Nollner v. Southern Baptist Convention, Inc., Case No. 3:12-cv-00040

CourtUnited States District Courts. 6th Circuit. United States District Court of Middle District of Tennessee
Writing for the CourtALETA A. TRAUGER
Docket NumberCase No. 3:12-cv-00040
Decision Date03 April 2012


Case No. 3:12-cv-00040


Dated: April 3, 2012

(Consolidated with Case No. 3:12-cv-00043)

Judge Aleta A. Trauger


Pending before the court are several related motions. Defendants Global Enterprise Services, LLC ("GES") and the International Mission Board of the Southern Baptist Convention, Inc. ("IMB") (collectively, "IMB Defendants") have filed a Motion to Dismiss (Docket No. 6), to which the plaintiffs filed a Response (Docket No. 23), and the IMB Defendants filed a Reply (Docket No. 31). Defendant Southern Baptist Convention, Inc. ("SBC") has filed a Motion to Dismiss (Docket No. 10), to which the plaintiffs filed a Response (Docket No. 22), and SBC filed a Reply (Docket No. 32). In support of the plaintiffs' Responses to both Motions to Dismiss, the plaintiffs filed the Affidavit of Ron Nollner (Docket No. 25) and the Affidavit of Samuel D. Payne, Esq. (Docket No. 26). SBC and the IMB Defendants have filed Motions to Strike those affidavits (Docket Nos. 28 (SBC) and 29 (IMB Defendants)), to which the plaintiffs have not responded.

For the reasons stated herein, the Nollners' claim under the Dodd-Frank Act will be dismissed with prejudice, the court will decline to exercise supplemental jurisdiction over the

Page 2

remaining state law claims, and the case will be remanded to state court. The Motions to Dismiss will be denied as moot except as to the Dodd-Frank Act claim, and the Motions to Strike will be denied as moot.


I. Procedural History

On October 20, 2011, the plaintiffs, Ron Nollner and his wife, Beverly Nollner, filed this lawsuit in Tennessee state court. (Docket No. 1, Ex. A ("Complaint").) The Complaint alleged that the Nollners are Tennessee residents, SBC is a Georgia corporation with a principal place of business in Tennessee (i.e., not diverse from the plaintiffs), IMB is a Virginia corporation, and GES is a Virginia Limited Liability Company. The original Complaint asserted claims under Tennessee law for breach of contract, promissory estoppel, and retaliatory discharge under Tennessee common law and the Tennessee Public Protection Act ("TPPA"), § 50-1-304 et seq.

On December 9, 2011, the plaintiffs filed a First Amended Complaint (Docket No. 1, Ex. B), which added a claim for retaliatory discharge under the Dodd-Frank Wall Street Reform and Consumer Protection Act ("Dodd-Frank Act" or "DFA"), 15 U.S.C. § 78u-6 - i.e., a claim arising under federal law. On January 6, 2012, the IMB Defendants removed the action, on the grounds that this court has original federal question jurisdiction over the DFA claim and supplemental jurisdiction over the state law claims. (Docket No. 1.)1

Page 3

II. Complaint Allegations2

Mr. Nollner is a Tennessee resident with decades of experience in the construction industry and is a devoted member of the Southern Baptist community. At some point in or before April 2008, IMB, which is a wholly owned subsidiary of SBC, posted a job vacancy to perform missionary-related work on the church's behalf in New Delhi, India. (Docket No. 1, Ex. B ("Job Vacancy Announcement").) The Job Vacancy Announcement solicited candidates to manage construction of a new office building in New Delhi, including working with local companies, assisting in obtaining necessary permits, and ensuring that engineering standards were followed. It also indicated that the term of employment would be a minimum of 24 months and a maximum of 36 months. Furthermore, it included a "Spouse Assignment Description," which stated that the candidate's spouse would "be a vital part of the team," reflecting an intent to hire both the construction manager and his or her spouse.

IMB encouraged the Nollners to take the positions identified in the Job Vacancy Announcement. In October 2008, at IMB's urging, the Nollners accepted the positions,3 which they understood would last at least one 36-month term. In anticipation of moving to New Delhi for this extended period, the Nollners sold essentially all of their assets, Mr. Nollner gave up his active construction career, and Beverly Nollner gave up her job of 17 years.

When the Nollners arrived in New Delhi, the situation was not what had been promised.

Page 4

The planning and permitting phase of the project had already been completed and the defendants4 would not allow Mr. Nollner to meet with the architect or contractor for the job at issue until April 2009 - well into the project. Over the next several months, Mr. Nollner also became aware of a host of troubling information, including the following:

• Before Mr. Nollner arrived, the defendants hired a contractor and an architectural firm (both of which were controlled by the same individual) without any competitive bidding process and without entering into a written contract.
• IMB was operating the project through a number of "dummy" companies, perhaps as part of a scheme to conceal the nature of its activities;
• The workmanship and materials utilized in the building were below standards and unsafe;
• The defendants were maintaining suspiciously incomplete records regarding job-related invoices and payments;
• IMB refused to furnish Mr. Nollner with building specifications for the

Page 5

project until July 2009;
• The contractor and architect attempted to bribe Mr. Nollner several times after he complained about their performance;
• The contractor and architect were paying bribes to local Indian officials with money furnished by the defendants for that purpose;
• The defendants had received an improper or illegal permit (referred to as a "sanction" in India) from the Indian government. The sanction was issued pursuant to affirmative misrepresentations by the defendants to the Indian government (including falsified design specifications), which represented that the building would be utilized for "residential" rather than "commercial purposes," perhaps to avoid compliance requirements for commercial structures. Debbie Harrison had signed the illegal permit on behalf of IMB.

Mr. Nollner reported these practices and potential illegalities to his supervisors multiple times, but they ignored his entreaties. When Mr. Nollner reported his grave concerns about potential bribery to the defendants' employees, they "seemed unbothered, if not complicit." (First Am. Compl. ¶ 46.)

On or about October 21, 2010, two of Mr. Nollner's superiors asked him to resign his position in India.5 After Mr. Nollner refused to resign, the defendants terminated his employment on or about October 23, 2010, claiming that his position was no longer necessary. The Nollners scrambled to make arrangements to relocate to the United States. They returned to Nashville, where they currently reside.

Based on these allegations, the Nollners assert that the defendants are liable under Tennessee state law for breach of contract, promissory estoppel, retaliatory discharge under the common law and the TPPA , and under federal law pursuant to the DFA. With respect to the

Page 6

retaliatory discharge claims, the First Amended Complaint states that the Nollners were terminated for reporting about "unsafe building practices and permits" and for reporting and/or refusing to participate in "bribes and other illegal payments." (First Am. Compl. ¶¶ 54-55.) As to the DFA, the Nollners allege that the DFA's whistleblower anti-retaliation provisions (15 U.S.C. § 78u-6(h)(1)(A)(iii)) protected Mr. Nollner against retaliation for reporting the defendants' violations of the Foreign Corrupt Practices Act ("FCPA").

III. Motions to Dismiss and Related Motions to Strike

In reliance on Tennessee state law, SBC contends that the Nollners' claims against it must be summarily dismissed pursuant to Rule 12(b)(6), because SBC did not employ the Nollners and because the allegations do not establish that SBC and the IMB Defendants are "alter egos." The IMB Defendants have also moved to dismiss, on two separate grounds. First, they argue that all the claims must be dismissed under Rule 12(b)(6) because: (1) the state law claims are governed by Virginia law - not Tennessee law - under which all of the claims fail as a matter of law; and (2) the DFA whistleblower anti-retaliation provisions are inapplicable to Mr. Nollner's disclosures of alleged FCPA violations by the defendants. Second, the IMB Defendants argue that the case should be dismissed under Fed. R. Civ. P. 12(b)(3) because venue is not proper in the Middle District of Tennessee.

Among the materials attached to their Complaint, the Nollners attached the April 2008 Job Vacancy Announcement for the New Delhi position, on which they rely as defining certain terms and conditions of their employment relationship. In response, the IMB Defendants filed the Declaration of Doug Floyd (Docket No. 8) and the Declaration of Randy Pegues (Docket No. 9), which allege facts and attach supporting records relating chiefly to: (1) the nature of the

Page 7


To continue reading

Request your trial

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT