Wholey v. Sears

• Citation: 803 A.2d 482,370 Md. 38
• Decision Date: 19 June 2002
• Docket Number: No. 105,105
• Parties: Edward L. WHOLEY v. SEARS ROEBUCK, et al.
• Court: Court of Appeals of Maryland

803 A.2d 482

370 Md. 38

Edward L. WHOLEY v. SEARS ROEBUCK, et al.

No. 105, Sept. Term, 2001.

Court of Appeals of Maryland.

June 19, 2002.

James Brewster Hopewell, Riverdale, for petitioner.

Michael Nicholas Petkovich (Jackson, Lewis, Schnitzler & Krupman, on brief) Washington, DC, for respondents.

BELL, C.J., ELDRIDGE, RAKER, WILNER, CATHELL, HARRELL and BATTAGLIA, JJ.

BATTAGLIA, Judge.

The decisional issue before this Court is whether Maryland recognizes a common law public policy exception to the at-will employee doctrine whereby discharging an employee for investigating and reporting the suspected criminal activity of a co-worker would constitute a wrongful discharge. We conclude that a clear public policy mandate exists in the State of Maryland which protects employees from a termination based upon the reporting of suspected criminal activities to the appropriate law enforcement authorities. While we recognize such an exception, the petitioner's actions in this case, i.e. the investigation of suspected criminal activity of a store manager and reporting of that suspicion to his supervisors, do not qualify for this exception.

I. Background

The petitioner, Edward L. Wholey, was employed by the respondent, Sears, Roebuck and Co. ("Sears"), at its Glen Burnie, Maryland store as a security officer for twenty-four years, from February, 1972 until February, 1996. The petitioner had law enforcement experience prior to joining Sears, and he maintained his status and employment as a law enforcement officer during much of his tenure with Sears, with the full knowledge and approval of the company.¹ Within six months of commencing his employment at Sears, the petitioner was promoted to Assistant Security Manager, and in 1980, he was promoted to Security Manager. The petitioner's assigned duties included investigating suspicious behavior and reporting thefts of the store's merchandise by both customers and employees.

In March of 1995, the petitioner observed the manager of the Glen Burnie store take merchandise from the store floor into his personal office, itself a violation of company policy. The merchandise would then disappear from the manager's office. Several similar observations occurred throughout 1995, and the petitioner reported this suspicious behavior to his superior, the District Manager for Security, John Eiseman ("Eiseman"), who told the petitioner to maintain his scrutiny.

The suspicious activity continued; various Sears items were observed in the manager's office, with price tags still attached and no evidence of receipts for payment. When the petitioner informed Eiseman that the manager continued to take store merchandise into his office, and that the merchandise would subsequently disappear from his office, Eiseman offered the petitioner the use of a surveillance van so that the petitioner could, on occasion, observe the manager from outside the store. The manager's suspicious conduct continued, however, and the petitioner suggested to Eiseman that they install a camera to monitor his activities with respect to the disappearing merchandise. According to the petitioner, Eiseman approved the request and in the early morning of December 16, 1995, the petitioner and Darlene Hill, the Loss Control Manager at Sears and one who had also observed similar suspicious activity by the manager, installed a camera. Later that day, the petitioner informed Eiseman that the camera was installed and suggested that Eiseman inform his superior, the District Store Manager, about the camera installation. Sometime within the following two hours, Eiseman instructed the petitioner to remove the camera from the store because his superiors ordered its removal, asserting that a store manager was entitled to more respect. The camera was immediately removed and the investigation of the manager was thereafter discontinued.

Fewer than two months later, on February 6, 1996, the petitioner was fired from his position. Eiseman had met with the petitioner a few days earlier and told him that his superiors disliked the petitioner's "cop mentality," and did not approve of the petitioner's handling of the investigation of the manager, particularly with regard to the installation of the camera in the manager's office. Eiseman told the petitioner to resign, and should he refuse to resign, he advised the petitioner that he would be fired. The petitioner refused to resign and, therefore, was fired. Sears alleged that the termination was the result of a security problem that occurred at the store during a blizzard in January of 1996.² The petitioner asserts that such a basis was merely pretextual and that the true reason for his termination was retaliation for the petitioner's investigation of the store manager for theft. The only issue on appeal, before both this Court and the Court of Special Appeals, is whether Maryland recognizes a public policy mandate regarding the investigation and reporting of criminal activity such that the discharge of an at-will employee for such would be unlawful. Given that instructions to the jury and the jury's verdict thereafter make plain that the jury found the motive for the petitioner's discharge to be his investigation of the store manager, given that the sufficiency of those findings is not at issue, and given that in either case, we view evidence in the light most favorable to the plaintiff (the petitioner) on a defendant's motions for summary judgment and judgment notwithstanding the verdict (J.N.O.V.), see Caldor, Inc. v. Bowden, 330 Md. 632, 636, 625 A.2d 959, 960 (1993)

(quoting Kentucky Fried Chicken Nat'l Management Co. v. Weathersby, 326 Md. 663, 666, 607 A.2d 8, 9 (1992)), we proceed under the assumption that the sole reason for the petitioner's termination was for his investigation of the store manager, and subsequent reporting to his supervisor at Sears, and not for any failure to handle a security matter as Sears initially alleged.

Seven months after he was terminated, the petitioner filed a complaint in the Anne Arundel County Circuit Court against Sears and Eiseman, alleging wrongful discharge and defamation (based on a document written by Eiseman regarding the reasons for the petitioner's discharge) against each defendant. With respect to the wrongful discharge claim, Sears filed a motion to dismiss and a motion for summary judgment which similarly argued that, assuming the facts as alleged by the petitioner, the termination from at-will employment did not violate a clear mandate of public policy and thus was not actionable. Both motions ultimately were denied. Sears again advocated that position when it moved for judgment at the close of the petitioner's case and at the close of trial. In each instance, the petitioner responded, and the trial court ultimately agreed, that Maryland public policy favors the investigation and prosecution of crimes, and thus the petitioner's termination contravened a clear mandate of public policy. With respect to the wrongful discharge claim, the trial court instructed the jury, over Sears's objection, as follows:

In order to recover for wrongful discharge, [the petitioner] must show, one, an at-will employment relationship; two, that he was terminated by the employer and that the discharge was contrary to a clear mandate of public policy ...

Now, there is a clear public policy in Maryland favoring the investigation and prosecution of criminal offenses.

If you find that the motivation of [Sears] in firing [the petitioner] was in retaliation to [the petitioner's] investigatory activities, then that motivation would contravene the stated public policy of Maryland. You must also find that [the petitioner's] investigatory activities were lawful and in accordance with the stated procedures set forth by [Sears].

A jury returned a verdict in favor of petitioner against the respondent, Sears, on the wrongful discharge count. The jury returned verdicts in favor of Sears on the defamation count and in favor of Eiseman on both the defamation and wrongful discharge counts. Sears appealed the judgment on the wrongful discharge count to the Court of Special Appeals.

The Court of Special Appeals reversed the judgement of the Circuit Court, holding that "no clear mandate of public policy was implicated in Sears's termination of [the petitioner's] employment, as a matter of law." See 139 Md.App. 642, 660, 779 A.2d 408, 419 (2001).

The petitioner sought, and we granted, a writ of certiorari to consider whether there exists a clear public policy mandate in Maryland with respect to the investigation and reporting of criminal activity such that terminating an at-will employee for his/her involvement in investigating the possible criminal activity of another employee constitutes a wrongful discharge. See Wholey v. Sears, 367 Md. 88, 785 A.2d 1292 (2001)

II. Discussion

The pivotal issue in this case is whether a clear mandate of public policy favoring the investigation and reporting of suspected criminal activity exists in Maryland such that the termination of an at-will employee who acted congruent with this public policy is wrongful. Whether the petitioner may maintain a cause of action against Sears is dependent upon favorable resolution of this issue, and further, that he meets the requirements to sustain this cause of action, should one be adopted. The viability of a legal cause of action is clearly a question of law which, as with all questions of law, this Court shall review de novo. See Register of Wills for Balt. County v. Arrowsmith, 365 Md. 237, 249, 778 A.2d 364, 371 (2001)

("[A]s is consistent with our review for all questions of law, we review the order and judgment de novo."); Watson v. Peoples Security Life Ins. Co., 322 Md. 467, 478, 588 A.2d 760, 765 (1991)(stating that "it is for the court to determine, on any state of facts generated by the evidence, whether the relevant public policy considerations constitute the [requisite] `clear...