Tex. Dep't Of Human Serv. v. Okoli

• Decision Date: 17 June 2010
• Docket Number: No. 01-07-00103-CV.,01-07-00103-CV.
• Citation: 317 S.W.3d 800
• Parties: TEXAS DEPARTMENT OF HUMAN SERVICES, Appellant,v.Oliver OKOLI, Appellee.
• Court: Texas Court of Appeals

317 S.W.3d 800

TEXAS DEPARTMENT OF HUMAN SERVICES, Appellant,v.Oliver OKOLI, Appellee.

No. 01-07-00103-CV.

Court of Appeals of Texas Houston (1st Dist.).

June 17, 2010.

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Russ Wayne Harris, Office of the Attorney General, General Litigation Division, Austin, TX, for Appellant.

Okon J. Usoro, Okon J. Usoro, P.C., Houston, TX, Oliver Okoli, Alief, TX, for Appellee.

Panel consists of Justices JENNINGS, ALCALA, and HANKS.

OPINION

TERRY JENNINGS, Justice.

In this interlocutory appeal,¹ appellant, the Texas Department of Human Services (“TDHS”), challenges the trial court's order denying its plea to jurisdiction filed in the underlying Texas Whistleblower Act ² lawsuit brought against it by appellee, Oliver E. Okoli. In three issues, TDHS contends that Okoli did not, as required by the Whistleblower Act, report a violation of law to an appropriate law enforcement authority or present sufficient evidence to invoke the limited waiver of sovereign immunity provided by the Whistleblower Act and his fraud and malice claims are barred by sovereign immunity.

On June 28, 2007, this Court issued an opinion in which we held that the Whistleblower Act “makes the only jurisdictional prerequisites to maintaining a whistleblower suit the plaintiff's status as a public employee and the sufficiency of his whistleblower allegations” and “whether Okoli actually reported to an appropriate law enforcement authority, or whether he had a good-faith belief that TDHS was such an authority, is an element of his whistleblower claim and cannot be a jurisdictional prerequisite to suit.” Tex. Dep't of Human Servs. v. Okoli, 263 S.W.3d 275, 282 (Tex.App.-Houston [1st Dist.] 2007) rev'd, 295 S.W.3d 667 (Tex.2009). Because we concluded that TDHS, in its jurisdictional plea, asserted and presented evidence on only these non-jurisdictional elements of Okoli's whistleblower claim, we overruled TDHS's issues in which it challenged the trial court's order denying its plea to the jurisdiction.³Id.

The Texas Supreme Court, on August 28, 2009, issued its opinion in State v. Lueck, in which it held that the elements of a whistleblower claim “can be considered to determine both jurisdiction and liability.” 290 S.W.3d 876, 883 (Tex.2009) (citing Tex. Gov't Code Ann. § 554.002(a) (Vernon 2004)). On the same day, the supreme court, in a per curiam opinion, reversed this Court's opinion in Okoli, explaining that, under Lueck, whether Okoli made “a good faith report of a violation of law to an appropriate law enforcement authority is a jurisdictional question.” Tex. Dep't of Health and Human Servs. v. Okoli, 295 S.W.3d 667, 668 (Tex.2009). The supreme court, “for the reasons explained in Lueck,” remanded the Okoli case to this Court “to determine whether Okoli has alleged a violation under the Act.” Id. (citing Tex. Gov't Code Ann. § 554.002(a) (Vernon 2004)).

We affirm the order of the trial court.

Background

As summarized in our original opinion,⁴ Okoli, in his petition, alleges that TDHS hired him as a caseworker trainee and ultimately promoted him to a “Worker II” position, whose job functions included determining the eligibility of TDHS clients for its social programs. According to Okoli, Brendell Carroll, his TDHS supervisor, engaged in fraudulent conduct in processing benefits including, among other things, “falsifying dates and documents to avoid delinquencies in the handling of clients' cases.” Okoli first complained about the date-falsification activity to Carroll, who retaliated against him with certain workplace measures. Okoli then reported the date-falsification activity to Carroll's supervisor, John Robinson, and then to Robinson's manager, Carol Maxie. Shortly after his report to Maxie, TDHS terminated Okoli's employment. Okoli then pursued an administrative grievance procedure to contest his termination, but the termination decision was sustained. Okoli further alleges that when he “reported the unlawful practices in the unit” to Robinson, TDHS terminated his employment, ostensibly “for violating TDHS work rules.” Okoli asserts a claim against TDHS for violations of the Whistleblower Act as well as “cause[s] of action” for fraud and malice.

In its jurisdictional plea, TDHS argued that the trial court lacked subject-matter jurisdiction over Okoli's whistleblower claim because TDHS and “administrators at [TDHS] were not the proper law enforcement authorities for reports of ‘Unlawful Use of Funds' ” and Okoli did not have a good-faith belief that TDHS and his TDHS supervisors were such authorities. TDHS also argued that the trial court lacked subject-matter jurisdiction over Okoli's claims for fraud and malice because the Texas Tort Claims Act (“TTCA”) does not waive immunity from suit for intentional wrongs like these.⁵

In his response, Okoli asserted that Carroll and other TDHS employees violated section 12.002 of the Texas Human Resources Code, entitled “Unlawful Use of Funds.” ⁶ Okoli argued that his report to TDHS was to an appropriate law enforcement authority because TDHS is the governmental entity authorized to regulate under and enforce the subject law. Okoli also argued that he, in good faith, believed that TDHS and his supervisors were authorized to regulate under and enforce section 12.002 because his work rules required employees to make reports of fraudulent conduct to their supervisors. He noted that TDHS is authorized to “refer and fund district attorney's special welfare fraud units for prosecution.” ⁷ Okoli also noted that TDHS admitted that “TDHS, through its Office of Investigation (‘OIG’), investigates the law” that he reported had been violated.

The trial court denied TDHS's jurisdictional plea.

Standard of Review

We review de novo a trial court's ruling on a jurisdictional plea. See Tex. Dep't of Parks & Wildlife v. Miranda, 133 S.W.3d 217, 226 (Tex.2004); Tex. Natural Res. Conservation Comm'n v. IT-Davy, 74 S.W.3d 849, 855 (Tex.2002). When reviewing a trial court's ruling on a plea, “we first look to the pleadings to determine if jurisdiction is proper, construing them liberally in favor of the plaintiffs and looking to the pleader's intent,” and “we consider relevant evidence submitted by the parties when necessary to resolve the jurisdictional issues raised.” City of Waco v. Kirwan, 298 S.W.3d 618, 621-22 (Tex.2009); see also Tex. Natural Res. Conservation Comm'n v. White, 46 S.W.3d 864, 868 (Tex.2001) (“[W]e consider the facts alleged by the plaintiff [s] and, to the extent it is relevant to the jurisdictional issue, the evidence submitted by the parties.”). In considering this evidence, we “take as true all evidence favorable to the nonmovant” and “indulge every reasonable inference and resolve any doubts in the nonmovant's favor.” Kirwan, 298 S.W.3d at 622.

Immunity from suit is properly asserted in a plea to the jurisdiction.⁸ Lueck, 290 S.W.3d at 880. The State and its agencies like TDHS are immune from suit and liability in Texas unless the Legislature expressly waives sovereign immunity. Id.; see also Tex. Gov't Code Ann. § 311.034 (Vernon Supp.2009) (“[A] statute shall not be construed as a waiver of sovereign immunity unless the waiver is effected by clear and unambiguous language.”). A statute waives immunity from suit, immunity from liability, or both. Lueck, 290 S.W.3d at 880. Immunity from suit presents “a jurisdictional question of whether the State has expressly consented to suit,” whereas immunity from liability concerns “whether the State has accepted liability even after it has consented to suit.” Id. In statutes in which immunity from suit is waived to the extent of liability, “immunity from suit and liability are co-extensive.” Id. (citing Tex. Civ. Prac. & Rem.Code Ann. § 101.025(a) (Vernon 2005)).

When a party in a plea to the jurisdiction challenges the pleadings, we determine if the pleadings contain facts that “affirmatively demonstrate” the trial court's jurisdiction to hear the case. Id. at 884. When the facts underlying the merits and subject-matter jurisdiction are intertwined, “the State may assert immunity from suit by a plea to the jurisdiction, even when the trial court must consider evidence ‘necessary to resolve the jurisdictional issues raised.’ ” Id. at 880 (citing Bland Indep. Sch. Dist. v. Blue, 34 S.W.3d 547, 555 (Tex.2000)).

The Whistleblower Act

In its first two issues, TDHS argues that the trial court erred in denying its plea to the jurisdiction because Okoli's “supervisors are not appropriate law enforcement authorities” and Okoli has “not brought forth sufficient evidence to invoke the limited waiver of sovereign immunity provided in the Whistleblower Act.” ⁹ TDHS asserts that it does not regulate or enforce violations of criminal law and Okoli did not have a good faith belief that TDHS supervisors are appropriate law enforcement authorities. TDHS further asserts that “[a]lerting an employer to the employer's own conduct is insufficient as a matter of law to meet the [Whistleblower] Act's ‘law enforcement’ requirement,” and, as a result, Okoli's “supervisors and other TDHS administrators, who were allegedly involved in the illegal acts, were not appropriate law enforcement authorities for purposes of their conduct.”

The immunity provision in the Whistleblower Act ¹⁰ provides:

A public employee who alleges a violation of this chapter may sue the employing state or local governmental entity for the relief provided by this chapter. Sovereign immunity is waived and abolished to the extent of liability for the relief allowed under this chapter for a violation of this chapter.

Tex. Gov't Code Ann. § 554.0035 (Vernon 2004). Section 554.0035 prescribes two requirements to waive a governmental entity's immunity and vest a court with jurisdiction: (1) the plaintiff must be a public employee and (2) he must allege a “violation of this chapter.” Lueck, 290 S.W.3d at 881. The standard for a “violation of this chapter” is found in section 554.002 of the

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