Searching over 5,500,000 cases.

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.


March 18, 2002


The opinion of the court was delivered by: Thomas F. Hogan, Chief Judge.


Plaintiff Frank Riggs has sued his former employer, Home Builders Institute ("HBJ"), its affiliate, the National Association of Home Builders ("NAHB"), and two NAHB officers, Thomas Downs and Robert Mitchell, for wrongful termination, tortious interference with contract and prospective advantage, and civil conspiracy. Defendants HBI, NAHB, Downs, and Mitchell have moved to dismiss the complaint for failure to state a claim upon which relief can be granted, pursuant to Federal Rule of Civil Procedure 12(b)(6). Upon careful consideration of the defendants' motions to dismiss, the oppositions and replies thereto, and the entire record herein, the Court will deny HBI's motion and will grant in part and deny in part NAHB's motion.


Defendant NAHB is a national trade association of home-building contractors with 210,000 members who are organized into local and state home builders associations. Id. ¶ 5. Defendant Thomas Downs is NAHB's Executive Vice President and Chief Executive Officer. Id. ¶ 6. Defendant Robert Mitchell is NAHB's President. Id. ¶ 7. Defendant HBI is a non-profit organization that serves as the educational and training arm of NAHB and is structured as a nonprofit public benefit school, exempt from taxation under section 501(c)(3) of the Internal Revenue Code, 26 U.S.C. § 501 (c)(3). HBI's mandate is to enhance the professionalism of NAHB members through continuing education and to train and place skilled workers into productive industry careers through contracts with the federal government and the private sector. Id. ¶ 4.

In late 1999, HBI and NAHB agreed to expand HBI's mission to champion the homebuilding industry among a new generation of youth. In September 1999, HBI acquired a $1 million grant from the U.S. Department of Labor ("DOL") as part of a school-to-work initiative to introduce thousands of students to the skills and occupations in the home construction industry. Id. ¶¶ 8-9. HBI and NAHB also formed a search committee to recruit a new president for HBI to lead its expanded educational mission. Id. ¶ 10.

After interviewing Riggs, HBI hired him as its President and Chief Executive Officer ("CEO") on December 6, 1999 to spearhead its education mission. Id. ¶¶ 10-13. Under a job description provided to Riggs, he would report to Thomas Woods, the Chairman of HBI's Board of Trustees. The job description emphasized HBI's independence from NAHB. Id. ¶ 10. But NAHB officers, including Downs and Mitchell, nonetheless expected Riggs to play a political role on behalf of NAHB and to use his influence as a former Congressman and national leader of the Republican Party to advance NAHB's efforts to influence political campaigns and legislation. Id. ¶ 15.

In January 2000, Downs asked Riggs to attend political receptions in his capacity as President and CEO of HBI for former Congressman Newt Gingrich and Congressman Rick Lazio at NAHB's International Builders Show. Riggs attended, but felt "uncomfortable with Downs'[s] request that he play a political role on NAHB's behalf — particularly with Mr. Lazio, who, as Chairman of the House of Representatives Housing Subcommittee at the time, was an influential member of the U.S. House of Representatives on issues of importance to NAHB." Id. Downs subsequently asked Riggs to attend the Republican National Convention in August 2000. Downs also emphasized to Riggs at the time that NAHB had established a $1 million "soft money" fund to distribute to the presidential campaigns through national party committees or independent efforts such as "Builders for Bush." Riggs declined to attend the convention, stating to Downs that HBI's status as a tax-exempt educational organization prohibited him from participating in partisan political campaigns. Id. ¶ 16. Downs also urged Riggs to participate in NAHB's weekly Senior Executive Council meetings, at which NAHB's political and legislative agenda was routinely discussed. Id. ¶ 17. Mitchell invited Riggs to attend NAHB's Strategic Implementation Meeting held February 18-20, 2000 in Palm Harbor, Florida. Riggs attended the Meeting, but excused himself from a half-day session entitled "Legislative Agenda/National Election Year," fearing that the session would focus on NAHB plans to influence legislation and political campaigns. Official minutes from the session reflect that NAHB members discussed a proposed resolution to support a presidential candidate in the 2000 election, the formation of political action and fund-raising groups, and a range of legislative initiatives concerning Brownfields, international lumber, and Social Security. Id. ¶ 18.

NAHB's leadership reacted angrily to Riggs's refusal to involve himself in political and legislative activities that he believed would violate section 501(c)(3) of the Internal Revenue Code and various DOL regulations, including 20 C.F.R. § 638.814 (a) and (b), and his insistence upon HBI's legal autonomy from NAHB. Compl. ¶¶ 19-23. NAHB officers, including Downs and Mitchell, mounted a campaign to remove Riggs from the HBI presidency by undermining his efforts as President. Id. ¶¶ 24-25. Despite a decision made by HBI staff during a March 2000 retreat to transfer NAHB's continuing member education and training programs from NAHB to HBI, for example, Riggs experienced hostility and obstruction from Downs and Mitchell when trying to implement the strategic plan. Id. ¶ 26. Downs further refused Riggs's request to present the plan to senior officials of NAHB at a meeting to be held at the Greenbrier in April 2000, choosing instead merely to refer to a letter written by Riggs. Id. ¶¶ 27-30. Minutes from the meeting reflect that senior officers at the meeting discussed the "`reporting relationship' between HBI's president and NAHB's CEO as a `difficult situation that need[ed] to be addressed immediately' "and decided to contact their appointees to the HBI Board to determine "future action." Id. ¶ 30.

On April 17, 2000, Downs informed Riggs that NAHB's senior officers had unanimously decided to terminate his employment. Id. ¶ 31. HBI's Board of Trustees were not involved in the decision of NAHB's senior officers to terminate Riggs's employment, and Woods refused to give Riggs permission to address the full HBI Board of Trustees about his termination out of deference to NAHB and its senior officers. Id. ¶¶ 32-33. Woods then exerted pressure upon Riggs to submit his resignation, and having not received his resignation by May 5, 2000, the Executive Committee of HBI's Board of Trustees voted to terminate his employment, which was ratified by the full board on May 13, 2000. Id. ¶¶ 34-38.

On February 26, 2001, Riggs filed a complaint against Defendants, alleging three counts.*fn2 Count I charges HBI with wrongful discharge in violation of public policy. Id. ¶¶ 41-47. Count II alleges tortious interference with contract and prospective advantage against NAHB, Downs, and Mitchell. Id. ¶¶ 48-54. Count III charges all the defendants with civil conspiracy to wrongfully terminate his employment with HBI. Id. ¶¶ 55-58. Riggs seeks an award of compensatory and consequential damages in an amount of no less than $2,000,000, punitive damages against each of the defendants in the amount of $5,000,000, reinstatement and back pay, and attorneys' fees and costs. Id. at 24.*fn3 All the defendants have moved to dismiss Riggs's complaint, contending that it fails to state a claim upon which relief may be granted, pursuant to Federal Rule of Civil Procedure 12(b)(6).


A. Standard of Review

A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) will be granted only if "it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957); see Hishon v. King & Spalding, 467 U.S. 69, 73, 104 S.Ct. 2229, 81 L.Ed.2d 59 (1984) ("A court may dismiss a complaint only if it is clear that no relief could be granted under any set of facts that could be proved consistent with the allegations."). In reviewing such a motion, the Court must construe the complaint in the light most favorable to plaintiff and must accept as true all allegations and all reasonable factual inferences drawn from well-pleaded factual allegations. See Square D. Co. v. Niagara Frontier Tariff Bureau, Inc., 476 U.S. 409, 411, 106 S.Ct. 1922, 90 L.Ed.2d 413 (1986); In re United Mine Workers Employee Benefit Plans Litig., 854 F. Supp. 914, 915 (D.D.C. 1994). "However, the court need not accept inferences drawn by plaintiffs if such inferences are unsupported by the facts set out in the complaint. Nor must the court accept legal conclusions cast in the form of factual allegations." Kowal v. MCI Communications Corp., 16 F.3d 1271, 1276 (D.C.Cir. 1994) (citing Papasan v. Allain, 478 U.S. 265, 286, 106 S.Ct. 2932, 92 L.Ed.2d 209 (1986)).

B. Analysis

1. Wrongful Discharge, Civil Conspiracy, and Defendant HBI

(a) District of Columbia's At-Will Employment Doctrine

There is no dispute between the parties in this case over the fact that Riggs's employment with HBI was at-will. And as a general rule, District of Columbia law has long recognized the at-will employment doctrine, which states that "an employer may discharge an at-will employee at any time and for any reason, or for no reason at all." Adams v. George W. Cochran & Co., 597 A.2d 28, 30 (D.C. 1991) (citing Wemhoff v. Investors Mgmt. Corp., 528 A.2d 1205, 1208 n. 3 (D.C. 1987); Taylor v. Greenway Restaurant, Inc., 173 A.2d 211 (D.C. 1961); Pfeffer v. Ernst, 82 A.2d 763, 764 (D.C. 1951)). In Adams, however, the D.C. Court of Appeals recognized an intentional tort for wrongful discharge, holding that "there is a very narrow exception to the at-will doctrine under which a discharged at-will employee may sue his or her former employer for wrongful discharge when the sole reason for the discharge is the employee's refusal to violate the law, as expressed in a statute or municipal regulation." 597 A.2d at 34. The plaintiff in Adams was a truck driver who was fired after he refused to drive a truck that did not have an inspection sticker on its windshield, which would have been illegal under municipal regulations. Id. at 29-30 & n. 1 (citing 18 DCMR § 602.4 (1987)). In recognizing the "narrow exception" to the at-will doctrine, the court reasoned:

Adams was forced to choose between violating the regulation and keeping his job — the very choice which . . . he should not have been required to make. Even though the criminal liability facing him was not very great, it was nonetheless unacceptable and unlawful for his employer to compel him to choose between breaking the law and keeping his job.

Id. at 34.

The D.C. Court of Appeals initially resisted further expansion of the "narrow exception" recognized in Adams. In Gray v. Citizens Bank of Washington, for example, the court "[c]onclud[ed] under [prior] decisions that a division of the court is not free to expand the Adams exception" and thus affirmed the dismissal of a complaint by a plaintiff bank official who was fired after reporting to a senior official on numerous occasions evidence of possible illegal conduct by another managerial employee related to bank operations. 602 A.2d 1096, 1096-97 (D.C. 1992), overruled by Carl v. Children's Hosp., 702 A.2d 159, 160 (D.C. 1997) (en banc) ("There is nothing in the Adams opinion that bars this court — either a three-judge panel or the court en banc — from recognizing some other public policy exception when circumstances warrant such recognition. On this point a majority of the en banc court agrees. To the extent that Gray v. Citizens Bank holds differently, it is overruled."). In Thigpen v. Greenpeace, Inc., the court similarly affirmed the dismissal of a complaint by a plaintiff payroll clerk who had discovered his employer's violation of D.C. minimum wage laws, notified two superiors of violations, filed a complaint after no action was taken, and was discharged. 657 A.2d 770, 771 (D.C. 1995). The court explained that the Adams "exception requires an outright refusal to violate a specific law, with the employer putting the employee to the choice of breaking the law or losing his job." Id. And in Washington v. Guest Services., Inc., the court affirmed summary judgment in favor of employer, albeit only preliminarily, based upon the trial court's conclusion that the employer had not put the plaintiff dietary aide and cook at a retirement home, who had alleged that she had been wrongfully discharged in retaliation for attempting to ensure compliance by a fellow employee with D.C. health a food regulations, "to the choice of disobeying [her obligation not to prepare or serve unfit food] as the price for keeping her job." 703 A.2d 646, 646 (D.C. 1997) (per curiam).*fn4

Despite its initial resistance to expansion of the public policy exception to the at-will doctrine, however, the court eventually clarified in Carl that "the "very narrow exception' created in Adams should not be read in a manner that makes it impossible to recognize any additional public policy exceptions to the at-will doctrine that may warrant recognition." 702 A.2d at 160. The plaintiff in Carl, a part-time nurse, alleged that she had been wrongfully discharged because she had advocated for patients' rights and against her employer's interests both before the Council of the District of Columbia and in court as an expert witness for plaintiffs in medical malpractice cases. Id. She relied principally upon the policy embodied by D.C.Code § 1-224 (1992), which made it a criminal offense "to corruptly or by threat of force, or by any threatening letter or communication, endeavor[] to influence, intimidate, or impede any witness in any proceeding pending before the Council." D.C.Code § 1-224 (1992), quoted in, Carl, 702 A.2d at 160 n. 2. She did not claim that her former employer had threatened her or otherwise violated section 1-224 or that the statute created a private right of action, but rather, that her termination was actionable as a public policy exception to the at-will doctrine. A division of the D.C. Court of Appeals affirmed the trial court's denial of relief because of the court's prior cases. Carl, 702 A.2d at 159. But the court granted the plaintiffs petition for rehearing en banc "to consider her contention that the narrow public policy exception to the employment-at-will doctrine first recognized in [Adams] should be expanded to include the rights of employees to speak out publicly on issues affecting the public interest without fear of retaliation by their employers." Id. A majority of the en banc court held that Adams did "not foreclose any additional "public policy' exceptions to the general rule that employment contract are always at will unless they expressly-provide otherwise," id., and that the complaint stated a claim upon which relief could be granted because it fell within a public policy "solidly based" on, or "firmly anchored" in, section 1-224, id. at 163-64 & n. 6 (Terry, J., concurring); see Washington, 718 A.2d at 1080. The court, through a concurring opinion penned by Judge Terry,*fn5 articulated the following standard for the appropriate case-by-case analysis for recognizing additional public policy exceptions under Carl:

Future requests to recognize such exceptions, therefore, should be addressed only on a case-by-case basis. This court should consider seriously only those arguments that reflect a clear mandate of public policy — i.e., those that make a clear showing, based on some identifiable policy that has been "officially declared" in a statute or municipal regulation, or in the Constitution, that a new exception is needed. Furthermore, there must be a close fit between the policy thus declared and the conduct at issue in the allegedly wrongful termination.

Carl, 702 A.2d at 164 (Terry, J., concurring) (footnotes omitted); see Fingerhut v. Children's Nat'l Med. Ctr., 738 A.2d 799, 803 (D.C. 1999). Clarifying the required relationship between the particular public policy at issue and the statute or regulation from which it should be derived, the court further cautioned that "lest we allow "public policy' exceptions to swallow up the at-will doctrine . . . the recognition of any such exception must be firmly anchored either in the Constitution or in a statute or regulation which clearly reflects the particular "public policy' being relied upon." Carl, 702 A.2d at 162 (Terry, J., concurring); see Fingerhut, 738 A.2d at 803 n. 7.*fn6

The court then held that Carl could be retroactively applied to the plaintiffs complaint in Washington v. Guest Services, Inc. 718 A.2d 1071, 1072, 1074-80 (1998). As discussed above, the plaintiff in Washington was a former dietary aide and cook at a retirement home who alleged that her employment had been wrongfully terminated in retaliation for her attempts to ensure compliance by a fellow employee with D.C. health a food regulations. She proffered a sworn affidavit specifically stating that she had directed a fellow employee to stop spraying stainless steel cleaner in the area where she was cooking and that the manager who had instructed the other employee to spray the cleaner accused her of insubordination, which was the sole reason he terminated her. Id. at 1072-73. She claimed that her coworker's action of spraying the cleaning material near the food she was cooking violated various D.C. food and health regulations and that she had been terminated "for protesting safety, health, and food code violations on the part of the defendant." Id. at 1073 & n. 1 (citing 23 DCMR §§ 2101.1, 2200.2, 3010.1 (1990) and D.C.Code § 22-3416 (1996)). Despite the court's earlier preliminary affirmance of summary judgment for the employer, the court concluded after further briefing from the parties that Carl could be retroactively applied to the case, and it held under Carl that the allegations contained in the plaintiffs sworn affidavit were sufficient to survive summary judgment: "To permit an employee to be fired for such actions would undermine the purposes of the food and health regulations and would frustrate the public policy of which these regulations are an expression." Id. at 1080-81.

The court subsequently applied the Adams and Carl exceptions in Fingerhut, 738 A.2d at 799. The plaintiff there was a Director of Security for Children's National Medical Center ("CNMC") and a specially commissioned police officer under the D.C.Code.*fn7 After learning about a bribe that his employer wished to make to the D.C. Minority Business Opportunity Commission in conjunction with a construction project, the plaintiff informed a D.C. police lieutenant and the FBI. Over the course of several months, the plaintiff supplied the FBI with information for its investigation of the matter. During the same period, however, the plaintiff developed a relationship with the Vice President of Human Resources for CNMC and at one point informed the Vice President about the bribery scheme, his involvement with the FBI, and the possibility of upcoming arrests. The plaintiff was terminated shortly thereafter. Id. at 800-01. The court first concluded that it "need not decide whether Fingerhut ha[d] stated a cause of action under Adams because [it was] satisfied that his complaint state[d] a claim under Carl." Id. at 805. Construing Judge Terry's concurrence in Carl as the majority view of the en banc court, id. at 803 & n. 7, the court next applied the standards articulated therein and reasoned as follows:

We conclude that Fingerhut has made the requisite allegations under Carl. The

three statutes on which he relies, §§ 4-142, 22-704 and 4-175, in concert with § 4-114 and its implementing regulations, "reflect a clear mandate of public policy" that has been declared in statute and regulation: a policy against the termination of a special police officer who records and reports a bribe of a government official, and who assists the FBI in the investigation of corrupt influence with respect to a federal government construction grant. There is a "close fit," Carl, [ ] 702 A.2d at 164, between this policy and CNMC's alleged decision not only to terminate Fingerhut after he informed CNMC of pending arrests and his role in the investigation of the bribe, but also to fill Fingerhut's position with the Assistant Director of Security even though the stated reason for Fingerhut's termination was a reduction in ...

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.