PHD v. Bechtel Nat'l, Inc.

• Decision Date: 01 July 2014
• Docket Number: Nos. 31451–1–III, 31789–7–III.,s. 31451–1–III, 31789–7–III.
• Citation: 327 P.3d 1309,182 Wash.App. 241
• Court: Washington Court of Appeals
• Parties: Walter L. TAMOSAITIS PHD, an individual, and Sandra B. Tamosaitis, representing the marital community, Appellants, v. BECHTEL NATIONAL, INC., a Nevada Corporation, URS Corporation, a Nevada Corporation, Frank Russo, an individual, Gregory Ashley, an individual, William Gay, an individual, Dennis Hayes, an individual, and Cami Krumm, an individual, Respondents.

182 Wash.App. 241

327 P.3d 1309

Walter L. TAMOSAITIS PHD, an individual, and Sandra B. Tamosaitis, representing the marital community, Appellants,

v.BECHTEL NATIONAL, INC., a Nevada Corporation, URS Corporation, a Nevada Corporation, Frank Russo, an individual, Gregory Ashley, an individual, William Gay, an individual, Dennis Hayes, an individual, and Cami Krumm, an individual, Respondents.

Nos. 31451–1–III, 31789–7–III.

Court of Appeals of Washington, Division 3.

July 1, 2014.

John Patrick Sheridan, MacDonald Hoague and Bayless, Seattle, WA, for Appellants.

Kevin Carl Baumgardner, Corr Cronin Michelson Baumgardner & Pree, Howard Mark Goodfriend, Smith Goodfriend PS, Joshua J. Preece, Corr Cronin Michelson Baumgardner & Pree, Seattle, WA, for Respondents.

KORSMO, J.

¶ 1 After a series of escalating professional disagreements and souring interpersonal relationships, Dr. Walter Tamosaitis was reassigned by his employer at the request of the project's general manager, Bechtel National, Inc. (Bechtel), but did not lose any pay. Dr. Tamosaitis then brought state, federal, and administrative suits against numerous defendants, including this state court action against Bechtel and its employees Frank Russo and Gregory Ashley, for intentional interference with a business relationship. Because Dr. Tamosaitis failed to carry his burden of production with regard to proof of damages, we affirm.¹

Facts

¶ 2 Dr. Tamosaitis spent more than 40 years working in the chemical and nuclear industries, working for URS Corporation , its predecessors, and its subsidiaries during most of that time. Most recently, Dr. Tamosaitis worked for URS Energy and Construction, Inc. In 2003, Dr. Tamosaitis moved to Washington State to work for URS on its contract at the Hanford Waste Treatment Plant (WTP). From 2003 to 2010, he helped manage design and construction at the Hanford Nuclear Reservation.

¶ 3 The design and construction of the WTP is a federal project under the purview of the United State Department of Energy (DOE). Bechtel is DOE's prime contractor on this project. URS in turn is a subcontractor for Bechtel.

¶ 4 Prior to the reassignment at issue, Dr. Tamosaitis served as manager of the project's Research and Technology Group. Throughout 2009 and 2010, this group was responsible for closing “M3.” M3 was the last of a group of major issues identified in 2005–06 by a DOE review team (which included Dr. Tamosaitis) that needed to be solved before other parts of the WTP's design and construction could proceed.

¶ 5 In early 2010, Bechtel made a number of management changes on its end of the project. Bechtel made Frank Russo the director of the WTP and moved Gregory Ashley, another Bechtel employee, under Mr. Russo's direct supervision. Mr. Ashley had previously been under the supervision of assistant director Bill Gay, a URS employee.

¶ 6 For a number of reasons, Dr. Tamosaitis could not establish a good professional relationship with Mr. Russo and Mr. Ashley. One large impediment was the increasing pressure on Bechtel to close the M3 issue. In April of 2010, DOE decided to condition an approximately $5,000,000 incentive fee on Bechtel's ability to close M3 on June 30, 2010. Bechtel also hoped that timely closure of all of the review team issues would persuade Congress to allocate an additional $50,000,000 to the WTP.

¶ 7 It initially appeared that M3 would close on schedule. However, an unexpected problem arose in the spring of 2010 when outside engineers found a flaw in the testing parameters that were used to validate the design functionality of the pulse jet mixers that were to be installed at the WTP. Dr. Tamosaitis and a number of other engineering professionals concurred in this finding and called for additional testing.

¶ 8 Additional testing, however, would have prevented the timely closure of the M3 issue and jeopardized additional federal funding. Because Bechtel wanted nothing more than to close M3 on time, Dr. Tamosaitis's concurrence in the call for additional testing put him at loggerheads with Bechtel. To keep the M3 closure on schedule, Mr. Russo solicited contrary opinions from other professionals, and also tried to get some of the dissenting professionals to retract their opinions. This did not sit well with Dr. Tamosaitis, but ultimately Bechtel and Mr. Russo prevailed in getting closure of the M3 issue on June 30, 2010.

¶ 9 That same day, Mr. Russo sent an e-mail to the entire M3 team, congratulating them on a job well done. The next day, Dr. Tamosaitis privately commented via e-mail about Mr. Russo's e-mail to some of the consultants and professionals who had supported his position. This e-mail contained some language about the Consortium for Risk Evaluation with Stakeholder Participation (CRESP), one of the outside organizations that advised Bechtel on the M3 closure issue. Dr. Tamosaitis's comments ended up being forwarded to CRESP. CRESP's director found Dr. Tamosaitis's comments disparaging and a misrepresentation of its position with regard to M3.

¶ 10 CRESP expressed these concerns to Mr. Ashley, who then called Mr. Russo and asked him to get Dr. Tamosaitis kicked off the WTP project. Mr. Russo then sent an e-mail to URS's Bill Gay, saying, “Walt[er Tamosaitis] is killing us” and “Get him into your corporate office today.” CP at 1763, 1765. Mr. Gay removed Dr. Tamosaitis from his role at the WTP.

¶ 11 URS did not terminate Dr. Tamosaitis's employment and he did not lose any pay as a result of the reassignment. However, Dr. Tamosaitis did lose some books and other personal items of value when Bechtel and URS prohibited him from returning to his WTP office after the reassignment. Dr. Tamosaitis's removal also negatively affected his mental health, causing him to start taking depression and anxiety medication. Dr. Tamosaitis further claimed that his removal negatively affected his professional reputation throughout the sphere of DOE contractors and prevented him from advancing to URS's executive pay grades. Finally, Dr. Tamosaitis presented some evidence suggesting that his removal resulted in him not being considered for some other positions at the WTP, although there was no evidence showing that any of these positions would have resulted in higher pay or benefits.

¶ 12 A few months after his removal and reassignment, Dr. Tamosaitis brought this cause of action against Bechtel, Mr. Russo, and Mr. Ashley for intentional interference with his business relationship with URS—specifically, tortious interference with Dr. Tamosaitis's employment relationship with URS. After a period of discovery and a failed attempt to remove this case to federal court, the defendants brought a motion for summary judgment. The trial court granted summary judgment on a number of grounds and Dr. Tamosaitis appealed. He initially sought direct review by the Supreme Court, but the motion was denied and the Supreme Court transferred the case to this court per RAP 4.2(e)(1).

¶ 13 While this appeal was pending, URS informed Dr. Tamosaitis in early 2013 that he would not be receiving an incentive pay bonus for the first time in his history with the company. URS stated that reinstatement of incentive pay would be conditioned on Dr. Tamosaitis obtaining an assignment on another URS contract. Dr. Tamosaitis had not worked on another URS contract since shortly after leaving the WTP. However, he still received incentive pay in 2011 and 2012.

¶ 14 Dr. Tamosaitis then moved in superior court for CR 60 relief based on his new evidence of damages. The court denied the motion and Dr. Tamosaitis appealed that decision to this court. The two appeals were consolidated.

¶ 15 After the consolidation, URS formally terminated Dr. Tamosaitis's employment in October 2013. Dr. Tamosaitis moved in his brief to supplement the record with evidence of his termination. Bechtel moved to strike the brief containing the materials.

ANALYSIS

¶ 16 We address, in order, the summary judgment ruling, the motions relating to supplementationof the record, and the order denying CR 60 relief.²

Summary Judgment

¶ 17 Review of summary judgment is pursuant to well understood principles. The appellate court engages in the same inquiry as the trial court. Mountain Park Homeowners Ass'n v. Tydings, 125 Wash.2d 337, 341, 883 P.2d 1383 (1994). “This court will affirm summary judgment if no genuine issue of any material fact exists and the moving party is entitled to judgment as a matter of law.” Id. “All facts and reasonable inferences are considered in the light most favorable to the non-moving party, and all questions of law are reviewed de novo.” Id. However, “a question of fact may be determined as a matter of law when reasonable minds can reach only one conclusion.” Miller v. Likins, 109 Wash.App. 140, 144, 34 P.3d 835 (2001).

¶ 18 “To prove tortious interference, the plaintiff must produce evidence sufficient to support all the following findings: (1) the existence of a valid contractual relationship or business expectancy; (2) the defendant's knowledge of and intentional interference with that relationship or expectancy; (3) a breach or termination of that relationship or expectancy induced or caused by the interference; (4) an improper purpose or the use of improper means by the defendant that caused the interference; and (5) resultant damage.” Eugster v. City of Spokane, 121 Wash.App. 799, 811, 91 P.3d 117 (2004). As previously stated, we solely address the final element of damages.

¶ 19 Bechtel primarily argues that the “resultant damage” element requires some evidence of damages that are of pecuniary value and cites to Washington cases that stated as much in passing. See e.g., Newton Ins. Agency & Brokerage, Inc. v. Caledonian Ins. Grp., Inc., 114 Wash.App. 151, 158, 52 P.3d 30 (2002). We now expressly hold that a claim of tortious interference with a business expectancy requires a threshold showing of resulting pecuniary damages.

¶ 20 Washington courts have...