Reedy v. White Consol. Industries, Inc.
| Decision Date | 03 July 1995 |
| Docket Number | No. C 91-3026.,C 91-3026. |
| Parties | Larry REEDY, Plaintiff, v. WHITE CONSOLIDATED INDUSTRIES, INC., a Delaware Corporation, d/b/a/ WCI Laundry Division, Defendant. |
| Court | U.S. District Court — Northern District of Iowa |
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Tito Trevino, Trevino Law Office, Fort Dodge, IA, for plaintiff Larry Reedy.
Stephen D. Turner and David W. Centner of Law, Weathers & Richardson, P.C., Grand Rapids, MI, for defendant WCI.
TABLE OF CONTENTS
I. INTRODUCTION AND PROCEDURAL BACKGROUND .................................... 1424
II. THE MOTION FOR SUMMARY JUDGMENT ........................................... 1425
A. Standards For Summary Judgment ......................................... 1426
B. Findings Of Fact ....................................................... 1427
1. Undisputed facts .................................................... 1427
2. Disputed facts ...................................................... 1429
C. Legal Analysis ......................................................... 1430
1. The retaliatory discharge claim ................................... 1431
a. Recognition of the public policy exception under Iowa law ..... 1431
b. Discharge interfering with workers compensation lights ........ 1433
C. Reedy's retaliatory discharge claim ........................... 1434
2. The "bad faith" claim ............................................. 1435
a. The bad-faith cause of action under Iowa law .................. 1435
b. Jury question or question of law? ............................. 1437
C. Reedy's bad-faith claim ....................................... 1439
3. The intentional infliction of emotional distress claim ............ 1440
a. Elements of the tort .......................................... 1440
b. The outrageousness of defendant's conduct ..................... 1441
c. Sufficiency of plaintiffs emotional distress .................. 1443
D. Conclusion ............................................................ 1444
III. THE MOTION TO STRIKE EXPERTS ............................................. 1445
A. The Proffered Experts ................................................. 1445
B. Legal Analysis ........................................................ 1446
1. Standards for expert witnesses .................................... 1446
2. Admissibility of the proffered experts' opinions .................. 1447
C. Conclusion ............................................................ 1448
IV. THE MOTION FOR RULING IN ADVANCE OF TRIAL ................................. 1448
A. Background ............................................................. 1449
B. Legal Analysis ......................................................... 1449
1. Admissibility of administrative findings generally ................. 1449
2. Admissibility of the Industrial Commission reports ................. 1450
C. Conclusion ............................................................. 1451
V. CONCLUSIONS ............................................................... 1451
This diversity action under Iowa law compels the court once again to navigate the increasingly explored, but still largely uncharted and sometimes treacherous waters of Iowa's common-law cause of action for first party bad faith. Here, a former employee alleges wrongful or retaliatory discharge in violation of public policy by his employer in an attempt to interfere with or retaliate for the employee's right to claim workers compensation benefits, bad faith termination of workers compensation benefits, and intentional infliction of emotional distress. The defendant employer has moved for summary judgment on all claims. The employer asserts that the plaintiff has no wrongful discharge claim, because the plaintiff was legitimately terminated for misrepresentation of his physical condition and health history; that the plaintiff has no "bad faith" claim for coverage, because workers compensation coverage in such circumstances was "fairly debatable" and because the employer sought advice of counsel before terminating coverage; and that there has been no outrageous conduct attributable to the employer upon which to found an intentional infliction of emotional distress claim. The employer has also moved to strike two of plaintiff's proffered experts as insufficiently qualified to give expert testimony in this matter. Plaintiff has moved for a ruling in advance of trial on the admissibility of findings in the state administrative procedures pertaining to his claim for workers compensation benefits.
Plaintiff Larry Reedy, an Iowa resident, filed this diversity action on March 28, 1991, against his former employer, White Consolidated Industries, Inc. (WCI), a Delaware Corporation with its principal place of business in Cleveland, Ohio. Reedy worked for WCI's Laundry Division, which has a facility in Hamilton County, Iowa, but was discharged on June 21, 1990. In Reedy's original complaint, Division I, Count I, Reedy alleged wrongful and retaliatory discharge in an attempt by the employer to interfere with or retaliate for Reedy's right to claim workers compensation benefits. In Count II of that Division, Reedy sought punitive damages. In Division II of the original complaint, Count I alleged bad faith refusal to pay workers compensation benefits, and Count II sought punitive damages on the bad faith claim. WCI answered the original complaint on April 29, 1991.
On July 15, 1992, the Hon. Donald E. O'Brien, now Senior Judge of this court, certified two questions to the Iowa Supreme Court. Those questions were as follows:
Upon joint motion of the parties, this matter was stayed on August 3, 1992, until the determination of the questions certified to the Iowa Supreme Court. On July 22, 1993, the Iowa Supreme Court answered both questions in the affirmative. Reedy v. White Consol. Ind., Inc., 503 N.W.2d 601 (Iowa 1993). However, in light of that decision, on September 15, 1993, the court granted a further stay until an adjudication was made on the appeal of the decision of the Iowa Industrial Commissioner.
On October 31, 1994, finding that the proceedings before the Iowa Industrial Commissioner had been concluded, and finding further that the parties agreed that the stay should be lifted, Chief Magistrate Judge John A. Jarvey entered an order lifting the stay and establishing a schedule to bring this matter to trial. That order established, inter alia, a deadline of November 15, 1994, for motions to amend, a deadline of February 15, 1995, for the designation of expert witnesses, and a deadline of May 1, 1995, for all dispositive motions.
On December 8, 1994, Judge Jarvey granted Reedy's motion for leave to amend his complaint. The amended complaint adds, as Division III, two further counts. Count I of the new division alleges intentional infliction of emotional distress as the result of WCI's failure to provide workers compensation benefits. Count II of this new division seeks punitive damages on Reedy's claim of intentional infliction of emotional distress. WCI answered the additional counts of the amended complaint on January 20, 1995.
On April 25, 1995, Judge Jarvey granted an extension until May 22, 1995, for the filing of dispositive motions. WCI therefore timely filed a motion for summary judgment on all claims in Reedy's amended complaint on May 22, 1995. Also on May 22, 1995, WCI moved to strike two of plaintiff's experts designated on November 14, 1991. Presumably because of the stay in this matter, WCI did not depose two of these experts, Leonard Weaver and John J. Puk, until March 21, 1995. WCI requested oral arguments on both motions. Reedy resisted both the motion for summary judgment and the motion to strike experts on June 5, 1995, but joined in the requests for oral arguments on these motions. The court therefore set telephonic oral arguments on both motions for June 30, 1995.
On June 8, 1995, Reedy moved for a ruling in advance of trial on the admissibility of findings in the administrative procedures pertaining to his claim for workers compensation benefits. The parties were requested to prepare oral arguments on this motion for June 30, 1995, as well.
At the oral arguments on June 30, 1995, plaintiff Larry Reedy was represented by counsel Tito Trevino of the Trevino Law Office in Fort Dodge, Iowa. Defendant WCI was represented at oral arguments by counsel Stephen D. Turner and David W. Centner of Law, Weathers & Richardson, P.C., in Grand Rapids, Michigan. The court found the briefs and oral arguments of the provided by counsel to be of unusually high quality and consequently most helpful in disposition of these motions. Finding these matters fully submitted, the court turns to disposition of the various motions.
WCI has moved for summary judgment on each of Reedy's claims. As to the retaliatory discharge claim, WCI asserts that the record is absolutely clear that Reedy was fired for misrepresenting his...
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