Sunday, July 26, 2009

WHISTLEBLOWERS BEWARE: State of Texas and TxDOT v. Lueck (Tex 2009)


Three ways to skin the whistleblower: 1. summary judgment; 2. special exceptions, and now, for good measure, culling tool no. 3: DISMISSAL ON THE PLEADINGS


OPEN SEASON ON WHISTLE BLOWERS

Regulatory Noncompliance Not Illegal, Supreme Court says (at least not when it comes to defeating whistleblower suits brought by terminated public employees)

Lawsuits by public employees in employment-related disputes, such as wrongful termination or discrimination, are usually responded to with motions for summary judgment or with special exceptions if the pleadings are arguably insufficient or otherwise defective. In its recent decision in State of Texas v. Lueck, the Texas Supreme Court approved a third method: Dismissal on the pleadings. Adding to its nearly spotless record of decisions favorable to governmental defendants, the Court gave its seal of approval to dismissal on the pleadings in a wrongful discharge suit brought under the Texas Whistleblower statute by an employee fired by TxDOT. The Act provides a statutory cause of action for public employees retaliated against for reporting illegal activity at work. Finding lack of jurisdiction -- one of the Court's favorite disposal doctrines -- the Court dismisses the whistleblower's suit outright without remand to the lower court. No opportunity to replead necessary.

It would be futile anyway.

For good measure, and although not necessary to kill the lawsuit at hand, the Court held that two necessary elements were not satisfied by the plaintiff's pleadings in this case, and thus warranted jurisdictional dismissal: (1) the recipient of the plaintiff's report of allegedly illegal activity was not a proper law enforcement authority, and (2) the complaint was not really about illegal acts, but merely “regulatory noncompliance,” as if administrative law weren't really law.

Two birds killed with one opinion. Two defenses to whistleblower claims beefed up and stamped with the court's seal of approval, and a new method to swiftly dispatch whistleblower suits without delving into evidence. Three new precedents handed to the defense bar for the price of one (appeal).

The basic thrust of the High Court's whistleblower jurisprudence matches the Court's commitment to quash tort claims against public entity defendants under the Texas Tort Claims Act: Such suits should not be brought in the first place, much less should the plaintiffs claims be vindicated. Plaintiffs claiming whistleblower protection, after all, create inconvenience to government officials and seek to impose liability on governmental defendants, a favored category of litigants at the High Court.

Such suits should be dismissed if at all possible. The earlier the better.

Indeed, the Supreme Court is seeing to it.

This latest installment in the Court's strings of pro-government and anti-employee rulings not only narrows the scope of the legislated immunity waiver effected by the Whistleblower Act, but also approves the summary disposition of whistleblower claims without even the need for a summary judgment motion to test the strength of the evidence.

Under the newly fashioned precedent, a plea to the jurisdiction will do. And lest the Plaintiff amend the pleadings to meet the Court's tightened standards of what constitutes a qualifying claim entailing protection against and a remedy for adverse employment actions, the Court also blesses denial of any opportunity to replead. The claim could not succeed anyhow, the Court opines. The Court no doubt is right. A favorable verdict and judgment for a whistleblower would surely not withstand Supreme Court review, whatever the rationale that might be offered to effect reversal.

But better still if whistleblowers' rants of retaliation do not go to a potentially sympathetic jury in the first instance. Safer to quash a whistleblower suit at its inception, and to deter others brazen enough to invoke the Act. The latest opinion promises to accomplish as much.

WOULD-BE WHISTLEBLOWERS BEWARE!

The Lueck opinion fits in neatly with the Texas Supreme Court's immunity jurisprudence. Immunity theories are indeed an awesome weapon in the arsenal of the defense. No wonder the Court is so fond of them. If immunity is established, the evidence does not matter. The merits become irrelevant. Pesky plaintiffs can be thrown out of the courthouse without much ado, not to mention the inconvenience of a trial to determine whether the allegations in the pleadings are supported by the facts. Judicial resources can thus be preserved. This has been a principal concern of the Court, an interest the Court has shown a deep commitment to vindicate. Time and again. At the expense of the plaintiff's constitutionally guaranteed right to access to the courts.

The court's opinion was authored by Justice Paul Green. Not a single member of the Court dissented. On an earlier occasion, it was the Chief himself who took the lead in weakening whistleblower protections. Jefferson authored the opinion in which the Court gave the nod of approval for petty retaliation by government managers in holding that the punishment complained of in that case fell short of discharge or demotion and did not rise to the level of an actionable adverse employment action under the Whistleblower Act. Montgomery County v. Park, 246 S.46 S.W.3d 610 (Tex. 2007). In that case, the Chief set the tone. Lueck marks a further step to erode the Whistleblower Act, and the notion that it affords a viable remedy, and thus undermines its purpose.

EXCERPTS FROM THE TEXAS SUPREME COURT'S ANTI-WHISTLEBLOWER OPINION IN STATE V. LUECK (TEX. 2009):

Under the Texas Whistleblower Act, sovereign immunity is waived when a public employee alleges a violation of Chapter 554 of the Government Code. TEX. GOV’T CODE § 554.0035. A violation under Chapter 554 occurs when a governmental entity retaliates against a public employee for making a good-faith report of a violation of law to an appropriate law enforcement authority. Id. § 554.002(a). George Lueck was fired from the Texas Department of Transportation (TxDOT) after he sent an e-mail to the director of the Transportation Planning and Programming Division, reporting what he believed to be violations of state and federal law. Lueck then sued the State of Texas and TxDOT under the Whistleblower Act, alleging that he “was fired because of his good faith reports of TxDOT’s violation of state and federal law.”

We hold that, because Lueck’s e-mail report only warned of regulatory non-compliance, not a violation of law, and because an agency supervisor is not an appropriate law enforcement authority to whom a report should be made, Lueck’s allegation affirmatively negates the court’s subject-matter jurisdiction over the cause. The State’s sovereign immunity is not waived, and thus, we reverse the court of appeals’ judgment and dismiss the case for lack of subject-matter jurisdiction.

* * *

TxDOT points to uncontroverted allegations within Lueck’s pleadings, claiming that they affirmatively negate jurisdiction because the e-mail sent to Randall did not report a violation of law to an appropriate law enforcement authority. As for the report element, Lueck’s pleadings affirmatively negate the existence of a reported violation. Lueck’s fifth amended petition states that Lueck “believed and reported in good faith that if the Department did not pursue an immediate and positive resolution to Cooper’s October 29, demand[,] the Department would violate federal and state law by failing to remedy non-compliance with the federal and state reporting requirements.” This allegation merely recites Lueck’s prediction of possible regulatory noncompliance. Such a regulatory non-compliance of this kind does not equate to a violation of law under which a law enforcement authority regulates or enforces within the meaning of the Whistleblower Act. See TEX. GOV’T. CODE § 554.002(b). Further, Lueck attached the e-mail report to his pleadings, and the only discernable violation in the report itself states that TxDOT’s current system for reporting traffic data “is not capable of handling this data and will, therefore, never be in compliance.” This references the violation reported in the 1995 Federal Highway Administration report, which is only intended to call TxDOT’s attention to a previous, publicly-known instance of regulatory non-compliance. At most, this reference to a previous violation of a federal standard expresses disagreement with remedial measures taken by TxDOT after it was already knowingly out of compliance. An internal policy recommendation of this kind is not a report of a violation of law that the Whistleblower Act was designed to protect. Even if this e-mail did report a violation of law, Lueck’s supervisor, Mr. Randall, is not an appropriate law enforcement authority to whom such a report should be made.

* * *

[A]s a matter of law, Lueck’s pleadings affirmatively demonstrate that he did not allege a violation under the Whistleblower Act.3 For these reasons, we reverse the court of appeals’ judgment and dismiss the cause for lack of subject-matter jurisdiction.


CASE STYLE AND DETAILS & LINKS: State of Texas and TxDoT v. Lueck, No. 06-1034 (Tex. Jun. 26, 2009)(Green)(Whistleblower Act claim dismissed)(allegation of regulatory noncompliance insufficient, report not to proper law-enforcement agency)
THE STATE OF TEXAS AND THE TEXAS DEPARTMENT OF TRANSPORTATION v. GEORGE LUECK;
from Travis County; 3rd district (
03-05-00510-CV, 212 SW3d 630, 08-16-06) motion to dismiss denied
The Court reverses the court of appeals' judgment and dismisses the case for lack of jurisdiction.
Justice
Green delivered the opinion of the Court. [pdf 16 pgs.]
View
Electronic Briefs in State of Texas and TxDoT v. Lueck (Tex 2009)

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