Gantt v. Sentry Insurance

• Decision Date: 27 February 1992
• Docket Number: No. S014212,S014212
• Citation: 1 Cal.4th 1083,824 P.2d 680,4 Cal.Rptr.2d 874
• Court: California Supreme Court
• Parties: , 824 P.2d 680, 59 Empl. Prac. Dec. P 41,597, 60 USLW 2569, 121 Lab.Cas. P 56,853, 7 IER Cases 289 Vincent A. GANTT, Plaintiff and Respondent, v. SENTRY INSURANCE et al., Defendants and Appellants.

Page 874

4 Cal.Rptr.2d 874

1 Cal.4th 1083, 824 P.2d 680, 59 Empl. Prac. Dec. P 41,597,

60 USLW 2569, 121 Lab.Cas. P 56,853, 7 IER Cases 289

Vincent A. GANTT, Plaintiff and Respondent, v. SENTRY INSURANCE et al., Defendants and Appellants.

No. S014212.

Supreme Court of California,

In Bank.

Feb. 27, 1992.

Hanson, Bridgett, Marcus, Vlahos & Rudy, Douglas H. Barton and Bonnie Kathleen Gibson, San Francisco, for defendants and appellants.

Proskauer, Rose, Goetz & Mendelsohn, Steven G. Drapkin, Philip L. Ross, O'Melveny & Myers, Stephen P. Pepe and Craig A Horowitz, Los Angeles, amici curiae, for defendants and appellants.

Matheny, Poidmore & Sears, Anthony J. Poidmore and Michael A. Bishop, Sacramento, for plaintiff and respondent.

Joseph Posner, Encino, amicus curiae, for plaintiff and respondent.

ARABIAN, Justice.

We granted review in this case to consider whether an employee who was terminated in retaliation for supporting a coworker's claim of sexual harassment may state a cause of action for tortious discharge against public policy and, if so, whether the exclusive remedy provisions of the Workers' Compensation Act bar the action. We hold that the claim is actionable under Tameny v. Atlantic Richfield Co. (1980) 27 Cal.3d 167, 164 Cal.Rptr. 839, 610 P.2d 1330 (Tameny ), and is not preempted by the workers' compensation law.

I. PROCEDURAL BACKGROUND

Defendants, Sentry Insurance (Sentry), Frank Singer (Singer) and Caroline Fribance (Fribance) appealed from a judgment entered on a jury verdict of $1.34 million in favor of plaintiff, Vincent A. Gantt (hereafter plaintiff or Gantt) in his action for tortious discharge in violation of the covenant of good faith and fair dealing and in contravention of public policy (Tameny, supra, 27 Cal.3d 167, 164 Cal.Rptr. 839, 610 P.2d 1330), defamation, and intentional infliction of emotional distress.

The Court of Appeal reversed the judgment as to the individual defendants but affirmed in all other respects. As to the Tameny cause of action, the Court of Appeal noted that the allegation was predicated upon two distinct theories: the first, that plaintiff was constructively discharged in retaliation for supporting a coworker's claim of sexual harassment; and second, that Sentry attempted to induce plaintiff to give false information or to withhold information from the public agency investigating the sexual harassment charges. Although the Court of Appeal concluded that Gantt's first theory of recovery was preempted by the California Fair Employment and Housing Act (FEHA), it held that the FEHA did not preempt a Tameny claim premised on the second theory; that substantial evidence supported the jury's special verdict; and that the action was not barred by the exclusive remedy provisions of the Workers' Compensation Act. ¹

Sentry petitioned this court for review, asserting that neither the facts nor the law supported a Tameny claim premised on plaintiff's second theory, and that the action was barred in any event by the workers' compensation law. After granting review, we requested additional briefing on the question whether a Tameny claim must be grounded in a violation of statute or constitutional provision. ²

For the reasons set forth below, we conclude that a termination in retaliation for testifying truthfully concerning a coworker's sexual harassment claim in the context of an administrative investigation is ACTIONABLE under Tameny, supra, 27 Cal.3d 167, 164 Cal.Rptr. 839, 610 P.2d 1330. We further conclude that neither the FEHA nor the Workers' Compensation Act preempts the claim. Accordingly, we shall affirm the decision of the Court of Appeal.

II. FACTS

Viewing the record most strongly in favor of the judgment, as we must (Agarwal v. Johnson (1979) 25 Cal.3d 932, 938, 160 Cal.Rptr. 141, 603 P.2d 58), the following pertinent chronology of facts appears: In September 1979, Sentry hired Gantt to serve as the sales manager of its Sacramento office. His mission was to develop the Sacramento sales force. How successfully he performed this task was the subject of conflicting evidence at trial. However, as explained below, the record amply supports the jury's specific finding that his demotion and constructive discharge were the product of his support for another employee's sexual harassment claim rather than the result of any legally valid business reason.

The specific circumstances which led to Gantt's estrangement from Sentry centered on Joyce Bruno, who was hired in January 1980 to be the liaison between trade associations and Sentry's Sacramento and Walnut Creek offices. In that capacity, Ms. Bruno reported to both Gantt and Gary Desser, the manager of the Walnut Creek office, as well as Brian Cullen, a technical supervisor at regional headquarters in Scottsdale, Arizona.

Shortly after she was hired, Ms. Bruno experienced sexual harassment at the hands of Desser. As the harassment continued, she complained to Gantt. He recommended she report it to Cullen in Scottsdale. Ultimately, Gantt himself contacted both Bonnie Caroline, who was responsible for receiving complaints of sexual discrimination, and Dave Berg, his immediate supervisor, about the problem. Despite these reports, the harassment continued. Accordingly, Gantt took it upon himself to speak a second time with both Berg and Ms. Caroline. Finally, in early 1981, Desser was demoted from sales manager to sales representative and replaced by Robert Warren. In March, Ms. Bruno was transferred to a sales representative position. A month later, however, she was fired.

Gantt stated that he was present at the April meeting in which Berg directed Warren to fire Bruno and ridiculed Gantt for supporting her. The following month, Berg himself resigned from Sentry following an investigation into claims that he had engaged in sexual harassment. Berg's replacement, Frank Singer, assumed the title "Director of Sales" and recruited John Tailby to assume Berg's old position supervising the various sales offices. According to one witness, Tailby said Singer told him that getting rid of Gantt was to be one of his first tasks. Tailby resisted, however, and in 1981 Gantt was ranked among Sentry's top district managers in premium growth.

Bruno, meanwhile, filed a complaint with the Department of Fair Employment and Housing (DFEH). She alleged harassment by Desser and failure by Sentry's higher management to act on her complaints. Caroline Fribance, Sentry's house counsel in charge of labor-related matters, undertook to investigate the matter. Gantt informed Fribance that he had reported Bruno's complaints to personnel in Scottsdale. However, Gantt gained the impression that he was being pressured by Fribance to retract his claim that he had informed Scottsdale of the complaints. Later, following the interview with Fribance, Tailby cautioned Gantt that Singer and others in the company did not care for Gantt. In a follow-up memorandum, Tailby cautioned Gantt that "it sometimes appears that you are involved in some kind of 'intrigue' and 'undercover' operation." In December 1982, Tailby rated Gantt's overall work performance for the year as "acceptable." Without directly informing Gantt, Singer changed the rating to "borderline acceptable/unacceptable."

Shortly thereafter, John Thompson, a DFEH investigator, contacted Fribance to arrange interviews with certain employees, including Gantt. Because of his growing unease about Fribance, Gantt arranged to meet secretly with Thompson before the scheduled interview. Gantt told him the facts of which he was aware, including his reporting of Bruno's complaints to Scottsdale, and Thompson assured him that he would be protected under the law from any retaliation for his statements. Thompson gained the impression that Gantt felt he was being pressured and was extremely fearful of retaliation because of his unfavorable testimony.

Gantt met with Fribance the day before his formal DFEH interview. She repeatedly reminded him that he was the only management employee supporting Ms. Bruno's claim that she had notified management about the harassment. Plaintiff felt that Fribance was unhappy with his testimony and that her unstated intent was to induce him to change his story. She also told him about another employee who had been found guilty of sexual harassment but retained by the company because he was a loyal employee. It was also during this meeting that Gantt discovered the change in his December 1982 evaluation. These events confirmed his fears that the company was pressuring him to withhold testimony or face retaliation.

The official DFEH interviews took place the next day. Fribance was present during Thompson's interview with Gantt. Following the interview, Fribance asked Thompson why he was not investigating sexual harassment charges against Gantt; she indicated that Gantt had harassed Bruno and was trying to deflect attention from himself. Thompson was surprised by Fribance's statements since he had never experienced a company attorney suggesting that charges be brought against one of the company's own employees. ³

Less than two months later, on March 3, 1983, Gantt attended an awards ceremony in Scottsdale to accept a life insurance sales award on behalf of his office. The following morning, Singer and Tailby informed him that he was being demoted to sales representative. Shortly thereafter, Gantt's new supervisor, Neil Whitman, warned him that he would be fired if he attempted to undermine Whitman's authority. Gantt was also informed that he would not be given a "book" of existing accounts to start his new job; according to Gantt, such a book was necessary to survive.

During the following month, Gantt was in the office only intermittently. He experienced a variety of illnesses and took vacation time and sick leave. In mid-April he was offered and accepted a position with another company. He left Sentry's payroll in early May. Two months later, he filed the...