Case Summaries: District of Columbia Summaries

September

Court Rules on Privilege Issues

Segar et al. v. Holder et al., No. 77-81 (EGS/JMF) (D.D.C. Sept. 26, 2011).

In the Segar class action against the Department of Justice, pending since 1977, Magistrate Judge Facciola holds:

1. deliberative process privilege may not be used by a federal agency where intent is at issue; and

2. attorney-client privilege objection to discovery is waived if not raised in response within 30 days of service of discovery.

The opinion is available on-line at: https://ecf.dcd.uscourts.gov/cgi-bin/show_public_doc?1977cv0081-334.

– submitted by Joel P. Bennett

September

Court of Appeals Vacates Decision Adopting Heightened Pleading Standards

Mazza v. Housecraft LLC, No. 09-CV-1068 (D.C. 2011). The original decision is at 18 A.3d 786; and the order vacating it is at 22 A.3d 820.

The D.C. Court of Appeals, thanks to an amicus brief filed by the D.C. Trial Lawyers Association (TLA), has vacated its April 28, 2011 opinion in which the court adopted the Twombly / Iqbal pleading standards in a home improvement contract dispute where the plaintiff-appellant was pro se. The DC TLA commissioned the Center for Constitutional Litigation to draft the successful brief.

The decision is availableon - line at: http://www.dcappeals.gov/dccourts/appeals/pdf/09-CV-1068_MTD.PDF (vacating prior opinion).

– submitted by Alan R. Kabat

September

Decision Discusses Standard of Proof for Wrongful Discharge in Violation of Public Policy Claim and Individual Liability

Myers v. Alutiiq Intl. Solutions LLC, et al., No. 10- CV-2041 (ABJ), 2011 WL 4018230 (D.D.C. Sept. 12, 2011).

Judge Amy Jackson of the U.S. District Court recently issued a good decision that addresses two somewhat unsettled issues relating to the commonlaw wrongful termination in violation of public policy claim.

Judge Jackson finds that (1) the employee does not have to prove an actual violation, only that the employee had a reasonable belief that the employer was violating the law; and (2) that there can be individual liability on this claim. In the past, individual defendants usually had to be brought in on a civil conspiracy claim, but if this ruling gets adopted by other courts, then it may be simpler to plead the individual defendants on the wrongful termination claim.

This plaintiff worked for a government contractor that provided services to the Department of State.

Some excerpts follow - emphasis added:

. . . . Plaintiff's complaint raises the question of whether reporting wrongdoing in connection with government contracting falls within the public policy exception to an at-will employment relationship. 5 U.S.C. § 2302 reflects a clear public policy of encouraging government employees to come forward and report possible problems in federal programs, and there are many other whistleblower protection statutes that protect not only government employees, but private sector employees as well. See, e.g., 15 U.S.C. § 2087 (Consumer Product Safety Improvement Act); 18 U.S.C. § 1514A (SarbanesOxley Act); 29 U.S.C. § 660 (Occupational Safety & Health Act).

The Federal Acquisition Regulations ("FAR") express a policy that contractors avoid or mitigate organizational conflicts of interests and state that "[e]ach individual contracting situation should be examined on the basis of its particular facts and the nature of the proposed contract." 48 C.F.R. § 9.505. The FAR also prohibits personal conflicts of interest . . . . 48 C.F.R. § 3.101-1. The FAR further prohibit employers from "discharg[ing], demot[ing] or otherwise discriminat[ing] against an employee as a reprisal for disclosing information to ... an authorized official of an agency ... relating to a substantial violation of law related to a contract...." 48 C.F.R. § 3.903.

Plaintiff alleges that the close personal relationship between the COR, Bailey, and a government contractor, Lori Strickland, violated federal contracting regulations. Compl. ¶ 45. He further alleges that his employers knew that he reported those violations to his supervisors and to the OIG. Id. ¶ 46. Finally, he alleges that he was fired immediately after the OIG concluded that most of his allegations were substantiated and that Bailey and Lori Strickland were subject to discipline. Id. ¶ 47. Accepting plaintiff's allegations as true and resolving all inferences in his favor, as the Court must do at this juncture, plaintiff in this case has alleged sufficient facts to state a claim under the Carl public policy exception to the general rule against wrongful discharge claims by at-will employees. See Ware v. Nicklin Assocs., Inc., 580 F.Supp.2d 158 (D.D.C.2008) (finding that plaintiff stated a wrongful discharge claim where she alleged she had knowledge of an illegal billing scheme, her employers were aware of her knowledge, and she was fired because of that knowledge).

Defendants argue that plaintiff "cannot and does not explain how COR Bailey's alleged actions constituted a 'substantial violation of law' under these sections so as to make applicable FAR 3.903." Defs.' Reply at 3. But plaintiff is not required to establish here that his employers violated any particular provision of the FAR; the FAR provisions are relevant to this motion because they are illustrative of the strong public policy against conflicts of interest and favoring the protection of whistleblowers. In Vreven, the plaintiff had reported concerns to her supervisors that the defendant was evading taxes in violation of the Internal Revenue Code. 604 F.Supp.2d at 11. The court held that the plaintiff stated a claim for wrongful discharge under Twombly and the Carl standard even though she had not specified the manner in which the defendant allegedly violated its tax exempt status. The court found that the allegations "make plausible the conclusion that defendant discharged plaintiff as a result of her objections to alleged violations of defendant's tax exempt status." Id. at 14. Here, plaintiff has alleged sufficient facts to make plausible the conclusion that defendants fired him in retaliation for reporting alleged violations of federal contracting regulations.

ii. Plaintiff states a claim for wrongful termination against the individual defendants

The individual defendants argue that they cannot be held liable as a matter law for a wrongful termination claim. Although the D.C. Court of Appeals has not addressed this question directly, a review of its opinions in the employment area suggests that it would not bar claims for wrongful discharge against individual employees if the facts established that the individuals acted improperly or illegally. Because the Court must draw all reasonable inferences in plaintiff's favor at this stage, it will allow the wrongful termination claim against the individual defendants to proceed.

Defendants cite decisions of other states holding that individual supervisors cannot be held liable for wrongful termination. Defs.' Mem. at 11.While it is true that some states prohibit wrongful termination suits against individual supervisors, it is equally true that several states allow such claims. See Physio GP, Inc. v. Naifeh, 306 S.W.3d 886, 892 n. 2 (Tex.App.2010) (Hudson, J., dissenting) (collecting cases on the split of authority). The states recognizing individual liability reason that individuals are liable for their own torts, even as agents acting on behalf of their employers. See, e.g., Jasper v. H. Nizam, Inc.,764 N.W.2d 751, 775- 76 (Iowa 2009); Ballinger v. Del. River Port Auth., 800 A.2d 97, 110-11 (N.J.2002); Harless v. First Nat'l Bank in Fairmont, 289 S.E.2d 692, 698-99 (W.Va.1982). According to that logic, employees can be liable for a wrongful discharge claim just as any other tort. See, e.g., Jasper, 764 N.W.2d at 775-76; Ballinger, 800 A.2d at 110-11; Harless, 289 S.E.2d at 698-700. These courts "reason that individual liability promotes deterrence and better decision making because it allows the active wrongdoer to be held directly responsible." Physio, 306 S.W.3d at 888, citing Borecki v. E. Int'l Mgmt. Corp.,n 694 F.Supp. 47, 59 (D.N.J.1988); Jasper, 764 N.W.2d at 776.

On the other hand, the states that do not allow wrongful termination claims against individual supervisors explain that "the employment relationship is the source of the duty in wrongful discharge torts." Physio, 306 S.W.3d at 888. That relationship exists only between employer and employee and not between two employees, and only the employer has the power to terminate an employee. Id. (citations omitted). These courts further reason that individual liability is unnecessary to deter employees "because liable employers will likely take their own measures to deter agents or employees from wrongfully exercising termination authority." Id. at 889. Indeed, fear of liability could discourage supervisors from terminating employers under legitimate circumstances. Id. (citations omitted). Finally, these courts express the concern that it can be difficult to determine which individuals should be liable for a decision to terminate. Id. (citations omitted).

The Court finds the reasoning of the states that have allowed claims against individual employees to be more consistent with the law of the District of Columbia. Although the D.C. Court of Appeals has not directly ruled on this issue in the context of a wrongful discharge action, it has recognized that there may be some circumstances where an individual supervisory employee can be liable for tortious interference with another employee's contractual relations with the employer. . . .

. . . . This holding is in keeping with the reasoning of the courts in other states that allowed wrongful termination claims against individual employees because individuals are liable for their own torts, even as agents acting on behalf of their employers. Therefore, reading Sorrells in conjunction with Carl, the Court finds that the D.C. Court of Appeals would allow claims against individual supervisors for wrongful discharge if it was shown that their conduct was sufficiently wrongful and violative of an important public policy.

The decision is available online at: https://ecf.dcd.uscourts.gov/cgi-bin/show_public_doc?2010cv2041-7.

– submitted by Alan R. Kabat

September

Summary Judgment Denied on Retaliation Claim

Tarick Ali, by his personal representative, Monica Ali v. District of Columbia, No. 08-01950 (HHK) (D.D.C. Aug. 31, 2011)

We recently received an Order from Judge Kennedy denying summary judgment as to a retaliation claim against the District. He relied upon and potentially expanded Thompson v. N. Am. Stainless, 131 S.Ct. 863 (2011). In our case, Plaintiff was "warned" by his supervisor that his best friend would be terminated if Plaintiff proceeded with his complaint. Judge Kennedy questioned where the "best friend" fact "falls on the continuum between "'firing a close family member,' which 'will almost always meet the Burlington standard,' and 'inflicting a milder reprisal on a mere acquaintance,' which 'will almost never do so'" but held that a reasonable juror could find that Plaintiff was dissuaded from complaining due to the threat against his best friend.

He also provided good case law and solid reasoning against the District's silly argument that essentially contended that all or most of the documents used in support of the Opposition could not be relied upon by the Court since they contained hearsay and other evidentiary objections. The District was confusing the evidentiary standard for trial with the evidentiary standard for dispositive motions. This is an argument that we have been required to respond to from the District on another occasion. Hopefully, the District will learn the proper evidentiary standards and forgo this argument in the future.

As usual, Donna Williams Rucker skillfully handled and dominated opposing counsel in arguing this before Judge Kennedy.

– submitted by Mackenzie Coy

September

Trial Court Properly Waited to Rule on Fee Petition

Purcell v. Thomas, Nos. 09-CV-501 & 10-CV-485 (D.C. Sept. 29, 2011).

In Purcell v. Thomas, Nos. 09-CV-501 & 10-CV-485 (D.C. Sept. 29, 2011), the D.C. Court of Appeals held that the trial court acted properly in waiting until after an appeal on the merits (in which the first appeal affirmed the judgment in employee's favor on her DCHRA claims) to decide the employee's long-pending motion for attorney's fees and costs.

The Court of Appeals rejected the employer's odd argument that the trial court somehow no longer had jurisdiction, or that the passage of time since the verdict meant that the employee could no longer seek fees. Here, the jury award was $165,000 (June 2003), which the Court of Appeals affirmed on June 2007. The trial court then awarded $590,807 to the employee for attorney's fees and costs (March 2009).

However, the Court of Appeals rejected the employee's argument on her cross-appeal that the supersedeas bond posted by the employer on appeal should also be used to cover part of the attorney's fees, since the wording of the bond limited it to the judgment, statutory post-judgment interest, and certain costs, for a total of $212,742 which was paid in April 2010. Evidently the employee wanted to use the balance of the supersedeas bond to collect on her attorney's fee award. The employee will now have to see if the employer or its insurance company can pay the attorney's fees and costs, including additional fees/costs arising from the second appeal.

The decision is available online at http://www.dcappeals.gov/dccourts/appeals/pdf/09-CV-501+_MTD.PDF,

– submitted by Alan R. Kabat

September

“Sham Affidavit” Objection is Rejected

Johnson v. Shinseki, Dep’t of Veteran’s Affairs, No.08-1103 (JDB) (D.D.C. Sept. 19, 2011).

Sham affidavit objection to declaration in opposition to summary judgment will be denied when declaration clarifies prior ambiguous deposition testimony or prior affidavit. Summary judgment denied in hostile work environment case.

The decision is available on-lineat : https://ecf.dcd.uscourts.gov/cgi-bin/show_public_doc?2008cv1103-44.

– submitted by Joel P. Bennett

September