The California Court of Appeals, Second Appellate District, decision in Carranza v. City of Los Angeles on May 23, 2025 sends a clear message to California employers about the changing landscape of how courts view sexual harassment claims and highlights the responsibility of every California employer to take all employee complaints of harassment, discrimination, and retaliation seriously, by following up with an immediate and effective response.

Background

Lillian Carranza, a captain in the Los Angeles Police Department (LAPD), learned in November 2018 that an AI-generated photo of a topless woman falsely said to be her was spreading electronically among LAPD personnel. Carranza was told that officers were talking about the photo and making lewd comments about her while on-duty. The Department did not take action on Carranza’s request to notify its employees that the photo was not of her, and to direct them to stop sharing it.

Carranza immediately filed a complaint with the Agency that receives sexual harassment complaints from City employees. Carranza interviewed with the Agency Investigator in December 2018 and requested that LAPD do two simple things: (1) find the source of the photo, and (2) notify employees that sharing it would be considered misconduct. The investigator reported Carranza’s concerns. However, the LAPD did not send any communication to its employees. In January 2019, Carranza learned that the photo continued to be spread, with lewd comments made about her. Carranza filed suit against the City of Los Angeles for sexual harassment based on a hostile work environment in January 2019 under California’s Fair Employment and Housing Act (FEHA).

The LAPD completed its internal investigation of Carranza’s complaint in August 2019 – nine months later, sustaining Carranza’s allegation that this fake photo had been circulated within the Department and that it violated LAPD’s sexual harassment policies. In September 2022, after a one-week trial, Carranza was awarded $4 million, when a jury found the City liable for sexual harassment.

Court’s Findings

The Court of Appeals upheld the $4 million jury verdict against the City and upheld an awarding of Carranza’s reasonable attorneys’ fees and costs, which totaled over $610,000. They found that Carranza presented substantial evidence to show that the harassment was sufficiently severe or pervasive to create a hostile work environment. The Court noted that Carranza shared only one instance of hearing that the photo had been shared among on-duty personnel and had a reasonable understanding that the photo was circulated among “dozens if not hundreds of officers.” The Court dismissed the City’s argument that FEHA requires “direct interactions” of harassment or direct “sexual hostility” in day-to-day work. The Court also discussed the LAPD’s lack of response to Carranza’s requests to order LAPD officers to stop sharing the photo, and their decision to not discipline anyone involved. The Court found these facts spoke to the insufficiency of the LAPD’s response to a complaint of harassment as well as the pervasiveness and severity of the harassment itself and supported the jury’s verdict.

Key Employer takeaway

This case can be seen as a trend and warning for all employers to ensure that they do more than training and circulating policies but rather create an effective complaint and response system. This is not only a legal obligation, but as is evident in the Carranza case, a measure to establish a defense to employment lawsuits.

FEHA obligates an employer to take all reasonable steps to stop and prevent harassment and discrimination from occurring; and employers may limit their potential damages if they are able to show that they responded effectively to complaints. In Carranza, the harassment continued well after the complaint was made, and during the length of the internal investigation, since LAPD did not send communication to personnel directing them to stop circulating the photo. Employers should promptly take action to help stop the alleged harassment. This can include placing an employee on leave, changing an employee’s work location or schedule, or taking immediate corrective action, which LAPD failed to do.

FEHA’s obligation on employers to take reasonable steps to prevent harassment and discrimination from occurring includes engaging in prompt, thorough, and impartial investigations of complaints. While the LAPD did commence an investigation, it took nine months to complete the investigation and substantiate that sharing the photo was a violation of LAPD’s policies. This lack of follow-through led to an escalation of issues and increased legal risk. Employers should be mindful in promptly choosing an investigative team with the experience and resources needed to conduct a timely yet thorough investigation when a complaint is filed.

Carranza is a new warning that employers should not pre-emptively make decisions as to what is or is not a valid allegation of harassment. The era of minimizing or narrowly interpreting sexual harassment claims is over. The law demands vigilance, empathy, and decisive immediate action. By embracing these principles, employers can not only reduce their legal exposure but also create safer, more respectful workplaces for all. The message from the California courts is clear: protecting employees from harassment is not just a legal obligation, but a moral imperative that requires a commitment and cultural change away from only “direct” instances of harassment to scenarios involving indirect communication, rumors, sharing of inappropriate content (even if the victim isn’t present), and social media use that spill into the workplace. Employers should take all complaints seriously and proceed in a prompt and effective manner once they are received.

If you have questions about how this decision may impact your business or need advice, please contact us.

• Kim A. Edmunds (kedmunds@wilsonturnerkosmo.com)
• Lonny M. Zilberman (lzilberman@wilsonturnerkosmo.com)

Wilson Turner Kosmo’s Special Alerts are intended to update our valued clients on significant employment law developments as they occur. This should not be considered legal advice.