King v. MARRIOTT INTER., INC.

• Decision Date: 27 January 2005
• Docket Number: No. 175,175
• Citation: 866 A.2d 895,160 Md. App. 689
• Parties: Karen Bauries KING v. MARRIOTT INTERNATIONAL, INCORPORATED.
• Court: Court of Special Appeals of Maryland

866 A.2d 895

160 Md. App. 689

Karen Bauries KING v. MARRIOTT INTERNATIONAL, INCORPORATED.

No. 175, September Term, 2004.

Court of Special Appeals of Maryland.

January 27, 2005.

Argued by Steven M. Salky (Karen B. Dietrich, Mary I. Peters, Zuckerman, Spaider, L.L.P., Robert B. Fitzpatrick, on the brief), Washington. D.C., for appellant.

Argued by Todd J. Horn (Venable, L.L.P., on the brief), Baltimore, MD, for appellee.

Panel: EYLER, JAMES R., ADKINS, BARBERA, JJ.

JAMES R. EYLER, J.

This appeal arises from a wrongful discharge action brought by Karen Bauries King, appellant, in the Circuit Court for Montgomery County, against her former employer, Marriott International, Incorporated, appellee.¹ Appellant contends that she was terminated from her position in appellee's employee benefits department because she voiced objections to her co-workers and supervisor about the proposed transfer of funds from an employee Medical Plan ("Medical Plan or Plan"), qualified under ERISA,² to a general corporate account. The circuit court entered summary judgment in favor of appellee on the grounds that (1) there is no viable wrongful discharge action under State law because termination of appellant's employment did not violate a clear mandate of public policy; and (2) appellant's State law claim is preempted by ERISA section 514(a). 29 U.S.C. § 1144(a). Appellant argues that these conclusions were erroneous.

We affirm the judgment of the circuit court on the ground that appellant failed to identify a sufficiently compelling public policy violated by the actions of appellee. In light of this conclusion, there is no State law claim to be preempted, and thus, no need to determine whether the doctrine of preemption applies.

FACTUAL BACKGROUND

For approximately ten years prior to her termination on March 22, 2002, appellant had been employed in various positions in appellee's employee benefits department. In July 1998, Karl I. Fredericks ("Mr. Fredericks") became Senior Vice President for Compensation and Benefits. Appellant, as Director of Benefit Operations, reported to him, as did Ms. Maureen Brookbank ("Ms. Brookbank"), Vice President of Benefits Planning & Retirement Plans, and Ms. Sandra Kingsley ("Ms. Kingley"), Controller. In late 1998 or early 1999, appellant learned that Mr. Fredericks and the corporate accounting department planned to transfer funds from an employee Medical Plan reserve account to a general corporate account. Appellant, Ms. Brookbank, and Ms. Kingsley objected to the proposed transfer. Their objections were communicated to Mr. Fredericks. Apparently, no funds were transferred at that time.

In the summer of 1999, Mr. Fredericks reorganized the employee benefits department. As part of that reorganization, Ms. Kingsley voluntarily terminated her employment with appellee. Additionally, on September 11, 1999, Mr. Fredericks promoted appellant to Vice President of Benefit Resources, which included responsibility for employee benefits accounting. During the reorganization, Mr. Fredericks also changed the duties and responsibilities of Ms. Brookbank.

In the fall of 1999, appellant learned that the proposal to transfer funds from the benefits Plan was again being discussed. From October to December, 1999, appellant voiced her objections, verbally and by e-mail, to Mr. Fredericks and to appellee's in-house counsel in charge of employee benefits and compensation issues, Mr. Edward Rosic ("Mr. Rosic"). Appellant believed that the proposed transfer constituted the "illegal" use of Plan assets for corporate purposes. Transfer of the funds, she asserted, would also result in fewer "premium holidays" or "benefits bonuses," which enabled Plan participants to not pay premiums for a certain period of time, during which the cost of their benefits would be paid with Plan assets.

On December 10, 1999, Mr. Fredericks presented appellant and Ms. Brookbank with memoranda indicating that their job performance was unsatisfactory.³ The memoranda referenced an inability by the addressees to work together and indicated that, absent immediate substantial change, adverse employment actions would be taken. Near the end of 1999, appellee transferred approximately $7.3 million from the Medical Plan reserve account, regarded by in-house counsel as non-Plan assets and "excess reserves," to a general corporate reserve account. Appellant did not have any prior knowledge of the transfer, did not approve the transfer, and did not participate in any way in the transfer of funds.

In early 2000, appellant heard that appellee proposed to utilize an additional sum of money from the Medical Plan reserve account to pay for consulting costs unrelated to the Plan. Again, appellant objected verbally and through e-mail to Mr. Fredericks.

On March 21, 2000, Mr. Fredericks terminated Ms. Brookbank's employment. On March 22, 2000, he terminated appellant's employment. Mr. Fredericks stated he terminated the employment of both persons because of their inability to get along with each other and with the staff.

PROCEDURAL HISTORY

On March 21, 2001, appellant filed a complaint in the Circuit Court for Montgomery County against appellee and Mr. Fredericks, collectively the "defendants," alleging wrongful discharge and defamation. Defendants removed the case to the United States District Court for the District of Maryland, asserting federal question jurisdiction. Appellant moved to remand the case. The federal district court denied the motion on the grounds that appellant's allegations stated a cause of action under ERISA, and thus, the state law claims were completely preempted by ERISA section 514. 29 U.S.C. § 1132(a).⁴ Appellant filed an amended complaint, which included a claim for wrongful discharge under State law, but also contained additional counts, including an alleged violation of ERISA section 510.⁵ 29 U.S.C. § 1140. Defendants filed a motion to dismiss the amended complaint. In denying defendants' motion to dismiss, the federal district court revisited the question of whether appellant's wrongful discharge claim was completely preempted by ERISA. The federal district deferred deciding the issue until after discovery.

Subsequent to discovery, defendants filed a motion for summary judgment. Defendants' motion was granted. With respect to the counts alleging wrongful discharge and a violation of ERISA, the court granted defendants' motion on the ground that there was no evidence to establish causation between appellants' objections to the transfer of funds and termination of her employment.

Appellant appealed to the United States Court of Appeals for the Fourth Circuit, contending that the federal district court erred by concluding that her wrongful discharge claim was completely preempted by ERISA section 514, 29 U.S.C. § 1144 and, thus, by denying her motion to remand. The Fourth Circuit agreed with appellant and vacated the federal district court's decision, holding (1) that ERISA does not provide a cause of action, assuming the truth of appellant's assertions, and as a consequence, (2) that appellant's State law wrongful discharge claim was not completely preempted. The Fourth Circuit expressly did not rule on whether the claim was subject to ordinary preemption under ERISA section 514. 29 U.S.C. § 1144.

The case was remanded to the Circuit Court for Montgomery County. On November 14, 2002, appellant filed an amended complaint, the one before us, in which she alleged only a State law wrongful discharge claim against appellee. The circuit court entered summary judgment in favor of appellee on the grounds that (1) the wrongful discharge claim was not viable under State law because no specific mandate of public policy was violated and (2) the wrongful discharge claim was preempted by ERISA section 514(a). 29 U.S.C. § 1144(a). Appellant noted a timely appeal to this Court.

STANDARD OF REVIEW

This case comes to us on a motion for summary judgment, and our review shall be de novo. Whether appellant has satisfied her burden of proving that her termination violated a compelling mandate of public policy, is a question of law. See Wholey v. Sears Roebuck, 370 Md. 38, 48, 803 A.2d 482 (2002) (citing Register of Wills for Balt. County v. Arrowsmith, 365 Md. 237, 249, 778 A.2d 364 (2001); Watson v. Peoples Security Life Ins. Co., 322 Md. 467, 478, 588 A.2d 760 (1991)). If appellant failed to state a claim upon which relief can be granted, then it was appropriate for the trial court to grant summary judgment in favor of appellee. As appellant was the non-moving party below, we shall assume the truth of appellant's factual assertions and view the evidence in the light most favorable to her. See Wholey, 370 Md. at 46,803 A.2d 482.

DISCUSSION

Wrongful Discharge Generally

An at will employee, such as appellant, has an employment contract of infinite duration which is terminable for any reason by either party. See Suburban Hosp. v. Dwiggins, 324 Md. 294, 303, 596 A.2d 1069 (1991); Adler v. American Standard Corp., 291 Md. 31, 35, 432 A.2d 464 (1981); Bagwell v. Peninsula Regional Medical Center, 106 Md.App. 470, 494-95, 665 A.2d 297 (1995), cert. denied, 341 Md. 172, 669 A.2d 1360 (1996) (citations omitted). As the Court of Appeals recently reaffirmed,

In the at-will employment context, we have held that a jury may not review any aspect of the employer's decision to terminate and that the employer may, absent a contravening public policy terminate an employer [sic] for any reason, even a reason that is arbitrary, capricious, or fundamentally unfair.

Towson University v. Conte, 384 Md. 68, 82, 862 A.2d 941 (2004). The tort of wrongful discharge is a narrow exception to this well-established principle. See Adler, 291 Md. at 35, 432 A.2d 464; see also Ewing v. Koppers Co. Inc., 312 Md. 45, 49, 537 A.2d 1173 (1988) (holding that the tort of wrongful discharge is also available to contractual employees).

In order to establish wrongful...