(I just had a flash back to my teachers always saying: "I don't give grades, you earn them"... but I digress)
A copy of the complaint is here, courtesy of TMZ. Obviously, the media is going crazy over the James Franco part, but the case is based on racial discrimination and harassment, and retaliation. The professor claims he had an inferior office (described as a supply closet), he was paid less, and he was denied reappointment (ordinarily a "mere formality") because of his race.
I actually found the Franco discussion a bit odd. The complaint discusses a conflict of interest with Franco hiring another professor, and mentions that Franco missed 12 of 14 classes (thus earning his D - although, it makes you wonder what it takes to get an F!). It's not clear to me how this supports the discrimination claim. If he was actually let go because he gave Franco a D, then that sounds like a non-discriminatory reason, doesn't it?
We'll have to wait and see how it plays out. Here is a YouTube clip of Franco discussing his D (email subscribers can click here to view online):
Posted by Philip Miles, an attorney with McQuaide Blasko in State College, Pennsylvania in the firm's civil litigation and labor and employment law practice groups.