Grothe v. Ramsey Action Programs, Inc., No. A05-1503 (Minn. App. 6/6/2006)
| Decision Date | 06 June 2006 |
| Docket Number | No. A05-1503.,A05-1503. |
| Parties | Kevin D. Grothe, Appellant, v. Ramsey Action Programs, Inc., Respondent. |
| Court | Court of Appeals of Minnesota |
Appeal from the District Court, Ramsey County, File No. C5-04-7602.
Sonja Dunnwald Peterson, Dunnwald & Peterson, P.A., (for appellant).
Teresa M. Thompson, Anh Le Kremer, Parsinen Kaplan Rosberg & Gotlieb P.A., (for respondent).
Considered and decided by Lansing, Presiding Judge; Randall, Judge; and Willis, Judge.
UNPUBLISHED OPINION
Appellant challenges the district court's summary judgment on his whistleblower and defamation claims, alleging that (1) the results of an arbitration reinstating him with back pay did not preclude his whistleblower claim; (2) he sufficiently presented genuine issues for trial under the Minnesota Whistleblower Act; and (3) his complaint sufficiently alleged defamatory statements, or in the alternative, the district court abused its discretion by failing to allow amendment of the complaint.
We conclude that appellant's whistleblower claim was not precluded by the results of his union arbitration proceeding and that he presented sufficient evidence to withstand summary judgment on that claim. We reverse summary judgment on this issue and remand for trial.
We affirm the district court's summary judgment and dismissal of appellant's defamation claim.
Appellant Kevin Grothe began work in 1990 as an energy conservation specialist with respondent Ramsey Action Programs, Inc. (RAP), a private, non-profit agency. RAP's energy conservation department provides energy assessments, insulation and heating system repairs, and energy education to low-income households in Ramsey and Washington counties. RAP is a subgrantee of the Minnesota Department of Commerce (DOC) weatherization assistance program, which received federal funds from the United State Department of Energy (DOE) weatherization assistance program and other government funding sources. Appellant's duties included performing energy audits and inspecting program homes. In 1994 appellant was promoted to a lead energy conservation specialist position, with some supervisory duties. His position remained governed by the union collective bargaining agreement.
In November 2000, RAP hired, as appellant's supervisor, a new employee as energy program manager. Appellant observed problems with that person's management, including that he allowed grant-acquired property to be disposed of for greatly less than fair market value and that he failed to communicate properly with staff. In January 2002, appellant and ten other employees signed a petition calling for department "accountability and management improvements," which they forwarded to the DOE. Specifically, the petition alleged the illegal disposition of grant-acquired property with a total value of $3,000-$5,000 at a price of about $25; management "in disarray"; gender and race discrimination; carpenter review issues; and inequity in staff training opportunities. The DOE, in turn forwarded the petition to the DOC, which informed RAP that the improper disposition of items purchased with grant funds could violate federal regulations.
In March 2002, RAP placed its executive director on administrative leave and assigned two RAP employees as co-acting executive directors. The next month, RAP hired an independent consultant to investigate the petition allegations. The consultant interviewed the signing employees, including appellant, and RAP management and administrative staff. Appellant informed the consultant that he feared retaliation for his involvement in the petition.
The consultant issued his report in May, indicating that he was unable to prove allegations of illegal disposition of grant-acquired property, but did express significant leadership and management concerns. Appellant, believing that management had not sufficiently addressed the petition issues, wrote a response to the consultant's report on behalf of the petitioners. That response was submitted first to RAP's board chair and then, in July, to the DOE. The response reiterated the petition concerns, including illegal disposal of property, and included further allegations that RAP management had retaliated against petition signers by rifling personal office desks and deleting e-mail and voice-mail messages.
The DOC conducted an audit of RAP, including file reviews, home inspections, and employee and management interviews. The DOC investigator accompanied staff on home visits and checked file documentation, which revealed that official records differed from physical home inspections. After the DOC visits, the energy program manager examined several of appellant's weatherization audit reports with other staff members and determined that appellant had falsified recordkeeping information. The human resources director also provided documentation that appellant had claimed mileage for final home inspections when the homes had not in fact been inspected. On August 5, acting on behalf of RAP, the energy program manager terminated appellant's employment with the stated reason of misconduct for falsifying documents.
The DOC report, issued after appellant's termination, concurred with the consultant's conclusion that, although he was unable to prove allegations on the illegality of the disposition of grant-acquired property, there were numerous management problems. RAP terminated the energy program manager a few months later. Appellant applied for the vacant position but did not receive the job.
Appellant grieved his termination under his union's collective bargaining agreement. The arbitrator found that the certificates of completion appellant was alleged to have falsified contained ambiguous language as to what was being certified as completed and that appellant had a right to claim inspection mileage when he drove to a home site but was unable to gain entrance. The arbitrator concluded that RAP had failed to establish just cause for appellant's termination and ordered his reinstatement with back pay and benefits. In November 2003, after a reorganization had eliminated appellant's previous position, RAP reinstated him to an energy conservation specialist II position, with the same salary range and step as his previous position, but no supervisory duties.
Appellant filed a complaint alleging violation of the Minnesota Whistleblower Act, Minn. Stat. § 181.932 (2002), and defamation. The district court granted RAP's motion for summary judgment on both claims. This appeal followed.
On appeal from summary judgment, this court applies a de novo standard of review to determine whether any genuine issues of material fact exist and whether the district court erred in applying the law. STAR Ctrs., Inc. v. Faegre & Benson, L.L.P., 644 N.W.2d 72, 76 (Minn. 2002). This court views the evidence in the light most favorable to the party against whom judgment was granted. Id. at 76-77.
Minnesota's whistleblower law states that "[a]n employer shall not discharge, discipline, threaten otherwise discriminate against, or penalize an employee . . . because . . . the employee, . . . in good faith, reports [to the employer] a violation or suspected violation of any federal or state law or rule adopted pursuant to law . . . ." Minn. Stat. §181.932, subd. 1 (2004). This court considers appellant's claim for wrongful termination under the McDonnell Douglas burden-shifting analysis. Hubbard v. United Press Int'l, Inc., 330 N.W.2d 428, 444 (Minn. 1983). Under that analysis, if the plaintiff is able to establish a prima facie case, the burden shifts to the employer to show a legitimate, non-retaliatory reason for the discharge. Cokley v. City of Otsego, 623 N.W.2d 625, 630 (Minn. App. 2001), citing McDonnell Douglas Corp v. Green, 411 U.S. 792, 802, 93 S. Ct. 1817, 1824 (1973), review denied . The burden then shifts back to the employee to demonstrate that the employer's justification is pretexual. Id. The burden remains with the employee throughout the proceeding to prove by a preponderance of the evidence that the basis for the employer's action was impermissible. Id.
A prima facie case of retaliatory discharge consists of "(1) statutorily-protected conduct by the employee; (2) adverse employment action by the employer; and (3) a causal connection between the two." Hubbard, 330 N.W.2d at 444. The district court granted summary judgment to the employer on the whistleblower claim on the basis that any adverse employment action "was reversed" because appellant was "totally reinstated" with back pay and benefitsby the arbitration action; that no other adverse employment action occurred when he was not hired for the energy program manager position because he was not an employee when that hire was made; and that the seven-month period between the submission of the January petition and his termination, as a matter of law, was too lengthy to demonstrate a causal connection between his termination and the submission of the earlier petition.
The whistleblower act, by its plain language, protects good faith reports of violations or suspected violations of a state or federal law. Anderson-Johanningmeier v. Mid-Minnesota Women's Ctr. Inc., 637 N.W.2d 270, 274 (Minn. 2002). To satisfy the good faith requirement, an employee must show that "the report [was] made for the purpose of blowing the whistle, i.e., to expose an illegality." Obst v. Microtron, Inc., 614 N.W.2d 196, 202 (Minn. 2000); Gee v. Minnesota State Colleges and Universities, 700 N.W.2d 548, 555 (Minn. App. 2005). An employee need not identify the specific law that he believes violated "so long as there is a federal or state law or rule adopted pursuant to law that is implicated by the employee's complaint . . . and the employee alleges facts that, if proven,...
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