Drumm v. Triangle Tech, Inc.
| Decision Date | 18 November 2016 |
| Docket Number | Case No. 4:15-CV-0854 |
| Parties | JOSEPH DRUMM, RONALD MCELWEE, CAROL BECK, LISA DELBAUGH, Plaintiffs, v. TRIANGLE TECH, INC., Defendant. |
| Court | U.S. District Court — Middle District of Pennsylvania |
MEMORANDUM OPINION
Plaintiffs, Joseph Drumm, Ronald McElwee, Carol Beck, and Lisa Delbaugh, hereinafter each referred to by their surname, are all former employees of Defendant, Triangle Tech Inc., hereinafter "Triangle Tech." Defendant is a technical school with several locations throughout the Commonwealth. Plaintiffs were employed by Triangle Tech at its Sunbury, Northumberland County, Pennsylvania location.
Plaintiffs filed their complaint on May 1, 2015, and a motion to dismiss was promptly filed. In ruling on that motion, the Court directed Plaintiffs to file an amended complaint. The amended complaint was filed on April 21, 2016 and is now the operative pleading in this action.1 Plaintiffs bring four counts against Defendant. Count I is a retaliation claim under the federal False Claims Act; Count II is wrongful termination and retaliation claim under Pennsylvania's whistleblower law; Count III is wrongful termination in violation of Pennsylvania's public policy; Count IV is an alternative pleading by Plaintiff McElwee only, alleging termination in violation of the federal Family Medical Leave Act.
The subject of the instant Memorandum Opinion is a motion to dismiss the amended complaint.2 For the reasons that follow, the motion is granted in part and denied in part.
Under Federal Rule of Civil Procedure 12(b)(6), a defendant may file a motion to dismiss for "failure to state a claim upon which relief can be granted." Such a motion "tests the legal sufficiency of a pleading" and "streamlines litigation bydispensing with needless discovery and factfinding."3 "Rule 12(b)(6) authorizes a court to dismiss a claim on the basis of a dispositive issue of law."4 This is true of any claim, "without regard to whether it is based on an outlandish legal theory or on a close but ultimately unavailing one."5
Beginning in 2007, the Supreme Court of the United States initiated what some scholars have termed the Roberts Court's "civil procedure revival" by significantly tightening the standard that district courts must apply to 12(b)(6) motions.6 In two landmark decisions, Bell Atlantic Corporation v. Twombly and Ashcroft v. Iqbal, the Roberts Court "changed . . . the pleading landscape" by "signal[ing] to lower-court judges that the stricter approach some had been taking was appropriate under the Federal Rules."7 More specifically, the Court in these two decisions "retired" the lenient "no-set-of-facts test" set forth in Conley v. Gibson and replaced it with a more exacting "plausibility" standard.8
Accordingly, after Twombly and Iqbal, "[t]o survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to 'state a claimto relief that is plausible on its face.'"9 "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged."10 "Although the plausibility standard does not impose a probability requirement, it does require a pleading to show more than a sheer possibility that a defendant has acted unlawfully."11 Moreover, "[a]sking for plausible grounds . . . calls for enough facts to raise a reasonable expectation that discovery will reveal evidence of [wrongdoing]."12
The plausibility determination is "a context-specific task that requires the reviewing court to draw on its judicial experience and common sense."13 No matter the context, however, "[w]here a complaint pleads facts that are 'merely consistent with' a defendant's liability, it 'stops short of the line between possibility and plausibility of entitlement to relief.'"14
When disposing of a motion to dismiss, a court must "accept as true all factual allegations in the complaint and draw all inferences from the facts alleged in thelight most favorable to [the plaintiff]."15 However, "the tenet that a court must accept as true all of the allegations contained in the complaint is inapplicable to legal conclusions."16 "After Iqbal, it is clear that conclusory or 'bare-bones' allegations will no longer survive a motion to dismiss."17 "Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice."18
As a matter of procedure, the United States Court of Appeals for the Third Circuit has instructed that:
Under the pleading regime established by Twombly and Iqbal, a court reviewing the sufficiency of a complaint must take three steps. First, it must tak[e] note of the elements [the] plaintiff must plead to state a claim. Second, it should identify allegations that, because they are no more than conclusions, are not entitled to the assumption of truth. Finally, [w]hen there are well-pleaded factual allegations, [the] court should assume their veracity and then determine whether they plausibly give rise to an entitlement to relief.19
The Court now turns to the specifics of the instant matter.
Taking the facts alleged in the amended complaint20 as true, as I must when considering a motion to dismiss, the narrative that unfolds is as follows:
Triangle Tech is accredited by, and receives funding from, both the state and federal governments. The events in question here are all alleged to have occurred at its school located in Sunbury, Pennsylvania. Plaintiff Drumm had been employed as the school director. Drumm was responsible for compliance with federal and state laws relating to, inter alia, accreditation and funding. McElwee was the admissions representative; Beck was a career advisor; and Delbaugh was the academic affairs administrative assistant. The Plaintiffs were subsequently terminated by Triangle Tech.
Plaintiffs aver that they are close friends, so close that they share life experiences together, such as inviting each other to weddings, children's birthday parties and graduation parties. Plaintiffs often went to lunch together. Delbaugh's daughter frequently babysat Drumm's children. Drumm and Beck had known each other since 2005, when Beck was a student at the McCann School of Business, where Drumm was then employed. Both Drumm and Delbaugh attended Beck's graduation from McCann School of Business. Drumm later served as areference for Beck when she applied for the career advising position with Triangle Tech. Plaintiffs allege that Defendant was aware of the Plaintiffs' "close personal relationships."
Other individuals who acted on behalf of Defendant are the president of Triangle Tech, Timothy McMahon, hereinafter "McMahon;" the director of financial aid, Catherine Waxter, hereinafter "Waxter;" and the director of career advising, Lisa Capuzzi, hereinafter "Capuzzi." Capuzzi was Beck's supervisor. Deborah Hepburn, hereinafter "Hepburn," was Drumm's "superior."
The amended complaint alleges that on June 5, 2014, Waxter contacted Drumm and asked him to back-date a document to permit a student to receive Title IV funds. Title IV of the Higher Education Act of 1965 provides federal funds for financial assistance for students engaged in higher education. The student had failed to meet satisfactory academic progress requirements,21 and back-dating the document would allow disbursement of funds to Triangle Tech. Drumm believed this to be fraudulent and refused to sign the document that was to be submitted to the United States Department of Education, hereinafter "DOE." Shortly after Drumm refused Waxter's request, he contacted both his own immediate supervisor and the vice president of human resources to advise both that Waxter had asked Drumm to back-date the document. Eventually, someone at Triangle Tech back-dated and submitted the document for federal funds disbursement. On June 18, 2014, the vice president of human resources contacted Drumm and advised that having conducted an internal investigation she had found no evidence of wrongdoing.
Despite the results of the internal investigation, Drumm nevertheless believed that back-dating the document was fraudulent. On his own initiative he contacted the DOE and filed a complaint of wrongdoing by Triangle Tech. Drumm also filed a complaint with the Accrediting Commission of Career Schools and Colleges, hereinafter "ACCSC," and the United States Office of the Inspector General, hereinafter "OIG." On June 25, 2014, Drumm and McElwee met with an investigator from the OIG in what the amended complaint refers to as "the OIG meeting." As part of the investigation, McElwee wrote a statement to the OIG and the DOE. After the OIG meeting, Drumm told Delbaugh and Beck that he and McElwee had the meeting with the OIG.
Throughout July and August 2014, the DOE and OIG conducted an investigation of Triangle Tech, including interviewing employees and examining records; simultaneous with the investigation, Triangle Tech received re-accreditation. Plaintiffs believe the retaliation toward them began during this time.
On August 11, 2014, Hepburn held a mandatory pre-accreditation meeting, at which all four Plaintiffs were present. McMahon was also present, and told the staff that he was extremely disappointed that a complaint had been filed with the DOE. Plaintiffs aver that, at this time, McMahon did not know which employee had filed the complaint. Plaintiffs believed that McMahon was hostile and threatening toward the staff at this meeting.
The DOE then entered its investigatory findings on August 21, 2014. It found that Triangle Tech did improperly receive approximately $70,000 in Title IV funds from October 2011 through February 2014. Evidently, Triangle Tech agreed to return the funds, as the complaint further states that the DOE also found that any wrongdoing on the part of Triangle Tech was corrected upon the return of those monies.
Plaintiff...
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