University of Houston v. Barth

• Decision Date: 03 July 2008
• Docket Number: No. 01-06-00490-CV.,01-06-00490-CV.
• Citation: 265 S.W.3d 607
• Parties: The UNIVERSITY OF HOUSTON, Appellant, v. Stephen BARTH, Appellee.
• Court: Texas Court of Appeals

265 S.W.3d 607

The UNIVERSITY OF HOUSTON, Appellant, v. Stephen BARTH, Appellee.

No. 01-06-00490-CV.

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

July 3, 2008.

Rehearing Overruled October 13, 2008.

Shelley Alisa Dahlberg, Asst. Atty. Gen., Austin, for Appellant.

J.W. Beverly, Dow Golub Berg & Beverly, LLP, Houston, for Appellee.

Panel consists of Justices NUCHIA, ALCALA, and HIGLEY.

OPINION

LAURA CARTER HIGLEY, Justice.

The University of Houston ("the University") appeals a judgment rendered pursuant to a jury's verdict finding that the University violated the Texas Whistleblower Act¹ ("the whistleblower act") by retaliating against Stephen Barth, a tenured professor at the University's Conrad N. Hilton College of Hotel Management, after he reported to university officials that the college's dean had violated the law. Barth was awarded actual damages and attorney's fees against the University based on its violation of the whistleblower act.

Of the six issues raised by the University, the dispositive issues that we address are (1) whether the trial court lacked jurisdiction over Barth's claims because he did not timely initiate the University's grievance procedure; (2) whether legally-sufficient evidence supports a finding that Barth reported a violation of the law to the appropriate law enforcement authorities; (3) whether legally-sufficient evidence supports a finding that Barth reported a violation of the law in good faith; and (4) whether legally sufficient evidence supports the jury's finding that Barth's report of a violation of the law caused the University to take an adverse employment action against him.

We reverse and remand.

Factual & Procedural Background

In February or early March 1999, Barth reported to the University's chief financial officer and to its general counsel that the dean of the University's Conrad N. Hilton College of Hotel Management ("Hilton College"), Alan Stutts, had engaged in questionable accounting practices, mishandled university funds, and entered into an unauthorized contract for services on behalf of the college. In May 1999, Barth also reported Stutts's conduct to the University's internal auditor.

As dean of Hilton College, Stutts was Barth's supervisor. On June 17, 1999, Stutts completed Barth's annual evaluation for the 1998-1999 academic year ("the 1999 evaluation"). In the evaluation, Stutts gave Barth a "marginal" rating with respect to "grantsmanship," which pertained to Barth's success in obtaining outside grants for the college. The marginal rating adversely affected the merit raise received by Barth.

Also in 1999, Barth was denied funds for travel related to his position. In addition, after Barth reported Stutts's conduct, Stutts withdrew his participation in a symposium created by Barth from which Barth received $10,000 in annual compensation. After Stutts stopped participating, one of the symposium's sponsors withdrew its support in December 1999, and the 2000 symposium was cancelled.

On March 10, 2000, Barth filed a grievance with the University's grievance committee. In the grievance, Barth asserted, "Dean Stutts has retaliated against me for making the university administration aware of inappropriate and/or illegal administrative actions by his administration." The following were among the "retaliatory actions taken by Dean Stutts" cited by Barth: (1) "denial of travel dollars"; (2) "arbitrary and capricious evaluation (disparately imparting [sic] me by denying at least $600-$1,000 increase in salary)"; and (3) "withdrawing support for my initiatives including the Hospitality Legal Symposium, causing its cancellation and a loss of reputation in the industry."

On August 17, 2000, Barth filed a second grievance asserting that Stutts had again retaliated against him by giving Barth a lower-than-deserved merit evaluation for the 1999-2000 academic year ("the 2000 evaluation"), which adversely affected his salary increase for the year 2001.

Barth's grievances were not successfully resolved through the University's grievance process. Soon after, Barth filed suit against the University alleging that it had retaliated against him for reporting Stutts's conduct. Barth asserted that such retaliation was a violation of the whistleblower act.

The University filed a plea to the jurisdiction seeking dismissal of Barth's suit. The University asserted, inter alia, that Barth had not timely initiated the grievance process, as required by the whistleblower act, thereby depriving the trial court of subject-matter jurisdiction.

The trial court denied the University's plea to the jurisdiction. We affirmed the denial in University of Houston v. Barth, 178 S.W.3d 157 (Tex.App.-Houston [1st Dist.] 2005, no pet.). Recognizing that the "continuing-violation doctrine" has been applied in Texas whistleblower cases, we concluded, "There are sufficient factual allegations in Barth's pleadings that could invoke the continuing-violation doctrine; whether that doctrine applies and which acts triggered the 90-day limitations period are issues that should be resolved by the trier of fact." Id. at 163 (citing Univ. of Tex.-Pan Am. v. De Los Santos, 997 S.W.2d 817, 820 (Tex.App.-Corpus Christi 1999, no pet.)).

The case was ultimately tried to a jury, but the jury was not asked to make fact-findings pertaining to whether Barth timely filed his grievances. The jury did find that the University had violated the whistleblower act and that Barth was entitled to actual damages totaling $40,000 and $245,000 in attorney's fees. The trial court rendered judgment on the jury's findings.

Presenting six issues for review, the University appeals the judgment.

Jurisdictional Issue: Timeliness of Grievances

In its second issue, the University contends that the trial court lacked subject-matter jurisdiction over Barth's claims because he did not timely initiate the University's internal grievance procedure.

Whistleblower Act Provisions

The whistleblower act provides, "A state or local governmental entity may not suspend or terminate the employment of, or take other adverse personnel action against, a public employee who in good faith reports a violation of law by the employing governmental entity or another public employee to an appropriate law enforcement authority." TEX. GOV'T CODE ANN. § 554.002(a) (Vernon 2004). The act requires that, before filing suit, an employee must initiate his employer's grievance procedure not later than the 90th day after the date on which the alleged violation occurred or was discovered by the employee through reasonable diligence. Id. § 554.006(b) (Vernon 2004). If the employee does not timely initiate the grievance procedure, then his claims are jurisdictionally barred. Tex. S. Univ. v. Carter, 84 S.W.3d 787, 792 (Tex.App.-Houston [1st Dist.] 2002, no pet.); see TEX. GOV'T CODE ANN. § 311.034 (Vernon Supp.2007) (providing, as amended in 2005, that "[s]tatutory prerequisites to a suit, including the provision of notice, are jurisdictional requirements in all suits against a governmental entity").

Deemed Findings

As mentioned, we concluded in the earlier interlocutory appeal that, given Barth's allegations, whether Barth timely initiated the grievance process was a question of fact to be determined by the fact finder. Barth, 178 S.W.3d at 163. Nevertheless, the jury was not asked to make fact findings regarding the timeliness of Barth's grievances.

Barth contends that we must deem as found a finding in support of the judgment that Barth timely filed his grievances. Generally, when a ground of recovery consists of multiple issues, and the jury charge omits issues that constitute only a part of that ground, while other issues necessarily referable to that ground are submitted and found, the omitted elements are deemed found in support of the judgment if no objection is made, and they are supported by some evidence. TEX.R. CIV. P. 279; Ramos v. Frito-Lay, Inc., 784 S.W.2d 667, 668 (Tex.1990). Statutory notice requirements can be the subject of a deemed finding. U.S. Tire-Tech, Inc. v. Boeran, B.V., 110 S.W.3d 194, 200 (Tex. App.-Houston [1st Dist.] 2003, pet. denied); see Tex. Tech Univ. Health Sciences Ctr. v. Apodaca, 876 S.W.2d 402, 410-412 (Tex.App.-El Paso 1994, writ denied) (deeming as found finding that actual notice had been given under Texas Tort Claims Act after court concluded that notice provision was not separate ground of recovery "but was a component of the ultimate issue of the claimant's right of recovery"); U.S. Fire Ins. Co. v. Ramos, 863 S.W.2d 534, 537-38 (Tex.App.-El Paso 1993, writ denied) (holding that statutory notice requirement of worker's compensation statute was not independent ground of recovery; thus, notice element could be subject of deemed finding).

Here, the jury made positive liability findings against the University on Barth's whistleblower claim. The University did not object to the lack of submission of the issue regarding the timeliness of Barth's grievances. If supported by some evidence, we must deem as found findings supporting the conclusion that Barth timely filed his March 10, 2000 and his August 17, 2000 grievances. See Ramos, 784 S.W.2d at 668. That is, we review the record to determine whether there is legally sufficient evidence to support the deemed findings. See In retrograde extrapolation In re J.F.C., 96 S.W.3d 256, 276 (Tex.2002).

In deciding a legal sufficiency challenge, we determine whether there is evidence that would enable reasonable and fair-minded people to reach the verdict under review. City of Keller v. Wilson, 168 S.W.3d 802, 827 (Tex.2005). To make this determination, we (1) credit all favorable evidence that reasonable jurors could believe; (2) disregard all contrary evidence, except that which they could not ignore; (3) view the evidence in the light most favorable to the verdict; and (4) indulge every reasonable inference that would support the verdict. Id. at 822, 827. But, w...