United States District Court, D. Columbia.
[Copyrighted Material Omitted]
[Copyrighted Material Omitted]
For CRYSTAL BOONE, MELISSA HARRIS, CHARLES BARKER, HOLLY SMITH, Plaintiffs: C. Michael Tarone, LEAD ATTORNEY, Washington, DC.
For MOUNTAINMADE FOUNDATION, Defendant: Nat Peter Calamis, LEAD ATTORNEY, CARR MALONEY PC, Washington, DC.
COLLEEN KOLLAR-KOTELLY, United States District Judge.
Plaintiffs Crystal Boone, Melissa Harris, Charles Barker, and Holly Smith bring this action against their former employer, MountainMade Foundation (" MM" ), under the Civil False Claims Act (" FCA" ), 31 U.S.C. § 3729, et seq., and state law. Plaintiffs assert two claims against Defendant: (1) MM violated the " whistleblower" provisions of the FCA; and (2) MM violated public policy under West Virginia state law by wrongfully discharging Plaintiffs. Currently before the Court is Defendant's  Motion for Summary Judgment and Plaintiffs'  Motion to File Surreply to Defendant's Reply Brief. Upon consideration of the pleadings, the relevant legal authorities, and the record as a whole, the Court GRANTS IN PART and DENIES IN PART Defendant's  Motion for Summary Judgment, and GRANTS Plaintiffs'  Motion to File Surreply for the reasons stated herein.
The Court denies summary judgment as to Plaintiff Boone's alleged demotion under the FCA, but grants summary judgment as to Plaintiff Boone's alleged constructive discharge under both the FCA and state law. The Court denies summary judgment
as to Plaintiff Barker's alleged demotion under the FCA, but grants summary judgment as to Plaintiff Barker's termination from employment under the FCA and state law. Similarly, the Court denies summary judgment as to Plaintiff Smith's alleged demotion under the FCA, but grants summary judgment as to Plaintiff Smith's termination from employment under the FCA and state law. Finally, the Court denies summary judgment as to Plaintiff Harris's alleged constructive discharge under both the FCA and state law, but grants summary judgment as to Plaintiff Harris's alleged demotion under the FCA.
Accordingly, the Plaintiffs' claims related to the alleged demotions of Plaintiffs Boone, Barker, and Smith under the FCA as well as the alleged constructive discharge of Plaintiff Harris under both the FCA and state law survive Defendant's Motion for Summary Judgment.
A. Scope of this Action
Defendant MM is a nonprofit organization that received the majority of its funding from inception through 2006 from federal government grants from the Small Business Administration (" SBA" ). Def.'s Stmt. ¶ 3. In March 2006, Plaintiffs, four MM employees, raised concerns to the MM Board of Directors about MM Executive Director Kate McComas. Id. ¶ ¶ 13-20. Among other things, Plaintiffs asserted that Ms. McComas was using the MM debit card for personal expenditures. Id. ¶ ¶ 16-17. As a result, Ms. McComas was asked to reimburse MM for some purchases made on the debit card. Def.'s Stmt. ¶ 23; Pl.'s Controv. Stmt. ¶ 21.
Plaintiffs commenced this action on June 20, 2008, claiming that after making the disclosures to the board, subsequent actions taken by MM, including Plaintiffs' alleged demotions and discharges, were made in retaliation for their whistleblowing activities in violation of 31 U.S.C. § 3730(h). See Compl., ECF No. ; 2d Amend. Compl., ECF No. . Plaintiffs further assert that they were wrongfully discharged in violation of public policy under West Virginia state law. Defendant argues that Plaintiffs have failed to establish that their reports to the board put them within the purview of 31 U.S.C. § 3730(h) or, in the alternative, that they were subject to adverse job actions in retaliation for their reports to the board.
Defendant also argues that Plaintiffs failed to make out a claim for wrongful discharge in violation of public policy.
B. Procedural History
On June 20, 2008, Plaintiffs filed suit against Defendant in this Court. Defendant filed its Motion to Dismiss, or in the Alternative, a Motion for Summary Judgment on August 22, 2008, contending that Plaintiffs failed to state a claim for which relief could be granted. Judge Ricardo M. Urbina agreed and granted Defendant's Motion by an Order entered on February 15, 2010. See Boone v. Mountainmade Found., Inc. ( Boone I ), 684 F.Supp.2d 1 (D.D.C. 2010). On March 12, 2010, Plaintiffs filed a Motion to Alter or Amend Judgment or In the Alternative, For Leave of Court to File Second Amended Complaint. Judge Urbina granted Plaintiffs' request to amend the complaint by Memorandum Order entered on April 7, 2011, and Plaintiffs' Second Amended Complaint was filed that same day. On May 5, 2011, Defendant filed a Motion to Dismiss Count II of Plaintiffs' Second Amended Complaint, arguing that Plaintiffs failed to state a claim for wrongful discharge in violation of public policy. This Court denied Defendant's Motion by an Order entered on April 30, 2012. See Boone v. Mountainmade Found., Inc. ( Boone II ), 857 F.Supp.2d 111 (D.D.C. 2012).
Defendant subsequently filed the instant Motion for Summary Judgment. See Def.'s Mot., ECF No. . Defendant argues that Plaintiffs failed to establish claims for retaliation in violation of the FCA because Plaintiffs have not provided sufficient evidence to demonstrate that they were engaged in protected activity. Defendants also argue that Plaintiffs were not demoted or constructively terminated and, accordingly, were not subject to adverse employment actions. In the two instances in which Plaintiffs were terminated from employment, Defendant argues that Plaintiffs have not demonstrated that these acts were done in retaliation for the reports to the board. Finally, Defendant contends that Plaintiffs cannot demonstrate that they were subject to wrongful discharge in violation of public policy as a matter of law because this claim was premised on the alleged violation of the retaliation provision of the FCA.
Plaintiffs filed an Opposition to Defendant's Motion. See Pls.' Opp'n, ECF No. . The Court notes that Plaintiffs attached reams of exhibits to their opposition, totaling well over 2,000 pages and including entire deposition transcripts. See ECF. Nos. , -, -, -. Many of the exhibits were mismarked and often the Court was required to search through the entire set of exhibits to locate the referenced document. In Plaintiffs' Controverted Statement of Material Facts and Plaintiffs' Statement of Material Facts, Plaintiffs respond to 34 of the 36 facts cited in Defendant's Statement of Facts and then present additional facts numbered 1 through 442, many of which are largely irrelevant and not cited to the proper authority within the voluminous exhibits. See generally Pls.' Controv.
Stmt., at ECF No. [74-1]; Pls.' Stmt., ECF No. [74-1]. Despite filing two errata, Plaintiffs failed to correct the mistakes in the original filings. See Pls.' 1st Errata to Opp'n, ECF No. ; Pls. 2d Errata to Opp'n, ECF No. . In addition, Plaintiffs at time identify facts in their pleadings that are not presented in either their Controverted Statement of Material Facts or their statement citing 442 additional material facts. Further, Plaintiffs have failed to provide several exhibits cited as support to their material facts, thus, providing no evidentiary basis for their assertions.
Pursuant to Local Rule 7(h), a party filing a motion for summary judgment must include a statement of material facts as to which that party contends there is no genuine issue. An opposition to a motion for summary judgment must include " a separate concise statement of genuine issues setting forth all material facts as to which it is contended there exists a genuine issue necessary to be litigated, which shall include references to the parts of the record relied on to support the statement." LCvR 7(h) (emphasis added). The D.C. Circuit has explained:
[A] district court judge should not be obliged to sift through hundreds of pages of depositions, affidavits, and interrogatories in order to make his own analysis and determination of what may, or may not, be a genuine issue of material disputed fact. In this respect, a district court may legitimately look to and rely upon counsel to identify the pertinent parts of the record, to isolate the facts that are deemed to be material, and to distinguish those facts which are disputed from those that are undisputed.
Twist v. Meese, 854 F.2d 1421, 1425, 272 U.S.App.D.C. 204 (D.C. Cir. 1988). Indeed, " our district courts' Local Civil Rule 7(h) expressly authorizes courts to treat as forfeited evidence--including record evidence--that the parties fail to highlight at summary judgment . . . . The existence of a genuine dispute of material fact, therefore, ordinarily turns not on a review of the entire record, but rather on the 'facts' and the portions of the record each party specifically highlights." Estate of Parsons v. Palestinian Auth., 651 F.3d 118, 136-37, 397 U.S.App.D.C. 236 (D.C. Cir. 2011). In an exercise of its discretion, the Court shall only consider material facts that are set out in the Defendant's Statement of Material Facts Not In Genuine Dispute, Plaintiffs' Controverted Statement of Material Facts, or Plaintiffs' Statement of Material Facts, and that are cited to and supported by exhibits filed with the Court. Fed.R.Civ.P. 56(c) & (e)(2) (" If a party fails to properly support an assertion of fact or fails to properly address another party's assertion of fact . . ., the court may consider the fact undisputed for the purposes of the motion." ). The Court shall not rely on material facts raised only in the parties' pleadings, and not in their statements of material facts. Jackson v. Finnegan, Henderson, Farabow, Garrett & Dunner, 101 F.3d 145, 150-51, 322 U.S.App.D.C. 35 (D.C. Cir. 1996) (noting that the Court may require strict compliance with the predecessor rule to LCvR 7(h), which " places the burden on the parties and their counsel, who are most familiar with the litigation and the record, to crystallize for the district court the material facts and relevant portions of the record" ).
Defendant, through a footnote in its reply, requests that the Court enter a protective order to relieve Defendant from responding to Plaintiffs' additional facts. Def.'s Reply at 2 n.1. The Court notes that the proper procedure for obtaining a protective order is through the filing of a separate motion, not through placing the request in a footnote within the reply. However, Defendant's reply rests on legal rather than factual arguments in support
of its motion. See generally Def.'s Reply (arguing that Plaintiffs did not provide evidence to establish that they were engaged in " protected activity" or subject to " adverse employment actions" within the meaning of the statute and case law). Accordingly, the Court shall not require Defendant to respond to Plaintiffs' Statement of Material Facts.
Given that the filings are a far cry from a model of clarity, the Court shall address the issues raised by the parties in their statements of material facts that are properly cited to the record and supported by the cited material. To the extent that this affects the outcome of the pending motion, the fault and accountability must rest with the parties. In instances where the Court has been unable to locate a document or evidence is cited incorrectly, this information shall be noted in a footnote.
II. LEGAL STANDARD
Summary judgment is appropriate where " the movant shows that there is no genuine dispute as to any material fact and [that he] . . . is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(a). The mere existence of some factual dispute is insufficient on its own to bar summary judgment; the dispute must pertain to a " material" fact. Id. Accordingly, " [o]nly disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). Nor may summary judgment be avoided based on just any disagreement as to the relevant facts; the dispute must be " genuine," meaning that there must be sufficient admissible evidence for a reasonable trier of fact to find for the non-movant. Id.
In order to establish that a fact is or cannot be genuinely disputed, a party must (a) cite to specific parts of the record--including deposition testimony, documentary evidence, affidavits or declarations, or other competent evidence--in support of his position, or (b) demonstrate that the materials relied upon by the opposing party do not actually establish the absence or presence of a genuine dispute. Fed.R.Civ.P. 56(c)(1). Conclusory assertions offered without any factual basis in the record cannot create a genuine dispute sufficient to survive summary judgment. Ass'n of Flight Attendants-CWA, AFL-CIO v. U.S. Dep't of Transp., 564 F.3d 462, 465-66, 385 U.S.App.D.C. 347 (D.C. Cir. 2009). Moreover, where " a party fails to properly support an assertion of fact or fails to properly address another party's assertion of fact," the district court may " consider the fact undisputed for purposes of the motion." Fed.R.Civ.P. 56(e).
When faced with a motion for summary judgment, the district court may not make credibility determinations or weigh the evidence; instead, the evidence must be analyzed in the light most favorable to the non-movant, with all justifiable inferences drawn in his favor. Liberty Lobby, 477 U.S. at 255. If material facts are genuinely in dispute, or undisputed facts are susceptible to divergent yet justifiable inferences, summary judgment is inappropriate. Moore v. Hartman, 571 F.3d 62, 66, 387 U.S.App.D.C. 62 (D.C. Cir. 2009). In the end, the district court's task is to determine " whether the evidence presents a sufficient disagreement to require submission to [the trier of fact] or whether it is so one-sided that one party must prevail as a matter of law." Liberty Lobby, 477 U.S. at 251-52. In this regard, the non-movant must " do more than simply show that there is some metaphysical doubt as to the material facts," Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 586, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986);
" [i]f the evidence is merely colorable, or is not sufficiently probative, summary judgment may be granted." Liberty Lobby, 477 U.S. at 249-50 (citations omitted).
The FCA imposes civil penalties against a person who " knowingly presents, or causes to be presented, to an officer or employee of the United States Government . . . a false or fraudulent claim for payment or approval," or " knowingly makes, uses, or causes to be made or used, a false record or statement to get a false or fraudulent claim paid or approved by the Government." See 31 U.S.C. § 3729(a)(1)-(2) (repealed 2009). Section 3730(h) of the FCA was enacted to provide legal protection from retaliatory acts for those who may be considering exposing fraud. United States ex rel. Yesudian v. Howard Univ., 153 F.3d 731, 736, 332 U.S.App.D.C. 56 (D.C. Cir. 1998) (quoting S. Rep. No. 99-345, at 35, reprinted in 1986 U.S.C.C.A.N. at 5300). Section 3730(h), at the relevant time period, provided:
Any employee who is discharged, demoted, suspended, threatened, harassed, or in any other manner discriminated against in the terms and conditions of employment by his or her employer because of lawful acts done by the employee on behalf of the employee or others in furtherance of an action under this section, including investigation for, initiation of, testimony for, or assistance in an action filed or to be filed under this section, shall be entitled to all relief necessary to make the employee whole . . . .
31 U.S.C. § 3730(h) (repealed 2009).
There are two basic elements to a claim under this section: (1) " acts by the employee 'in furtherance of' a suit under § 3730 -- acts also known as 'protected activity'" ; and (2) " retaliation by the employer against the employee 'because of' those acts.'" United States ex rel. Schweizer v. Océ N.V.., 677 F.3d 1228, 1237, 400 U.S.App.D.C. 284 (D.C. Cir. 2012). The second element of the claim, known more commonly as the causation question, is further divided into two inquiries: " (1) did 'the employer ha[ve] knowledge the employee was engaged in protected activity'; and (2) was the employer's adverse action against the employee 'motivated, at least in part, by the employee's engaging in [that] protected activity.'"  Id. at 1237-38 (quoting United States ex rel. Yesudian, 153 F.3d at 736).
The McDonnell Douglas burden-shifting framework applies to retaliation claims at the summary judgment stage. Schweizer, 677 F.3d at 1241. As the D.C. Circuit explained:
Under McDonnell Douglas, an employee first must make out a prima facie case of retaliation by showing '(1) that he engaged in statutorily protected activity; (2) that he suffered a materially adverse action by his employer; and (3) that a causal link connects the two.' If the employee does so, then the burden shifts to the employer to 'produce admissible evidence that, if believed, would establish that [its] action was motivated by a legitimate, nondiscriminatory reason.' Once that occurs, 'the burden-shifting framework disappears, and a court reviewing summary judgment looks to whether a reasonable jury could infer . . . retaliation from all the evidence.'
Id. at 1240-41 (internal citations omitted).
A. Protected Activity
The Court first turns to the issue of whether Plaintiffs engaged in a protected
activity by making reports to the MM board regarding Ms. McComas's actions. In order to come within the protection of section 3730(h), " 'it is sufficient that a plaintiff be investigating matters that 'reasonably could lead' to a viable False Claims Act case.'" United States v. Am. Nat'l Red Cross (Hoyte ex rel. United States), 518 F.3d 61, 66, 380 U.S.App.D.C. 185 (D.C. Cir. 2008) (quoting Yesudian, 153 F.3d at 740). Plaintiffs' mere dissatisfaction with their treatment on the job is not enough to demonstrate that they were engaged in protected activity. Yesudian, 153 F.3d at 740. " Nor is an employee's investigation of nothing more than his employer's non-compliance with federal or state regulations." Id. Instead, " [t]o be covered by the False Claims Act, the plaintiff's investigation must concern 'false or fraudulent' claims." Id. " Determining whether an employee has engaged in protected conduct under the FCA is a 'fact specific inquiry." " Shekoyan v. Sibley Int'l, 409 F.3d 414, 423, 366 U.S.App.D.C. 144 (D.C. Cir. 2005) (quoting Hutchins v. Wilentz, Goldman & Spitzer, 253 F.3d 176, 187 (3d Cir. 2001)).
Plaintiffs are not, however, required to actually know that the investigation they are pursuing could result in a FCA suit and, accordingly, Plaintiffs are not required to alert Defendant of the prospect of a FCA suit. United States ex rel. Schweizer v. Océ N.V., 677 F.3d 1228, 1237 (D.C. Cir. 2012). Rather, the requirement is only that acts be done in furtherance of a FCA action and " even an investigation conducted without contemplation of--or knowledge of the legal possibility--a False Claims Act suit can end up being 'in furtherance' of such an action." Yesudian, 153 F.3d at 741. As the D.C. Circuit reasoned, to require Plaintiffs to have specific knowledge that their investigation would give rise to a FCA suit would limit protection from retaliation only to lawyers or those versed in the law. Id.
Plaintiffs present the following account of the events leading up to their disclosures regarding Ms. McComas, MM's Executive Director, to the MM board. Plaintiffs, after realizing they each had information about Ms. McComas, met several times in February and March 2006 to discuss their individual experiences. Pls.' Stmt. ¶ ¶ 87-88 (citing Pls.' Ex. 208 at 69, 83, ECF No. [79-3] (Smith Dep., Vol. I)). In particular, Plaintiffs believed that Ms. McComas was using MM's debit card for personal expenditures, that she did not work her required hours, that she misrepresented her hours worked on her timesheet, and that she used the MM vehicle for personal use and did not properly log mileage. Plaintiffs also addressed other issues regarding Ms. McComas's lack of leadership and management skills. See Pls.' Stmt. ¶ ¶ 110-125 (citing Pls.' Ex. 5, ECF No. [74-2] (Letter from Barker to MM board); Pls.' Ex. 23, ECF No. [74-11] (Letter from Harris to MM board); Pls.' Ex. 24, ECF No. [74-12] (Letter from Smith to MM board); Pls.' Ex. 53, ECF No. [87-8] (Letter from Boone to MM board)).
In early March 2006, Plaintiff Boone disclosed the group's concerns about Ms. McComas to Bill Phillips, MM's CPA at Toothman & Rice, who in turn consulted with another partner at his firm. Pls.' Stmt. ¶ ¶ 90-91 (citing Pls.' Ex. 200 at 97, 104, ECF No. [78-1] (Boone Dep., Vol. I)). Mr. Phillips informed Ms. Boone that if she did not take the concerns regarding
Ms. McComas to the MM Board of Directors, that she could be held criminally liable. Id. Plaintiffs then decided that Ms. Boone would raise their concerns to Dale McBride, an MM board member. Pls.' Stmt. ¶ 92 (citing Pls.' Ex. 200 at 101-02, ECF No. [87-1] (Boone Dep., Vol. I)). After speaking with Ms. Boone, Mr. McBride notified Jack Carpenter, chairman of the MM board, and Peter Wolk, MM's legal counsel, of the allegations and they in turn spoke with Ms. Boone. Pls.' Stmt. ¶ ¶ 93-94 (citing Pls.' Ex. 167 ¶ ¶ 7-9, ECF No. [87-7] (Boone Declaration); Pls.' Ex. 200 at 104, ECF No. [87-1] (Boone Dep., Vol. I)). Ms. Boone was told that the issue would be addressed at the next MM board meeting. Mr. Carpenter told Ms. Boone that other employees with concerns about Ms. McComas could submit letters to the MM board. Def.'s Stmt. ¶ 14; Pls.' Controv. Stmt. ¶ 14. All four Plaintiffs submitted letters to the MM board, each dated March 17, 2006, and Ms. Boone also submitted a spreadsheet to the MM board detailing debit card charges, totaling $14,353.80, that she believed to be personal charges incurred by Ms. McComas. Def.'s Stmt. ¶ ¶ 15, 20; Pls.' Controv. Stmt. ¶ ¶ 15, 19 (citing Pls.' Ex. 5, ECF No. [74-2] (Letter from Barker to MM board); Pls.' Ex. 23, ECF No. [74-11] (Letter from Harris to MM board); Pls.' Ex. 24, ECF No. [74-12] (Letter from Smith to MM board); Pls.' Ex. 53, ECF ...