Miklosy v. Regents of Univ. Of California

• Decision Date: 31 July 2008
• Docket Number: No. S139133.,S139133.
• Citation: 80 Cal.Rptr.3d 690,188 P.3d 629
• Court: California Supreme Court
• Parties: Les G. MIKLOSY et al., Plaintiffs and Appellants, v. The REGENTS OF the UNIVERSITY OF CALIFORNIA et al., Defendants and Respondents.

188 P.3d 629

80 Cal.Rptr.3d 690

Les G. MIKLOSY et al., Plaintiffs and Appellants, v. The REGENTS OF the UNIVERSITY OF CALIFORNIA et al., Defendants and Respondents.

No. S139133.

Supreme Court of California.

July 31, 2008.

Gwilliam, Ivary, Chiosso, Cavalli & Brewer, J. Gary Gwilliam, Oakland; Law Offices of Jan C. Nielsen and Jan C. Nielsen for Plaintiffs and Appellants.

Loraine V. Johnson as Amicus Curiae on behalf of Plaintiffs and Appellants.

Kerr & Wagstaffe, Michael von Loewenfeldt, San Francisco, and Michael K. Ng for Project on Government Oversight as Amicus Curiae on behalf of Plaintiffs and Appellants.

Joel Golden, San Diego, for Dr. Larry M. Brand as Amicus Curiae on behalf of Plaintiffs and Appellants.

Ross, Dixon & Bell and Jon R. Williams for Whistlebusters.org as Amicus Curiae on behalf of Plaintiffs and Appellants.

Loulena Miles, Livermore, for Tri-Valley CAREs as Amicus Curiae on behalf of Plaintiffs and Appellants.

Beeson, Tayer & Bodine and Dale L. Brodsky, Oakland, for Society of Professionals, Scientists, and Engineers, Local 11 and University Professional and Technical Employees, CWA Local 9119, AFL-CIO as Amici Curiae on behalf of Plaintiffs and Appellants.

Reed Smith, Paul D. Fogel, Dennis Peter Maio, San Francisco; Melissa M. Allain, Janet G. Tulk, Gabriela B. Odell, Max A. Creamer, Livermore; Jeffrey A. Blair, Oakland; Hanson Bridgett Marcus Vlahos & Rudy, Patrick M. Glenn, San Francisco, Sandra K. Rappaport and Sarah D. Mott, San Francisco, for Defendants and Respondents.

KENNARD, J.

The California Whistleblower Protection Act (Gov.Code, § 8547 et seq.)¹ (hereafter the Whistleblower Act or the Act) prohibits retaliation against state employees who "report waste, fraud, abuse of authority, violation of law, or threat to public health" (§ 8547.1). The Act authorizes "an action for damages" to redress acts of retaliation. (§§ 8547.8, subd. (c), 8547.10, subd. (c), 8547.12, subd. (c).) But in the case of retaliation against a University of California employee, the Act provides that "any action for damages shall not be available . . . unless the injured party has first filed a complaint with the [designated] university officer . . ., and the university has failed to reach a decision regarding that complaint within the time limits established for that purpose by the regents." (§ 8547.10, subd. (c), italics added.) We conclude, as did the Court of Appeal, that this statutory language means what it says, precluding a damages action when, as here, the University of California has timely decided a retaliation complaint.

I

Because this case comes before us on appeal from a judgment sustaining a demurrer, we assume the truth of the facts alleged in the complaint and the reasonable inferences that may be drawn from those facts. (See, e.g., Fox v. Ethicon Endo-Surgery, Inc. (2005) 35 Cal.4th 797, 810, 27 Cal. Rptr.3d 661, 110 P.3d 914; Coleman v. Gulf Insurance Group (1986) 41 Cal.3d 782, 789, fn. 3, 226 Cal.Rptr. 90, 718 P.2d 77; Blank v. Kirwan (1985) 39 Cal.3d 311, 318, 216 Cal. Rptr. 718, 703 P.2d 58.)

Plaintiffs Leo Miklosy and Luciana Messina are computer scientists who, in February 2003, were employed by the Regents of the University of California (hereafter the University of California or the University), filling positions at the Lawrence Livermore National Laboratory (the Laboratory). Plaintiffs worked in the National Ignition Facility on a project designed to determine the safety and reliability of the nation's nuclear weapons stockpile. One method of evaluating the safety and reliability of these weapons involved shooting laser beams at "nuclear material" placed in a "Target Chamber."

As their work proceeded, plaintiffs "identified problems with the . . . project, including, inter alia, potential collisions by large million dollar robotic `positioners' within the [Target Chamber] . . ., the delivery of unusable and untested control software, a lack of defined engineering and operational processes . . ., and inadequate . . . control operator training. . . ." Plaintiffs repeatedly expressed their concerns to management, both orally and in writing, enumerating specific mechanical problems with the positioners and the robotic controls.

On Friday, February 28, 2003, defendants Kim Minuzzo, Larry Lagin, and Jerry Krammen, who were supervisory employees of the Laboratory, fired Miklosy. As he was leaving the premises, Miklosy heard Minuzzo tell Krammen: "Messina is next." Believing her performance was comparable to that of Miklosy, Messina submitted a letter of resignation. Lagin and Minuzzo asked Messina to reconsider her resignation over the weekend which she agreed to do. When Messina returned to her office after this meeting, she found her computer disconnected.

On Monday, March 3, 2003, Messina inquired about transferring to a different position at the Laboratory, but Minuzzo telephoned her the next day and directed her to return to the National Ignition Facility. After that conversation had ended, but before the telephone call was disconnected, Messina overheard Minuzzo tell another employee that he intended to fire Messina. Messina resigned as of March 7, 2003.

On August 16, 2003, plaintiffs filed complaints with the University under section 8457.10, subdivision (a), of the Whistleblower Act. The Laboratory's Personnel Policies and Procedures Manual requires the director of the Laboratory to appoint a "Retaliation Complaint Officer" (RCO) to investigate a complaint of whistleblower retaliation. The RCO must prepare findings within 90 days; once the findings are submitted, the director of the Laboratory must reach a decision on the complaint within 15 days. The director's decision may include "appropriate relief for the complainant" and may be appealed to the president of the University. This procedure is generally comparable to the procedure the State Personnel Board follows when evaluating similar complaints by state agency employees. (See Cal.Code Regs., tit. 2, § 56.3, subd. (a) [appointment of an investigator]; id. at §§ 56.3, subd. (b), 56.5, subd. (a) [issuance of findings based on the investigator's report]; id. at § 56.5, subd. (d) [appeal to the five-member State Personnel Board]; id. at §§ 56.2, subd. (c), 56.5, subd. (d), 56.8 [no right to a formal hearing at any point in the process, though one may be granted at the board's discretion].)

In regard to plaintiffs' complaints, John S. Hunt, a Laboratory employee, acted as the RCO. The Laboratory has a staff that exceeds 8,000, and there is no indication in the complaint that Hunt was in any way involved in the direct management of the National Ignition Facility or had any personal connection with the dispute. Hunt interviewed 23 witnesses and submitted his findings to Robert Perko, the Staff Relations Officer, on November 4, 2003. Hunt found that Laboratory management had not reacted adversely to plaintiffs' reports of problems at the National Ignition Facility, instead treating those reports as a normal part of project development. Hunt found no support for the assertion that management had retaliated against either Miklosy or Messina. Hunt determined instead that the Laboratory had fired Miklosy for unsatisfactory work performance and that the Laboratory had never intended to fire Messina and actually had tried to convince her to stay. The Laboratory director adopted Hunt's findings and conclusions on November 17, 2003, and plaintiffs concede that the Laboratory reached its decision within the time limits specified in its internal policies. Plaintiffs did not appeal the director's decision to the president of the University, and therefore the decision became the University's final resolution of the matter.

On February 10, 2004, plaintiffs filed a damages action in superior court against the University and three supervisory employees — Minuzzo, Lagin, and Krammen. The complaint alleged four causes of action: (1) unlawful retaliation in violation of the Whistleblower Act (both plaintiffs); (2) wrongful termination in violation of public policy (Miklosy); (3) wrongful constructive termination in violation of public policy (Messina); and (4) intentional infliction of emotional distress (both plaintiffs). The complaint sought compensatory damages, punitive damages, and attorney fees.

The trial court sustained defendants' demurrer with leave to amend, and when plaintiffs filed an amended complaint, defendants again demurred. The trial court then sustained defendants' demurrer without leave to amend, and dismissed plaintiffs' action. The Court of Appeal affirmed, holding that plaintiffs had no viable claim under the Whistleblower Act because the University timely resolved their complaints, and further holding that plaintiffs' common law claims were statutorily barred. We granted plaintiffs' petition for review.

II

In 1993, the Legislature enacted the Whistleblower Act, codifying it as sections 8547 through 8547.11. (Stats.1993, ch. 12, § 8, pp. 96-101.) At that time, the Act was entitled the "Reporting of Improper Governmental Activities Act," and its stated purpose was to encourage the disclosure of "improper governmental activities," which the Act generally defined as activities that were unlawful, economically wasteful, or involved gross misconduct or incompetence. (Id. at pp. 96-97.) The Act was not wholly new; rather, it built on existing provisions of the Government Code, in some cases renumbering those provisions without changing their substantive content. In 1999, the Legislature extended the Act to cover disclosures of health and safety problems (Stats.1999, ch. 673, §§ 4, 6, 7), giving the Act its present name (id., § 1) and declaring, as its purpose, "that state employees should be free to report waste, fraud, abuse of authority, violation of law, or threat to public health without fear of retribution" (id., § 3).

Since its inception, the Act has dealt with employees of the state and the...