Anthony v. Atl. Grp., Inc., Civil Action Nos. 8:09–cv–02383–JMC, 8:09–cv–02942–JMC.

• Decision Date: 14 November 2012
• Docket Number: Civil Action Nos. 8:09–cv–02383–JMC, 8:09–cv–02942–JMC.
• Court: U.S. District Court — District of South Carolina
• Parties: William ANTHONY, et al., Plaintiffs, v. The ATLANTIC GROUP, INC. d/b/a DZ Atlantic, Defendant. Charles Adams, et al., Plaintiffs, v. The Atlantic Group, Inc. d/b/a DZ Atlantic, Defendant.

909 F.Supp.2d 455

William ANTHONY, et al., Plaintiffs,

v.The ATLANTIC GROUP, INC. d/b/a DZ Atlantic, Defendant.

Charles Adams, et al., Plaintiffs,

v.The Atlantic Group, Inc. d/b/a DZ Atlantic, Defendant.

Civil Action Nos. 8:09–cv–02383–JMC, 8:09–cv–02942–JMC.

United States District Court,

D. South Carolina,

Anderson Division.

Nov. 14, 2012.

Lucy Clark Sanders, Nancy Bloodgood, Foster Law Firm, Daniel Island, SC, for Plaintiffs.

Kristin Starnes Gray, Leland Grant Close, III, Matthew J. Gilley, Wade Edward Ballard, Ford And Harrison, Spartanburg, SC, for Defendant.

ORDER AND OPINION

J. MICHELLE CHILDS, District Judge.

Plaintiffs in these cases are former employees of Defendant The Atlantic Group, Inc., doing business as DZ Atlantic (“DZ Atlantic”).¹ DZ Atlantic employed Plaintiffs as temporary, seasonal, and contract workers at nuclear power facilities in South Carolina and North Carolina owned by Duke Energy Carolinas, LLC (“Duke”). DZ Atlantic terminated Plaintiffs' employment after concluding Plaintiffs provided inaccurate information regarding their permanent residences on per diem eligibility forms submitted to DZ Atlantic. DZ Atlantic reported Plaintiffs' terminations to Duke, and as a result, Plaintiffs lost their unescorted access authorization for nuclear facilities around the country—a penalty that lasts for at least three years and prevents Plaintiffs from applying their trade in the nuclear industry. Plaintiffs allege that the circumstances surrounding their terminations were wrongful, negligent and fraudulent. Plaintiffs seek actual, consequential, and punitive damages for their claims. Additionally, Plaintiffs seek equitable relief in the form of rescission of their termination and/or modification of the reason for their termination.

DZ Atlantic argues that Plaintiffs' action against it, although creatively labeled, amounts to nothing more than a wrongful termination claim and that Plaintiffs' primary complaint against DZ Atlantic stems from DZ Atlantic's classification of Plaintiffs' terminations and subsequent reporting of those classifications to Duke. Without making any concessions, DZ Atlantic contends that its conduct in reporting Plaintiffs' terminations to Duke, if at all actionable, is more in the nature of a claim for defamation and does not arise under the claims presently asserted by Plaintiffs.² Instead, DZ Atlantic contends that it has been victimized by Plaintiffs' wrongful receipt of per diem payments, which Plaintiffs must refund. Accordingly, DZ Atlantic counterclaimed against Plaintiffs, alleging causes of action for unjust enrichment, conversion, promissory estoppel, fraud, intentional misrepresentation, breach of duty of loyalty, and civil conspiracy. Currently before the court is Defendant's Motion for Summary Judgment in both cases. [Dkt. No. 228 in 8:09–cv–02383–JMC] pursuant to Rule 56 of the Federal Rules of Civil Procedure and the Local Rules of this court. For the reasons set forth below, this court denies in part and grants in part DZ Atlantic's motion.³

FACTUAL AND PROCEDURAL BACKGROUND

DZ Atlantic is in the business of supplying maintenance services for the fossil fuel and nuclear power industry. Specifically, it supplies temporary, seasonal and contract trades people to staff power stations across the country. Plaintiffs were employed for various temporary work assignments at the Catawba Nuclear Station in York County, South Carolina, the Oconee Nuclear Station in Oconee County, South Carolina, and the McGuire Nuclear Station in Mecklenburg County, North Carolina, all of which are operated by Duke.

As employees of DZ Atlantic, Plaintiffs were subject to the safety regulations and work rules as described in the Employee Handbook ⁴ given to all employees. [Dkt. No. 228–3]. Plaintiffs were required to sign acknowledgments that they had received and read the handbook with the understanding that they were expected to be familiar with the policies and procedures described within it. Plaintiffs were also subject to unescorted access authorization programs (“UAA programs”), which are a component of a larger safety regime mandated by federal regulations and for which guidelines were written and promulgatedby the Nuclear Energy Institute (NEI), a private consortium of nuclear power operators around the country. These programs facilitate the investigation of employees whose jobs require unescorted access to sensitive nuclear facilities to minimize security risks. For this reason, nuclear power plant licensees (here, Duke) and/or the vendors (here, DZ Atlantic) providing contractors are required to conduct background investigations of employees given unescorted access authorization to nuclear facilities. DZ Atlantic disclosed this requirement to all employees in the Employee Handbook and also disclosed it in a separate consent document, signed by the employees during the hiring process, which authorized DZ Atlantic to share with its clients any information relevant to those employees granted unescorted access authorization. Further, DZ Atlantic was required to report to Duke the circumstances under which any employee was unfavorably terminated, and Duke had the authority to determine whether the unfavorable termination would impact that employee's unescorted access authorization. See infra note 11.

As temporary, seasonal, and contract trade workers, some of DZ Atlantic employees did not reside in the area where they were assigned to work. For these non-local employees, DZ Atlantic offered a non-taxable per diem allowance to defray the costs of duplicate living expenses.⁵ To qualify for the per diem program, employees were required to complete and sign a Certificate of Per Diem Eligibility (“Certificate”). [Dkt. No. 272–1, at 85–91]. The Certificate explained that eligibility for the per diem program was “contingent upon maintenance of a permanent residence 50 miles or more away from [the employee's assigned work] site and maintaining a separate residence while employed.” Id. As proof of their permanent address, employees also had to provide at least two of the following pieces of documentation: a valid driver's license, a mortgage document, a current voter registration, or a current utility bill.⁶id. By signing the Certificate, the employee certified that the information provided in the Certificate was “true and accurate.” Id. The signer also agreed to “reimburse to DZ Atlantic any money that has been wrongfully paid for per diem and ... that DZ Atlantic has the right to use all legal means to recoup these monies.” Id. The form also required a DZ Atlantic representative to sign and date the Certificate “attest [ing] to having viewed the appropriate original documentation.” Id.⁷

On or about March 2009, Duke began receiving anonymous calls to its ethics hotline claiming that some of DZ Atlantic employees were wrongfully receiving per diem compensation. Given the volume of the calls to Duke's hotline, DZ Atlantic began an investigation into all of its employees who received per diem payments.⁸ In the initial investigation, DZ Atlantic compared the addresses listed by the employees on their employment documents with addresses provided by an online information service. DZ Atlantic concluded that 209 employees should be interviewed in person about discrepancies in their residence information. DZ Atlantic ultimately terminated 145 employees whom it believed had not been truthful and accurate in their documentation or who had refused to cooperate with the investigation. ⁹ When these employees were fired, DZ Atlantic listed the reason for their termination as “falsification of documents.” Because these firings were considered unfavorable terminations, DZ Atlantic acted pursuant to its interpretation of the UAA program and federal regulations,¹⁰ and it provided this information to Duke.¹¹ Shortly thereafter, Duke revoked Plaintiffs' unescorted access authorization, and it informed Plaintiffs of its decision by letter.

Plaintiffs note that at or around the same time that DZ Atlantic was beginning its investigations, Duke was implementing a Local Supplemental Workforce Program, in which Duke expressed its preference for hiring local workers in an attempt to both control its costs and contribute to the local economy. See Ron Jones Memorandum [Dkt. No. 40–17]. The new policy stated that workers who declared themselves “local” (that is, living within 50 miles of an employee's work site) would be favored for more permanent employment with Duke. Id. DZ Atlantic supervisors informed their employees about the preference for local workers and many workers decided to declare themselves “local” to obtain a permanent job with Duke. Plaintiffs contend that DZ Atlantic supervisors also encouraged its employees to no longer claim their per diem status if they wanted to continue working with Duke. Plaintiffs further claim that those Plaintiffs who dropped their per diem eligibility and declared themselves local were among the first people to be investigated for unauthorized receipt of per diem payments. This is an element in Plaintiffs' larger narrative that DZ Atlantic employees cost Duke too much money in per diem payments, and that DZ Atlantic actively sought to reduce the number of people receiving per diem compensation, despite having encouraged these employees to receive the alleged illicit per diem payments.

Sixty (60) of the terminated workers, of which forty-nine (49) remain, brought the present action against DZ Atlantic.¹² In their amended complaints, Plaintiffs allege the following causes of action: breach of contract/wrongful termination; breach of contract accompanied by a fraudulent act; promissory estoppel; negligence and/or gross negligence; negligent or intentional misrepresentation; and fraud in the inducement. DZ Atlantic filed several counterclaims against all Plaintiffs but seek summary judgment only as to its claims for unjust enrichment, conversion and promissory...