United States ex rel. Barrick v. Parker-Migliorini Int'l
| Docket Number | 22-4049 |
| Decision Date | 22 August 2023 |
| Parties | UNITED STATES OF AMERICA ex rel. BRANDON BARRICK, Plaintiff - Appellee, v. PARKER-MIGLIORINI INTERNATIONAL, LLC, Defendant-Appellant. |
| Court | U.S. Court of Appeals — Tenth Circuit |
Appeal from the United States District Court for the District of Utah (D.C. No. 2:12-CV-00381-JNP)
Mark R. Gaylord, (Jason D. Boren and Jacqueline Mabatah of Ballard Spahr LLP, with him on the briefs), Salt Lake City, Utah, for Defendant - Appellant.
Katie Panzer (April Hollingsworth of Hollingsworth Law Office, LLC with her on the brief), Salt Lake City, Utah, for Plaintiff - Appellee.
Before BACHARACH, KELLY, and CARSON, Circuit Judges.
In April 2012, Plaintiff-Appellee Brandon Barrick filed this qui tam action against his then-employer, Defendant-Appellant Parker-Migliorini International LLC (PMI). Mr. Barrick alleged violations of the False Claims Act (FCA) and amended his complaint to include a claim that PMI unlawfully retaliated against him under the FCA.[1] 31 U.S.C. § 3730(h).
A jury found that PMI retaliated against Mr. Barrick for his engagement in protected activity under the FCA when it terminated his employment on November 14, 2012. On appeal PMI argues that the district court improperly denied its motion for judgment as a matter of law (JMOL). In the alternative, PMI argues that this court should order a new trial based on either the district court's erroneous admission of evidence or an erroneous jury instruction. At the least, PMI argues the district court erred in granting Mr. Barrick reinstatement without an evidentiary hearing and this court should remand so PMI can be heard. Aplt. Br. at 11-12. We have jurisdiction under 28 U.S.C. § 1291 and we affirm on all issues.
In 2012, Mr. Barrick was working as a senior financial analyst in the accounting department for PMI. PMI is a meat exporting company based in Utah. While working for PMI, Mr. Barrick noticed two practices he believed were illegal. The first was the "Japan Triangle": PMI exported beef to Costa Rica to a company called Vision Commercial, which repackaged it, then sent it to Japan. At that time, Japan was concerned about mad cow disease from U.S. beef and was only accepting U.S. beef that passed higher levels of inspection. The second was the "LSW Channel": PMI informed the U.S. Department of Agriculture (USDA) it was shipping beef to Moldova on a shipping certificate, but sent it to Hong Kong. Then, according to Mr. Barrick, PMI smuggled the beef into China. At the time, China did not accept U.S. beef.
Mr. Barrick brought his concerns to Steve Johnson, PMI's CFO, at least three times. Mr. Johnson confirmed these shipping practices existed, and Mr. Barrick testified that Mr. Johnson also confirmed that they were illegal. Part of these conversations included review of files Mr. Barrick prepared, as part of his job, that reflected profit and loss on each shipment, including the inspection fees the USDA charged. Mr. Barrick told Mr. Johnson that he was not comfortable with the practices.
In April 2012, Mr. Barrick contacted attorneys and filed this qui tam action under seal, alleging PMI's exporting activities violated the False Claims Act. After doing so, Mr. Barrick worked with the USDA, DOJ, and FBI and became a confidential informant for the FBI. He started recording conversations with Mr. Johnson about PMI's shipping activities. To get the information the FBI wanted, Mr. Barrick asked Mr. Johnson repeated questions that he already had the answers to about the Japan Triangle and LSW Channel.
On October 10, 2012, the FBI raided PMI's office. The FBI conducted interviews with some of the employees on site, including Mr. Barrick. The day after the raid, PMI asked for an inventory of all employee badges. Mr. Barrick could not provide his until the next day because he had given it to FBI Special Agent (SA) Crystal Bowen. The day after the raid PMI also imaged all employee computers and sent a memo to employees asking them to meet and relay what they had told the FBI. Mr. Barrick responded that he would not participate without his attorney present, and in communication with PMI's attorney, Mr. Barrick's counsel was informed that refusing to participate could result in termination. PMI claims that at the time, it did not know what the FBI was looking into.
On the same morning of the raid, SA Bowen went to Mr. Johnson's home to interview him. She prepared an FBI 302 Report ("302 Report") after the interview. It is standard FBI practice to prepare the report within five days of the interview. The 302 Report is not a transcript and was not contemporaneous with the interview, but SA Bowen used her notes she took during the interview and her memory to prepare the 302 Report. SA Bowen testified about the process of preparing such a report and how it is based upon the information and her recall of the statements provided by the interviewee. SA Bowen's testimony and the 302 Report reflect that Mr. Johnson provided answers to her questions regarding the Japan Triangle and LSW Channel. There was also a USDA agent present during the interview.
Mr. Barrick was terminated from PMI on November 14, 2012, about one month after the raid, as part of a company-wide reduction in force (RIF). PMI claimed the RIF was needed because in addition to the FBI raid, problems with exports and bank lines of credit put a financial strain on the company. Nine employees were terminated as part of the RIF. PMI claims it did not learn about Mr. Barrick's cooperation with the FBI until October 2014, when the DOJ notified PMI of this qui tam action. Aplt. Br. at 7.[2]
The jury trial took place from June 28 to July 2, 2021. At trial, PMI objected to admission of the 302 Report. At the close of Mr. Barrick's case, PMI orally moved for directed verdict (JMOL) under Rule 50(a) and the district court took the motion under advisement. The jury returned a verdict in favor of Mr. Barrick, finding by a preponderance of the evidence PMI retaliated against him for his engagement in a protected activity. The jury awarded Mr. Barrick $125,000 in damages, an award not now challenged.
After trial, PMI renewed its motion for JMOL. Mr. Barrick moved for reinstatement, seeking either reinstatement or front pay. On March 25, 2022, in separate orders the district court granted Mr. Barrick's motion for reinstatement and denied PMI's renewed motion for JMOL. The court also entered judgment. On April 22, 2022, PMI filed a Rule 52(b) and 59(e) motion to amend, requesting an evidentiary hearing on the issue of reinstatement. The district court denied the motion.
Our review is de novo. Harte v. Bd. of Comm'rs, 940 F.3d 498, 522 (10th Cir. 2019). We consider whether there is a "legally sufficient evidentiary basis for a reasonable jury to find for the moving party." Id. at 522 (quoting Keylon v. City of Albuquerque, 535 F.3d 1210, 1215 (10th Cir. 2008)). We take all reasonable inferences in favor of the nonmovant (Mr. Barrick) and disregard all evidence favorable to PMI that the jury is not required to believe. Reeves v. Sanderson Plumbing Prod., Inc., 530 U.S. 133, 150-51 (2000). We do not reweigh the evidence, make credibility determinations, or challenge the legitimate factual conclusions of the jury. Id. JMOL is appropriate only if, after reviewing the entire record, "there is no legally sufficient evidentiary basis for a claim under the controlling law." Hysten v. Burlington N. Santa Fe Ry. Co., 530 F.3d 1260, 1269 (10th Cir. 2008). !
The FCA imposes liability for submitting false statements to the government to claim additional payment or to avoid payment of an obligation. 31 U.S.C. § 3729(a)(1)(A), (G). The FCA prohibits retaliation for "lawful acts done by the employee . . . in furtherance of an action under this section or other efforts to stop 1 or more violations of this subchapter." Id. § 3730(h)(1). To demonstrate retaliation, Mr. Barrick must show: (1) he was engaged in a protected activity; (2) PMI had notice he was engaged in a protected activity; and (3) PMI terminated him because of his engagement in a protected activity. See United States ex rel. Sorenson, 48 F.4th 1146, 1158-59 (10th Cir. 2022).
PMI argues the evidence is insufficient to support the notice and causation elements.[3]
1. Standard for notice under the FCA
PMI contends that under Sorenson, Mr. Barrick was required to "convey a connection to the FCA" to put PMI on notice. Aplt. Br. at 13. Mr. Barrick argues Sorenson does not stand for that proposition, and PMI did not need to know Mr. Barrick's activity had a nexus with the FCA. Rather, all PMI needed to know was he was engaged in a protected activity. Aplee. Br. at 10-11. Mr. Barrick recognizes his protected activity needs a nexus to the FCA. Id. at 11-12; United States ex rel. Reed v. KeyPoint Gov't Sols., 923 F.3d 729, 767 (10th Cir. 2019). But Mr. Barrick contends PMI does not need knowledge of the nexus to show notice. Aplee. Br. at 11-12.[4]
Mr Barrick's activity does not need to lead to a viable qui tam claim. Reed, 923 F.3d at 765. To the extent PMI implies Mr. Barrick needed to say magic words, such as "FCA violation" or "fraudulent report to the government to avoid payment," to put PMI on notice, this is contrary to the text of the FCA which protects "other efforts" to stop violations. 31 U.S.C. § 3730(h)(1); see Reed, 923 F.3d at 767. And, to the extent PMI argues an employer must know it is the FCA being violated, and know of the FCA and its elements, this is also incorrect. Moreover, PMI conceded both of these points before this court and before the...
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