                           NOT FOR PUBLICATION                           FILED
                    UNITED STATES COURT OF APPEALS                       AUG 15 2017
                                                                      MOLLY C. DWYER, CLERK
                                                                       U.S. COURT OF APPEALS
                           FOR THE NINTH CIRCUIT

KENNETH DAY,                                    No.    16-15607

                Plaintiff-Appellant,            D.C. No. 4:11-cv-00186-CKJ

 v.
                                                MEMORANDUM*
LSI CORPORATION, FKA LSI Logic
Corporation,

                Defendant-Appellee.

                   Appeal from the United States District Court
                            for the District of Arizona
                   Cindy K. Jorgenson, District Judge, Presiding

                           Submitted August 11, 2017**
                              Pasadena, California

Before: FARRIS, CALLAHAN, and OWENS, Circuit Judges.

      Plaintiff Kenneth Day appeals from the district court’s grant of summary

judgment to Day’s former employer, Defendant LSI Corporation, on breach of

contract, discrimination, retaliation, and other employment related claims. As the



      *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
      **
             The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
parties are familiar with the facts, we do not recount them here. We have

jurisdiction pursuant to 28 U.S.C. § 1291, and we affirm.

      1. First, Day argues that LSI waived its statute of limitations affirmative

defense by not raising it until its motion for summary judgment. But an

affirmative defense may be first asserted in a motion for summary judgment as

long as there was not prejudice to the plaintiff. See Rivera v. Anaya, 726 F.2d 564,

565 (9th Cir. 1984) (affirming district court’s grant of partial summary judgment

wherein the defendant’s “failure to raise the statute of limitations as a defense in

response to the first pleading did not serve to waive his right to raise it later absent

prejudice to plaintiffs”). Day had almost three years of notice on LSI’s arguments

regarding the statute of limitations and never responded to the arguments when he

eventually opposed summary judgment. Thus, he cannot show that he was

prejudiced. Furthermore, as Day did not respond to LSI’s statute of limitations

argument in the district court and raises this challenge for the first time on appeal,

he has waived the argument. See Costanich v. Dep’t of Soc. & Health Servs., 627

F.3d 1101, 1110 (9th Cir. 2010). Accordingly, the district court correctly held that

the statute of limitations barred Day’s breach of contract claim with respect to the

promotion to Vice President or Fellow, breach of implied covenant of good faith

and fair dealing claim, and claim regarding the 30,000 stock grant.

      2. Second, Day alleged under Title VII of the Civil Rights Act, 42 U.S.C.


                                           2
§ 2000e, that LSI intentionally discriminated against him by demoting him,

attempting to force him to quit his job, making him report to one of his previous

employees, and failing to investigate complaints of discriminatory comments.

      With respect to Day’s alleged discrete acts of discrimination, the district

court held that Day established a prima facie case of discrimination because there

was a genuine dispute as to whether Day suffered an adverse action, as Day’s

reassignment to a new position reporting to a former employee could represent a

demotion. But Day does not succeed in establishing his claim for discrimination

based on this act because LSI had a legitimate, nondiscriminatory reason for

demoting Day – declining business conditions and a hiring freeze. We have held

that “[i]n response to the defendant’s offer of nondiscriminatory reasons, the

plaintiff must produce ‘specific, substantial evidence of pretext.’” Wallis v. J.R.

Simplot Co., 26 F.3d 885, 890 (9th Cir. 1994) (citation omitted). Day failed to

provide evidence that LSI’s purported reasons for this adverse action were pretext.

Therefore, the district court correctly held that Day could not prevail on his

discrimination claim based on discrete discriminatory acts.

      With respect to Day’s hostile work environment claim, the district court

properly considered whether “the conversation with Huber, the stripping of Day’s

job duties and supervisory roles without any explanation or justification, and the

disputes between LSI and Day regarding the bonus and stock decisions and Vice


                                          3
President title” were sufficiently severe or pervasive. See Nat’l R.R. Passenger

Corp. v. Morgan, 536 U.S. 101, 116 (2002). The circumstances Day alleges

contributed to a hostile work environment do not rise to the level of “severe or

pervasive” conditions. Accordingly, the district court properly addressed Day’s

hostile work environment claim and properly granted summary judgment to LSI.

      With respect to Day’s retaliation claim, the district court granted summary

judgment because there was no evidence that LSI took any adverse action against

Day after he reported the alleged discriminatory conduct. Day does not challenge

this finding on appeal. Accordingly, the district court properly granted summary

judgment on Day’s retaliation claim.1

      3. Finally, Day argues that LSI destroyed relevant documents and that this

spoliation of evidence warrants a reversal of the district court’s summary

judgment. Day fails to demonstrate that the district court abused its discretion in

ultimately determining that a monetary sanction was sufficient, and vacating its

prior order imposing a default judgment on one claim and adverse inference jury

instructions on the rest of the claims. See Leon v. IDX Sys. Corp., 464 F.3d 951,

961 (9th Cir. 2006). Accordingly, the district court did not abuse its discretion in

not issuing harsher sanctions for LSI’s spoliation.


1
 We reject Day’s argument that the district court erred by determining that his
discrimination and retaliation claims arose only under federal law, and not also
under Arizona state law.

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AFFIRMED.




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