); Johnson v. Lucent Techs.,
Inc., 653 F.3d 1000, 1006 (9th Cir. 2011). 42 U.S.C. section 1981 (“Section 1981”)
states, in relevant part, that:

[a]ll persons within the jurisdiction of the United States shall have the
same right in every State and Territory to make and enforce contracts,
to sue . . . and to the full and equal benefit of all laws and proceedings
for the security of persons and property as is enjoyed by white citizens,
and shall be subject to like punishment, pains, [and] penalties . . . , and
to no other.

42 U.S.C. § 1981(a). The rights protected by Section 1981 “are protected against
impairment by nongovernmental discrimination and impairment under color of
State law.” Id. § 1981(c). Employment discrimination claims under Section 1981
are guided by the Title VII analysis which, like Plaintiff’s FEHA-based
discrimination claims, are governed by the burden-shifting framework set forth in
McDonnell Douglas Corp. v. Green, 411 U.S. 792, 802 (1973); see also Weil v.
Citizens Telecom Servs. Co., LLC, 922 F.3d 993, 1002 (9th Cir. 2019); Surrell v.
Cal. Water Serv. Co., 518 F.3d 1097, 1103 (9th Cir. 2008); Manatt v. Bank of Am.,
NA, 339 F.3d 792, 797 (9th Cir. 2003).

As with Plaintiff’s FEHA retaliation claim, her Eighth Claim for retaliation
under Section 1981 must allege facts that she engaged in an activity protected by
statute, and that she suffered an adverse employment action because she engaged
in that activity. See Brown v. Contra Costa County, No. C 12–1923 PJH, 2014 WL
1347680, at *6 (N.D. Cal. Apr. 3, 2014) (dismissing Section 1981 retaliation claim
because plaintiff alleged no facts showing that the alleged adverse action “was in
retaliation for [plaintiff’s] exercise of a contractual right protected under § 1981.”).
The analysis of retaliation claims under FEHA is the same as the analysis required

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for evaluation of her Section 1981 claims. See Sims v City & County of San
Francisco, 2015 WL 1351143, at *5 (N.D. Cal. Mar. 25, 2015).

ii. The Parties’ Arguments Regarding Plaintiff’s Retaliation

Claims3

Netflix argues that Mo’Nique’s retaliation claims fail as a matter of law

because (1) she alleges no conduct by Netflix constituting an “adverse employment
action” that occurred after she complained about her initial offer, and (2) she has
failed to allege any causal link between her protected activity and some “adverse
employment action.”4 The company asserts that Mo’Nique’s retaliation claims rest
on her argument that Netflix failed to reinitiate or continue negotiations with her
after she raised concerns about her allegedly “low-ball” offer. (MTD Reply at 1).
According to Netflix, its alleged failure to negotiate further does not constitute an
“adverse employment action” under the California Supreme Court’s decision in
Yanowitz, which requires such an adverse employment action to “materially affect
the terms, conditions, or privileges of employment[.]” Yanowitz. 36 Cal.4th at
1052. Netflix claims that no terms were materially affected here, because its
original $500,000 offer remained on the table, even after Mo’Nique engaged in
protected activity by complaining about that offer, speaking out publicly against it,
and calling for a Netflix boycott. (MTD Reply at 1). As such, Netflix claims that
“[t]he ball remained in [Mo’Nique’s] court to either accept the offer or make a
counteroffer,” and emphasizes that its “decision to stand behind its original offer
and not negotiate against itself” cannot be adverse action. (Id.). Netflix further
maintains that it had no “affirmative obligation to increase its offer” to Mo’Nique.
(MTD at 5).

Mo’Nique counters that she sets forth a viable theory of retaliation. She
argues that, after she objected to Netflix’s allegedly “low ball” offer to her and
spoke out against this offer, Netflix retaliated against her by “depart[ing] from its
regular practice and treat[ing] [her] worse than others” by denying her “continued

3
The Court notes that, for the purposes of this motion only, Defendant assumes
that Plaintiff was an employee or prospective employee entitled to FEHA’s
protections and that her act of publicly complaining about the offer and calling for
a boycott of Netflix are “protected activities.” (MTD at 4, n.3).
4
“By definition, ‘retaliation’ occurs only after the applicant has complained about
not getting the job or after she has begun to participate” in a protected activity.
Sada v. Robert F. Kennedy Med. Ctr., 56 Cal.App.4th 138, 161 (1997), as modified
on denial of reh’g (July 1, 1997) (emphasis added).

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negotiations or an increased offer[.]” (MTD Opp’n at 5). Specifically, Mo’Nique

asserts that her Complaint (see Compl. ¶¶ 71–75, 78–80) expressly alleges (1) that
she sought to re-open negotiations by pleading with Netflix to reconsider its initial
offer through email and a phone call, and (2) that Netflix steadfastly refused to do
so with her, even though the company had a practice of continuing negotiations in
other situations (involving non-Black women) where talent was dissatisfied with
the initial offer. (MTD Opp’n at 1, 9). Thus, Mo’Nique claims that, because she
challenged her offer through protected activity, Netflix retaliated by giving her “a
take-it-or-leave-it” offer that denied her the same practice or employment benefit
“of continued good-faith negotiation” that it often extends to those who do not
engage in legally protected activity like she did. (MTD Opp’n at 1).

iii. The Court’s Determination Regarding Plaintiff’s

Retaliation Claims

As a threshold matter, to plead a retaliation claim, Plaintiff must allege a

“causal link” between her protected activity and an adverse employment action.
Yanowitz, 36 Cal.4th at 1042 (FEHA retaliation); Brown, 2014 WL 1347680, at *6
(Section 1981 retaliation). Defendant argues that Plaintiff has failed to do so here,
and thus, her retaliation-based claims fail as a matter of law.

To constitute “an adverse employment action,” Defendant’s alleged “refusal

to fairly and equitably negotiate pay” must “materially affect the terms, conditions,
or privileges of employment[.]” Yanowitz. 36 Cal.4th at 1052. “Retaliation must
result in a substantial adverse change in the terms and conditions of the plaintiff’s
employment.” Akers v. County of San Diego, 95 Cal. App. 4th 1441, 1455 (2002)
(emphasis added).

Here, Plaintiff does not plausibly allege a claim of retaliation. In asserting

her Fifth and Eighth Claims for retaliation, Plaintiff alleges that after she engaged
in legally protected activity by “voic[ing] her complaints and objections” about her
allegedly discriminatory pay offer, Defendant subjected her to “adverse
employment actions . . . including the retaliatory refusal to fairly and equitably
negotiate her pay.” (¶¶ 136, 164). But the Court does not see how Defendant’s
purported failure to continue negotiations with Plaintiff affected any change to the
terms and conditions of her employment, let alone a substantial change. Plaintiff
alleges that Defendant gave her a $500,000 offer before she complained about that
offer being discriminatory and “low-ball.” (Compl. ¶ 64). And Plaintiff alleges
that, even after complaining, she continued to have that offer, purportedly left on
“take-it-or-leave-it” terms. (Compl. ¶ 75). Accordingly, Plaintiff alleges no change

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in, or affect to, the terms of her offer after her protected activity, and thus, no
adverse action. See Akers, 95 Cal.4th at 1455; Yanowitz, 36 Cal.4th at 1052.

Notably, in her Opposition, Plaintiff provides no authority or analysis

supporting her proposition that the “refusal to fairly and equitably negotiate pay”
constitutes an “adverse employment action” that materially affected the terms,
conditions, or privileges of her employment.5 She does not address Defendant’s
argument that her position before and after her protected activity was the same: an
open offer for $500,000. As such, Plaintiff has failed to plausibly allege a causal
connection between her speaking out and objecting to Defendant’s offer, on the
one hand, and an “adverse employment action,” or Defendant’s purported failure to
continue negotiations with her, on the other.

The Court notes that Plaintiff raises a novel theory here, namely that failure
to negotiate constitutes an “adverse employment action” for purposes of a
retaliation claim.6 At oral argument on February 28, 2020, Plaintiff conceded that
she did not adequately brief this issue, and asserted that she could allege additional
facts—including Defendant’s purported post-litigation public statement that “[its]
opening offer to Mo’Nique was fair”—to support her retaliation theory. Also at
oral argument, Plaintiff explained that the “adverse employment action” here was
Defendant’s failure to give equal consideration in her employment terms and
conditions, specifically her offered compensation, under California law. See Cal.
Code Regs. § 11021(a) (stating that “[i]t is unlawful for an employer . . . to . . . fail
to give equal consideration in making employment decisions . . . , adversely affect
working conditions or otherwise deny any employment benefit to an individual
because that individual has opposed practices prohibited by the Act[.]”). In light of
the arguments that Plaintiff raised orally before the Court, the Court allows
Plaintiff leave to amend her retaliation claims and to file a First Amended
Complaint adding facts in support thereof.

Ultimately, the Court finds that Plaintiff has failed to allege that any adverse
employment action occurred after she engaged in protected activity to make out a
retaliation claim under FEHA or Section 1981. Accordingly, Plaintiff’s Fifth and

5
Plaintiff merely cites to a footnote from Kotla v. Regents of University of
California, a wrongful termination case, for the proposition that “[e]vidence
showing . . . that . . . the employer significantly deviated from its ordinary
personnel procedures in the aggrieved employee’s case, might well be relevant to
support . . . an inference of retaliation.” 115 Cal.283, 294 fn. 6 (2004).
6
The Court has not located any case squarely addressing this issue.

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Eighth Claims are DISMISSED, but without prejudice, as the court finds that
amendment here may not be futile. Ketab Corp. v. Mesriani & Assocs., P.C., 734
F. App’x 401, 405 (9th Cir. 2018) (“[L]eave to amend is usually freely given
unless it is clear that the complaint could not be saved by amendment.”). Further,
the retaliation portion of Plaintiff’s Sixth Claim is also DISMISSED, again
without prejudice, as Plaintiff has failed to plead sufficient facts to show that there
was an act of retaliation in the first instance. Trujillo, 63 Cal. App. 4th at 289.

b. Defendant’s Motion to Strike

Defendant moves to strike paragraphs 1 and 13–18, 26–29, 30–33, 34–36,

and 37–40 on grounds that they are immaterial and impertinent to Plaintiff’s legal
claims. (MTS at 2). Defendant also moves to strike the aforementioned paragraphs,
26–29 and 30–33, on grounds that they are scandalous and prejudicial. (Id.).

Plaintiff claims that she makes these allegations regarding conduct at Netflix
involving individuals other than herself to support her core claim of discrimination.
Specifically, she pleads these allegations “to establish that the corporate culture
and or workplace atmosphere within Netflix has encouraged, tolerated and
condoned discriminatory treatment based on race and gender[.]” (MTS Opp’n at
5). As such, before turning to the specific paragraphs that Defendant seeks to
strike, the Court begins its analysis of the elements Plaintiff would have to prove
and the stages of the three-prong burden-shifting test she would have to pass under
McDonnell Douglas Corporation v. Green, 411 U.S. 792, 802 (1973) to prevail on
her discrimination claims.

i. The McDonnell Douglas Three-Prong Burden-Shifting Test

Regarding Plaintiff’s Race- and Sex-Based Discrimination
Claims

To prove a claim of race- or sex-based discrimination in violation of

California Government Code Section 12940(a) (or FEHA), Plaintiff must proceed
by way of the McDonnell Douglas three-step burden-shifting test. See Guz v.
Bechtel Nat’l Inc., 24 Cal.4th 317, 354 (2000); Harris v. City of Santa Monica, 56
Cal.4th 203, 214; Trop v. Sony Pictures Entm’t Inc., 129 Cal.App.4th 1133, 1144–
45 (2005); see also Zeinali v. Raytheon Co., 636 F.3d 544, 552 (9th Cir. 2011).
Under step one of this test, Plaintiff must establish a prima facie case of
discrimination. See, e.g., Alamillo v. BNSF Ry. Co., 869 F.3d 916, 920 (9th Cir.
2017).

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To establish this prima facie case, Plaintiff must offer proof that: (1) she
belongs to a class of protected individuals; (2) she was qualified for her position or
performed it satisfactorily; (3) she suffered an adverse employment action; and (4)
she was treated differently than a similarly situated employee who does not belong
to the same protected class or that other circumstances surrounding the adverse
employment action give rise to an inference of discrimination. See McDonnell
Douglas, 411 U.S. at 802; Guz, 24 Cal.4th at 355; Zeinali, 636 F.3d at 552. At the
first step of the McDonnell Douglas test, the burden on Plaintiff is slight. See Wills
v. Superior Court, 195 Cal.App.4th 143, 159 (2011) (“The burden in this [first]
stage is not onerous and the evidence necessary to satisfy it is minimal.”) (omitting
internal quotation marks); Arteaga v. Brink’s, Inc., 163 Cal.App.4th 327, 353
(2008) (describing plaintiff’s prima facie case burden under McDonnell Douglas as
“fairly minimal”). At this stage, Plaintiff may seek to introduce circumstantial
evidence of incidents at Netflix not involving her to support her in proving an
inference of discrimination at the fourth prong.

If Plaintiff succeeds in proving her prima facie case, a presumption arises

that her employer undertook the challenged employment action for a
discriminatory reason. See McDonnell Douglas, 411 U.S. at 802; Guz, 24 Cal.4th
at 355. Then, under step two of the McDonnell Douglas test, the burden shifts to
the defendant to articulate some legitimate, nondiscriminatory reason for the
adverse employment action. See Guz, 24 Cal.4th at 355–56; Zeinali, 636 F.3d at
552. Under step two, “a defendant meets its resulting burden of production by
‘introduc[ing] evidence, which, taken as true, would permit the conclusion that
there was a nondiscriminatory reason for the adverse action.’” Bodett v. CoxCom,
Inc., 366 F.3d 736, 742 (9th Cir. 2004) (quoting St. Mary’s Honor Ctr. v. Hicks,
509 U.S. 502, 509 (1993)).

If Defendants carry their burden at step two, the presumption of

discrimination disappears and swings back to Plaintiff for step three of the
McDonnell Douglas test. Under this third step, Plaintiff has an opportunity to
prove by a preponderance of the evidence that the legitimate reasons offered by
Defendants were not their true reasons, but merely a pretext for discrimination. See
Tex. Dep’t of Cmty. Affairs v. Burdine, 450 U.S. 248, 252-53 (1981); Rashdan v.
Geissberger, 764 F.3d 1179, 1182 (9th Cir. 2014) (Title VII case); Zeinali, 636
F.3d at 552. Again, here Plaintiff may seek to introduce circumstantial evidence of
incidents at Netflix not involving her to support her in proving pretext.

Overall, the “McDonnell Douglas test reflects the principle that direct
evidence of intentional discrimination is rare, and that such claims must usually be

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proved circumstantially.” Guz, 24 Cal.4th at 355. Absent direct evidence of

discrimination, as here, Plaintiff must put forth circumstantial “evidence
supporting a rational inference that intentional discrimination, on grounds
prohibited by the statute, was the true cause of the employer’s actions.” Id. at 361
(emphasis in original). In McDonnell Douglas, the Supreme Court stated that
evidence of the employer’s “general policy and practice with respect to minority
employment” may be relevant to prove pretext. McDonnell Douglas, 411 U.S. at
805–06.

ii. Defendant’s Motion to Strike Paragraphs 1 and 13–18, 26–

29, 30–33, 35–36, and 37–40

(1) The Court declines to strike paragraphs 1 and 13–18

alleging historical facts and statistics regarding the
Black women’s pay gap, finding no prejudice by their
inclusion in the Complaint.

Paragraphs 1 and 13–18 allege historical facts and statistics (largely from the
National Women’s Law Center) regarding the race- and gender-based pay gap
nationwide, focusing specifically on the pay disparity suffered by black women.
(See, e.g., Compl. ¶ 1 (“Black women earn only sixty-one cents ($.61) for every
one dollar ($1.00) that a white male earns.”); id. ¶ 13(“[B]ased on today’s wage
gap, a Black woman working a forty (40) year career stands to earn one million
dollars ($1,000,000.00) less than a White, non-Hispanic man.”)).

Defendant asserts that these allegations should be struck (1) because

“Plaintiff does not tie [them] to the negotiations at issue in her Complaint,” (MTS
at 6); (2) because they “have no specific relationship to Netflix whatsoever,” (MTS
Reply at 2); and (3) because they “impermissibly seek to hold Netflix liable for the
actions of others,” (MTS Reply at 13). Plaintiff counters that these historical
allegations “are not prejudicial but contextual.” (MTS Opp’n at 25). The Court
agrees that Defendant suffers no prejudice by these facts and statistics, which will
not extend the scope or costs of this suit, and further finds that they are not wholly
irrelevant to Plaintiff’s claims alleging pay discrimination because she is a Black
woman. Accordingly, finding some relevance, albeit general, and no prejudice to
Defendant by the inclusion of the allegations in paragraphs 1 and 13–18, the Court
declines to strike them.

//

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(2) The Court declines to strike paragraphs 26–29

alleging a 2017 incident regarding former Netflix
Chief Communications Officer who used a racial slur
in a meeting with about 60 members of Netflix’s
publicity staff (and was fired as a result), finding
these allegations relevant to Plaintiff’s claims.

Paragraphs 26–29 (“the Friedland Allegations”) allege a 2017 incident in

which Netflix’s then-Chief Communications Officer Jonathan Friedland
(“Friedland”) used the “n-word” at an internal meeting of approximately 60
members of Netflix’s publicity staff. (Compl. ¶¶ 27–28). Plaintiff alleges that
multiple offended employees lodged complaints about the incident, prompting
Friedland to apologize and meet with Netflix Founder and CEO Reed Hastings
(“CEO Hastings”). (Id. ¶ 27). Plaintiff further alleges that CEO Hastings later
terminated Friedland and acknowledged in a memo to Netflix employees that
Friedland “showed unacceptably low racial awareness and sensitivity” and a “deep
lack of understanding,” and that Netflix as a whole “should have done more” upon
learning of Friedland’s conduct, but instead allowed the issue to remain
unsatisfactorily addressed for too long. (Id. ¶ 28). CEO Hastings purportedly said
that it was his own “privilege [that] has made [him] intellectualize or otherwise
minimize race issues like this” and he agreed that he “need[s] to set a better
example[.]”

Overall, Plaintiff alleges that the 2017 incident involving Friedland is

evidence of Netflix’s “corporate culture of insensitivity and/or discriminatory
treatment of Black workers within Netflix’s operations.” (Id. ¶ 26). Even still,
Defendant argues that “Plaintiff does not allege that this incident has anything to
do with her claims” because (1) she does not claim that Friedland himself “had any
involvement in the negotiation for Plaintiff to produce a comedy special for the
Netflix streaming service,” and (2) she does not “assert that she in any way was
harmed by the employee’s conduct.” (MTS at 3).

Defendant’s interpretation of relevance here is far too narrow, and the Court
finds that the Friedman allegations are relevant in Plaintiff’s action, as several of
her claims require her to prove pretext by way of discriminatory intent or animus.
(MTS Opp’n at 4). Courts have declined to strike matter from employment
discrimination complaints with only thin relevance on a claim, and at least in one
instance, even on a claim that was dismissed. For example, in Anderson v. Davis
Polk & Wardwell LLP, 850 F. Supp. 2d 392, 414, 418 (S.D. N.Y. 2012), the Court
found that even “allegations regarding a purported article” from years ago “about

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[an employer’s] treatment of [B]lack attorneys [were] relevant, albeit quite

remotely to” to a plaintiff’s unmeritorious race discrimination claim. Here, a senior
executive using a racial slur at a meeting in front of about 60 employees is
arguably far more relevant and probative of potential discriminatory intent or
animus on Defendant’s part. Accordingly, the Court is not prepared at this juncture
to say that these allegations do not bear on Defendant’s motive or intent, or even to
Plaintiff’s claim that Defendant failed to prevent discrimination.

Further, “[d]iscriminatory statements,” such as the use of a racial epithet,

“may reflect a cumulative managerial attitude among the defendant-employer’s
managers that has influenced the decisionmaking process for a considerable time,”
even if spoken in a context not directly involving the present plaintiff. Ercegovich
v. Goodyear Tire & Rubber Co., 154 F.3d 344, 356 (6th Cir. 1998). Even
Defendant points out that “the courts must carefully evaluate factors affecting the
statement’s probative value, such as the declarant’s position in the corporate
hierarchy, the purpose and content of the statement, and the temporal connection
between the statement and the challenged employment action.” Id. at 357 (citations
omitted). This careful evaluation is not appropriate at this early stage on a motion
to strike; it is better suited for the motion in limine stage.

Because “[a] court must deny the motion to strike if there is any doubt
whether the allegations in the pleadings might be relevant in the action,” the Court
declines to strike paragraphs 26–29, which are not immaterial or impertinent.
Oracle Am., Inc., 817 F. Supp. 1132.

(3) The Court STRIKES paragraphs 30–33 alleging that

then-star of Netflix’s hit show House of Cards
behaved in a racist and discriminatory matter against
security guards working on the show’s set in 2012,
finding that these allegations are irrelevant and
impertinent.

Paragraphs 30–33 (“the Spacey Allegations”) allege that Kevin Spacey

(“Spacey”), then-star of Netflix’s hit show House of Cards, behaved in a racist and
discriminatory manner against security guards working on the show’s set.
Specifically, Plaintiff alleges that during the show’s first season in 2012, VIP
Protective Services (“VIP”), a professional security company which employed a
number of Black guards, contracted to provide security services for the show.
(Compl. ¶ 31). According to Plaintiff, based on reports from VIP’s head, Earl Blue
(“Blue”), Spacey engaged in a number of racist acts toward the Black guards,

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including using the n-word to describe them, and refusing to acknowledge, shake
hands with, or speak with them. (Id. ¶ 32). Plaintiff further alleges that Blue
reported raising concerns about Spacey’s conduct, but the set managers responded
that “That’s just the way he is; we’ve got to keep him happy” and referring to him
as “the Powers that be.” (Id.¶ 33). After that, VIP’s contract was purportedly not
renewed, although the show’s producers said they were pleased with the
company’s work. (Id.).

Here, the Court finds that the Spacey allegations are irrelevant and
impertinent. As Defendant points out, “Plaintiff does not allege that Mr. Spacey’s
alleged conduct in 2012 had anything to do with negotiations more than 5 years
later” for her to produce a comedy special for Netflix. (MTS at 4) (emphasis in
original). Defendant essentially conceded as much at oral argument on February
28, 2020. Finding no legal relevance of Spacey’s allegation to Plaintiff’s
underlying dispute, and “to avoid the expenditure of time and money that must
arise from litigating spurious issues” posed by the Spacey allegations, the Court
STRIKES paragraphs 30–33. Whittlestone, 618 F.3d at 973.

(4) The Court declines to strike paragraphs 34–36

alleging that Netflix’s CEO imposed a gender-based
double-standard in asking Netflix’s Chief Talent
Officer to explain an expense, finding these
allegations potentially relevant to Plaintiff’s claims.

Paragraphs 34–36 (“the Expense Allegations”) concern an undated incident

in which CEO Hastings asked Netflix’s Chief Talent Officer Tawni Nazario-Cranz
(“Nazario-Cranz”) to “sunshine,” or explain why she had expensed the costs of
hair and make-up for some of her team members before they attended a launch
event in Milan. (Compl. ¶ 35). Plaintiff alleges that Nazario-Cranz pointed out the
obvious double-standard, noting that if a manager had taken two male team
members out for a round of golf and expensed the outing, nobody at Netflix would
second-guess that decision. (Id.). Plaintiff further alleges that Nazario-Cranz’s
comments triggered a discussion of gender inequity in the workplace, and
according to purported public reports, soon after this encounter with CEO
Hastings, Nazario-Cranz departed from the company, raising the question of
whether such departure was retaliatory. (Id. ¶ 36).

Again, at this early stage, the Expense Allegations, appear relevant to

Plaintiff’s claims, as they may shed light on Defendant’s corporate culture
regarding potential differential treatment of women, especially given the

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involvement of the CEO and a high-level executive. As these allegations may bear
on discriminatory intent on the basis of gender, and it is too early to tell for sure at
this point, the Court declines to strike paragraphs 34–36.

(5) The Court declines to strike paragraphs 37–40

alleging that in 2018, Netflix was forced to correct a
gender-based pay disparity of a female actress on its
show, The Crown, which prompted an investigation
into cast salaries across Netflix’s productions, finding
these allegations relevant to Plaintiff’s claims.

Paragraphs 37–40 (“The Crown Allegations”) allege that in or around March

2018, a gender-based pay inequity came to light regarding an actress’ salary on
Netflix’s show, The Crown. Specifically, Claire Foy (“Foy”), who played the lead
role of Queen Elizabeth II on The Crown, was paid nearly $14,000.00 less per
episode than male actor Matt Smith, who played the supporting role of Prince
Philip. (Compl. ¶ 38). Plaintiff alleges that after this gender-based pay inequity was
exposed in the public spotlight, Netflix paid Foy $275,000.00 in back pay. (Id.).
Plaintiff further alleges that, faced with public outrage about unfair pay within its
shows, Netflix’s Chief Content Officer Ted Sarandos (“Sarandos”) publicly
declared that The Crown incident prompted Netflix to review cast salaries across
all the company’s productions (including those done in-house and by third parties),
which uncovered additional unspecified pay inequities. (Compl. ¶ 39). According
to Plaintiff, Sarandos publicly acknowledged a pay gap problem within Netflix
productions, stating that “[I]n general there was a disparity” which “prompted
[Netflix] to go back and look at all of [its] productions” to check for disparities.
(Id.). Sarandos purportedly stated that, through its investigation, Netflix found and
adjusted a salary of an unnamed female executive who was being paid less than her
male counterparts had historically received for the same position. (Id.).

Here, the Court finds that The Crown Allegations are plainly relevant to
Plaintiff’s claims of gender-based discrimination. The results of Netflix’s internal
investigation of salaries across its productions may be probative of a
discriminatory corporate culture, if found to show that Netflix generally pays
women (and/or Black women) less for same or similar roles. Netflix disagrees,
asserting that The Crown allegations show that “Netflix condemned any real or
perceived inequity or discrimination,” and thus demonstrate that the company
adjusted salaries retroactively and proactively reviewed and adjusted salaries
across its productions. (MTS Reply at 7–8). Given this argument, the Court finds

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that Netflix is not prejudiced by The Crown Allegations, as they may lead to
evidence of Netflix’s good-faith efforts to rectify a purported problem.

Again, “[m]atter will not be stricken from a pleading unless it is clear that it
can have no possible bearing upon the subject matter of the litigation[.]” Clark,
231 F.R.D. at 406. Finding that The Crown Allegations may bear on Plaintiff’s
claims here, the Court declines to strike paragraphs 37–40.

IV. CONCLUSION

For the foregoing reasons, Defendant’s Motion to Dismiss is GRANTED

and Plaintiff’s Fifth and Eighth Claims are DISMISSED with leave to amend.
The retaliation portion of Plaintiff’s Sixth Claim is also DISMISSED with leave
to amend. Defendant’s Motion to Strike is GRANTED in part and DENIED in
part. Plaintiff is hereby ORDERED to file her First Amended Complaint within
14 days of the issuance of this Order, or else waive its Fifth, Sixth, and Eighth
Claims.

IT IS SO ORDERED.

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