Gassman v. Evangelical Lutheran Good Samaritan Soc., Inc.

• Decision Date: 26 July 1996
• Docket Number: No. 74272,74272
• Parties: , 12 IER Cases 360 Peggy GASSMAN, Appellant, v. The EVANGELICAL LUTHERAN GOOD SAMARITAN SOCIETY, INC., Appellee.
• Court: Kansas Court of Appeals

Page 224

921 P.2d 224

22 Kan.App.2d 632, 12 IER Cases 360

Peggy GASSMAN, Appellant, v. The EVANGELICAL LUTHERAN GOOD SAMARITAN SOCIETY, INC., Appellee.

No. 74272.

Court of Appeals of Kansas.

July 26, 1996.

Review Granted Sept. 25, 1996.

Syllabus by the Court

1. The applicability of the "after-acquired evidence" doctrine to wrongful discharge cases in Kansas is discussed.

2. Unlike the policies underlying anti-discrimination statutes, in ordinary breach of employment contract actions, there is no overriding governmental interest in preventing breaches which would limit the application of the after-acquired evidence doctrine.

PrestonA. Pratt and Steven W. Hirsch, of Hirsch & Pratt, L.L.P., Oberlin, for appellant.

Christopher R. Hedican and Christopher E. Hoyme, of Berens & Tate, P.C., Omaha, Nebraska, for appellee.

Before GERNON, P.J., PIERRON, J., and DAVID R. PLATT, District Judge, Assigned.

PIERRON, Judge:

This is a wrongful discharge case based on the employment termination of Peggy Gassmann. Gassmann appeals the district court's grant of summary judgment in favor of The Evangelical Lutheran Good Samaritan Society, Inc. (Good Samaritan). Specifically, Gassmann argues the district court erred in applying the after-acquired evidence doctrine and that such evidence, in any event, did not constitute a violation of company policy for which she could have been terminated.

The facts in this case are for the most part undisputed. Good Samaritan is a corporation which owns and operates nursing homes in many states throughout the Midwest, one of which is the Decatur County Good Samaritan Center in Oberlin. Gassmann worked at Good Samaritan from September 16, 1985, to December 10, 1993, as a certified nurse's aide. She was terminated for inconsiderate treatment of residents. On June 27, 1994, Gassmann filed a wrongful discharge lawsuit based upon Good Samaritan's violation of an implied employment contract and in violation of public policy. She sought an award for back pay and reinstatement.

At her September 17, 1994, deposition, Gassmann admitted that while she was still employed at Good Samaritan, she entered the office of the acting director of nursing without authorization and took a videotape of a company in-service meeting. She copied the videotape and then returned it to the office the next morning. In her deposition testimony, Gassmann agreed that the purpose for taking the tape was to serve as evidence in an effort to get rid of the acting facility director.

On December 5, 1994, Good Samaritan filed a motion for summary judgment. The basis for the motion was neither the implied contract nor the facts surrounding Gassmann's termination, but instead was the evidence acquired during her deposition concerning the videotape. Good Samaritan requested that the district court adopt the after-acquired evidence doctrine, i.e. evidence discovered after an employee's termination can be used to justify the discharge, if the evidence would have also been sufficient to terminate the employee, and grant its motion.

Good Samaritan submitted an affidavit from its administrator indicating that all employees received an employee handbook which states that any employee will be terminated if found to have engaged in "theft from coworker(s), resident(s), and/or the facility." Gassmann acknowledged receipt of copies of all Good Samaritan's employee handbooks. The administrator stated that if Gassmann had still been employed when he learned of the "theft" of the videotape, he would have immediately terminated her.

In her affidavit, Gassmann explained that all employees of Good Samaritan were required to either attend all in-service meetings or, if unable to attend, watch the videotape of the meeting. The facility director became upset at a particular in-service meeting, and Gassmann stated she wanted to watch the videotape of that meeting because she had missed the meeting. Gassmann also stated that prior to her termination, there had been much dissension between the employees and management of Good Samaritan. However, Gassmann contends she had no intent to use the videotape in an effort to get the acting director fired. Contrary to her deposition, she stated in her affidavit, "I made the copy in order to preserve the tape because I was afraid the tape, which showed the director acting inappropriately, would 'get lost'. I did not make the copy in a mutinous attempt to get [the director] fired."

Gassmann also submitted the affidavit of Lila Keenan, a former employee of Good Samaritan. Keenan confirmed Gassmann's statements that all Good Samaritan employees were required to watch the videotape of any missed in-service meetings. Keenan stated the only rule regarding taking videotapes was that they were to be returned quickly so others would be able to watch them. Keenan maintained she had taken a videotape home before to watch a missed in-service meeting and then returned it. Keenan did not believe this violated a company policy.

The district court specifically adopted the after-acquired evidence doctrine and granted summary judgment in favor of Good Samaritan. The district court denied Gassmann's motion for reconsideration.

The issue of the applicability of Gassmann's taking the videotape, evidence which became apparent to Good Samaritan only in the course of discovery during this litigation, is not a simple one. Analysis of this issue necessitates an examination of the admissibility and effect of "after-acquired evidence."

The after-acquired evidence doctrine in its purest form allows an employer to be relieved of liability in a wrongful discharge lawsuit where it is discovered, normally during litigation, that the employee was guilty of pre-discharge misconduct sufficient for termination that the employer was unaware of and was not relying upon for discharge. See Summers v. State Farm Mut. Auto. Ins. Co., 864 F.2d 700 (10th Cir.1988); Yoo, The After-Acquired Evidence Doctrine, 25 Colum. Hum. Rts. L. Rev. 219, 228 (Fall 1993) (the Summers rule). The after-acquired evidence doctrine has its foundation in the logic that an employee cannot complain about being wrongfully discharged because the individual is no worse off than he or she would have been had the truth of his or her misconduct been presented at the outset. See Annot., After-Acquired Evidence of Employee's Misconduct as Barring or Limiting Recovery in Action For Wrongful Discharge, 34 A.L.R.5th 699, 707.

The Kansas appellate courts have yet to rule on the issue of after-acquired evidence. Our analysis begins with the United States Supreme Court's recent decision in McKennon v. Nashville Banner Pub. Co., 513 U.S 352, 115 S.Ct. 879, 130 L.Ed.2d 852 (1995). In McKennon, the Court granted certiorari to resolve a split among the Circuit Courts of Appeals regarding the question of whether all relief must be denied when an employee has been discharged in violation of the Age Discrimination in Employment Act (ADEA), 29 U.S.C. § 621 et seq. (1994) and the employer later discovers some wrongful conduct that would have led to discharge had it been discovered earlier. 513 U.S. at ----, 115 S.Ct. at 883.

The court in Russell v. Microdyne Corp., 65 F.3d 1229, 1238 (4th Cir.1995), explained the split in this manner:

"Some circuits held that an after-acquired motive for an otherwise discriminatory action provided a complete defense, precluding a plaintiff from establishing liability or obtaining relief for the employer's conduct in violation of the law. See, e.g. Summers, 864 F.2d at 708. Others held that such after-acquired evidence of employee wrongdoing should only concern the remedies available to the employee once liability was established, and that it should not be admissible unless the employer demonstrated that it would have discovered the evidence in the absence of the discrimination litigation, because, otherwise, the employer would benefit from its discriminatory conduct. E.g., Wallace, 968 F.2d at 1181-84."

In McKennon, the plaintiff, a 62-year-old employee of Nashville Branner Publishing Company for 30 years, was discharged in what Branner termed a "work force reduction plan necessitated by cost considerations." 513 U.S. at ----, 115 S.Ct. at 882. McKennon filed suit alleging that her discharge violated the ADEA. In a deposition prior to trial, McKennon admitted to copying several confidential documents bearing upon the company's financial condition. She had access to these documents as secretary to Branner's comptroller. Her motivation for copying the documents was "insurance" and "protection" in case she was fired because of her age. Shortly after this deposition, Branner sent McKennon a letter claiming that the removal and copying of the records was in violation of her job responsibilities and again advised her that she was terminated.

Branner filed for summary judgment based on the evidence discovered during McKennon's deposition. Branner conceded its age discrimination against McKennon. The district court granted Branner's motion, holding that McKennon's misconduct was grounds for her termination, and that neither back pay nor any other remedy was available to her under the ADEA. The United States Court of Appeals for the Sixth Circuit affirmed on the same rationale. The United States Supreme Court disagreed.

In McKennon, the Supreme Court rejected the line of discrimination cases holding that after-acquired evidence of misconduct acted as a complete bar to recovery in an ADEA action, concluding that it only affects the amount of damages an employee may recover. 513 U.S. at ----, 115 S.Ct. at 886. See also Manard v. Fort Howard Corp., 47 F.3d 1067 (10th Cir.1995) (McKennon "largely rejected" the line of cases holding that after-acquired evidence of employee misconduct barred recovery in discrimination cases). The Court determined that "after-acquired evidence" of misconduct during employment is relevant in a discrimination case:

"In...