Smith v. Caterpillar, Inc. ( 2008 )

NOT RECOMMENDED FOR FULL-TEXT PUBLICATION
File Name: 08a0774n.06
Filed: December 19, 2008
No. 07-5312
United States Court of Appeals
for the sixth circuit
VERNON G. SMITH, *
*
Plaintiff - Appellant, *
* Appeal from the United States
v. * District Court for the Eastern
* District of Kentucky.
CATERPILLAR, INC.; RON *
GRIFFIN; ALAN SHEPHERD; *
KEN HARTWIG, *
*
Defendants - Appellees. *
Before KEITH, GRIFFIN, and JOHN R. GIBSON,* Circuit Judges.
JOHN R. GIBSON, Circuit Judge.
Vernon Greg Smith appeals from the district court’s grant of summary judgment against him
and in favor of Caterpillar, Inc. Smith contends that he was wrongfully discharged from an implied
employment contract with Caterpillar after he threatened to report potential safety issues to the
Federal Occupational Safety and Health Administration. He further alleges that Caterpillar breached
his implied employment contract and that Caterpillar and its employees tortiously interfered with his
employment. Finally, he asserts that the district court erred in denying his motion to amend his
complaint and that the district court judge was biased against him. We affirm.
I.
*
The Honorable John R. Gibson, United States Circuit Judge for the Eighth Circuit Court of
Appeals, sitting by designation.
Smith was employed as a maintenance technician at the Danville branch of Caterpillar, Inc.
from March 22, 1999 until September 19, 2000. Caterpillar’s plant uses a “heat treat line” to harden
metallic parts. A fault card in the computer monitors the heat treat line. If it senses a mechanical
problem, it automatically stops the line. In early 2000, Smith claimed that a short in the wire
connecting the heat line to the computer caused the heat line to repeatedly stop when no fault
actually existed. Smith’s supervisor Douglas and another maintenance technician worked on the
problem, but they resolved the problem by disconnecting the fault card and not solving the
underlying issue.
Smith approached Douglas with technical diagrams showing that the heat treat line was a
safety hazard, but Douglas stated that he had investigated the issue and disagreed with Smith’s
assessment. Smith spoke to Greg Rziplinksi, Douglas’s supervisor, about the issue but came away
equally dissatisfied. Several weeks later, Smith told his fellow employee Jeff Lamb that if
Caterpillar did not fix the problem, he would call OSHA about repairing it. The day after, Smith met
with Ron Griffith, the plant manager, who told him that he did not believe the disconnected card was
a problem. Nevertheless, Griffith sought the advice of an electrical engineer, Aaron Kinney, who,
after reviewing the wiring diagrams, thought that the fault card could be a problem. Griffith directed
maintenance to address the issue in a way that kept the fault card connected to the heat treat line.
Smith alleges that around this time, he began receiving negative performance reviews from
Douglas and that Allen Shepherd, the operations manager, began to inquire about his job
performance. On September 15, 2000, Shepherd conducted a “turnover meeting,” which is held at
the end of each shift to allow the outgoing technicians to inform the incoming technician about the
status of repairs and further work that needs to be done in the following shift. During the meeting,
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Shepherd asked Smith what machines he had serviced that evening, to which Smith named some of
the machines but then paused, prompting Shepherd to ask what other machines he had worked on.
Smith replied that he had worked on an accumulator. Shepherd asked which one and, in frustration,
cursed at Smith. Shepherd informed Smith that he was disappointed with his lack of preparation for
the turnover meeting.
After the meeting, Smith told Shepherd that he had no right to talk to him the way he did, to
which Shepherd reiterated his expectation that Smith should know which machines he repaired
during his shift. Shepherd asked Smith if he understood these expectations, and Smith did not
respond. Shepherd told Smith that he would be fired immediately if he did not respond. Smith
replied that he could fire him if he so desired. Shepherd did not fire him but reported the incident
to Ken Hartwig, Danville plant’s human resources manager at the time.
The next day, Hartwig prepared a written warning documenting the incident and asked Lamb
to bring Smith to his office. Smith claims that Lamb told him that he would be fired if he did not
quit. Smith met with Hartwig and Lamb in Hartwig’s office. Hartwig told Smith that he needed to
sign the document, indicating that he had received a written warning. Smith refused, and contends
that Hartwig told him that he would be fired if he did not sign the warning. Smith refused to sign
the warning. Hartwig claims that Smith quit; Smith maintains that he was fired. Smith signed an
agreement to return any Caterpillar property within his possession and left the building.
II.
We review de novo a district court’s grant of summary judgment. Hamilton v. Starcom
Mediavest Group, Inc., 522 F.3d 623, 627 (6th Cir. 2008). Summary judgment is properly granted
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where no genuine issue of material fact exists and the moving party is entitled to judgment as a
matter of law. Id.
A. Wrongful Termination.
Under Kentucky law, an employment relationship is generally terminable at will. Firestone
Textile Co. Div. v. Meadows, 666 S.W.2d 730, 731 (Ky. 1983). This means that “[a]n employer may
discharge his at-will employee for good cause, for no cause, or for a cause that some might view as
morally indefensible.” Id. However, an employee can state a claim for wrongful discharge if his
termination “is contrary to a fundamental and well-defined public policy as evidenced by existing
law . . . .” Id. (quoting Brockmeyer v. Dun & Bradstreet, 335 N.W.2d 834, 835 (Wis. 1983)).
Smith contends that he was wrongfully discharged because Caterpillar fired him for
threatening to call OSHA. Smith failed to specify which well-defined public policy his purported
discharge would violate, although during his deposition, he specified the federal OSHA statute. As
the district court recognized, both the federal OSHA statute, 29 U.S.C. § 660(c), and the Kentucky
OSHA statute, Ky. Rev. Stat. Ann. § 338.121(3), specify that public policy forbids firing in
retaliation for complaints filed under their respective OSHA statutes:
No person shall discharge or in any manner discriminate against any employee
because such employee has filed any complaint or instituted or caused to be instituted
any proceeding under or related to this chapter or has testified or is about to testify
in any such proceeding or because of the exercise by such employee on behalf of
himself or others of any right afforded by this chapter.
29 U.S.C. § 660(c)(1); Ky. Rev. Stat. Ann. § 338.121(3).
But under Kentucky law, the public policy rule applies only when the statute creating the
public policy does not provide a structure for pursuing a complaint under the statute. Grzyb v.
Evans, 700 S.W.2d 399, 401 (Ky. 1985). Here, both the federal OSHA statute, at 29 U.S.C.
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§ 660(c)(2), and the Kentucky OSHA statute, at Ky. Rev. Stat. Ann. § 338.121(3)(b), outline a
procedure whereby a complaint shall be filed with the Secretary of Labor or the Executive Director
of the Office of Occupational Safety and Health. “Where the statute both declares the unlawful act
and specifies the civil remedy available to the aggrieved party, the aggrieved party is limited to the
remedy provided by the statute.” Grzyb, 700 S.W.2d at 401. Therefore, Smith can state no separate
claim for wrongful discharge. Hines v. Elf Atochem N. Am., Inc., 813 F. Supp. 550, 552 (W.D. Ky.
1993) (holding that both federal and Kentucky OSHA statutes preempt wrongful discharge claims
based on OSHA).
B. Breach of Implied Contract.
Smith contends that Caterpillar breached an implied employment contract when it discharged
him from his employment. While employment for an indefinite period of time may be terminated
by either party at will, parties can modify the at-will relationship by entering into an employment
contract that is terminable only pursuant to express terms of the contract. See Shah v. Am. Synthetic
Rubber Corp., 655 S.W.2d 489, 491-93 (Ky. 1983). Here, nothing altered Smith’s at-will
employment status. Indeed, he admitted as much in the third paragraph of his complaint. (“My
employment was [] terminable at will either by the employer or the employee.”). He reiterated this
view during his deposition, though he “reserve[d] the right to add something to it later” because he
may not have understood “what’s going on.”
Smith nevertheless argues that he had an implied employment contract because he thought
that (1) Caterpillar was a good company, (2) Caterpillar was a wealthy company, and (3) he was a
good worker. None of these reasons can transform his at-will employment status into an implied
contract. There being no contract, his breach of contract claim necessarily fails.
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C. Tortious Interference.
Smith contends that Caterpillar tortiously interfered with his employment. Under Kentucky
law, tortious interference with employment requires a showing of the following elements: (1) the
existence of a contract; (2) defendant’s knowledge of the contract; (3) defendant’s intent to cause
breach; and (4) defendant’s conduct that caused the breach. Lovely v. Aubrey, 188 F.3d 508, 1999
WL 701921 at *4 (6th Cir. 1999) (unpublished) (citing CMI, Inc. v. Intoximeters, Inc., 918 F. Supp.
1068, 1079 (W.D. Ky. 1995)). Even if we assume that there was a contract between Smith and
Caterpillar, Caterpillar, as a party to an agreement, cannot tortiously interfere with the performance
of its own contract. Rawlings v. Breit, 2005 WL 1415356, at *3 (Ky. Ct. App. Jun. 17, 2005)
(unpublished). Moreover, Shepherd, Griffith, and Hartwig were acting on Caterpillar’s behalf, not
in their own interests. Smith did not point to any admissible evidence that would support a claim
that the individual defendants were acting on their own behalf. Therefore, the individual defendants
are similarly absolved from this claim. Id.
D. Denial of Motion to Amend Complaint.
We review for abuse of discretion a district court’s denial of a motion to amend the pleadings
on the ground that the motion was untimely and prejudicial. Parry v. Mohawk Motors of Mich., Inc.,
236 F.3d 299, 306 (6th Cir. 2000).
The Federal Rule in effect when the motion was decided provided that leave to amend “shall
be freely given when justice so requires.” Fed. R. Civ. P. 15(a). Nevertheless, to take advantage of
the Rule’s liberality, the party requesting leave “must act with due diligence.” Parry, 236 F.3d at
306 (quoting United States v. Midwest Suspension & Brake, 49 F.3d 1197, 1202 (6th Cir. 1995)).
Factors that may be considered in deciding whether to permit an amendment include undue delay
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in filing, lack of notice to the opposing party, bad faith by the moving party, repeated failure to cure
deficiencies by previous amendments, undue prejudice to the opposing party, and futility of
amendments. Coe v. Bell, 161 F.3d 320, 341-42 (6th Cir. 1998).
Here, all motions to amend the parties’ pleadings were due no later than April 28, 2006.
After the defendants filed their motion for summary judgment, Smith filed his second motion to
amend on November 28, 2006, alleging claims for tortious interference of a prospective advantage
and tortious interference with employment. The district court properly deemed that seven months’
delay between the last date for amendment in the scheduling order and the motion for leave to
amend, coupled with the prejudice to the defendants of reopening a case that was “essentially
closed,” justified denial of Smith’s motion to amend. See Coe, 161 F.3d at 341-43 (considering
filing motion to amend seven months after last date for amendment “substantial” and combined with
prejudice to the opposing party of filing new answers and motions—in essence re-opening the
case—justified denial of motion to amend). Moreover, the district court had already granted him one
motion to amend. There was no abuse of discretion by the district court.
E. Judicial Bias and Other Claims.
Smith claims that District Judge Coffman was biased against him because she was appointed
by President Clinton with the help of Terry McBrayer, a man who Smith claims to have sued and
who, as a result, harbors animus against him. See 28 U.S.C. §§ 144 and 455(a). However, recusal
is necessary only where a “reasonable, objective person, knowing all of the circumstances, would
have questioned the judge’s impartiality.” See Hughes v. United States, 899 F.2d 1495, 1501 (6th
Cir. 1990). This is an objective standard and it is not based “on the subjective view of a party.”
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Browning v. Foltz, 837 F.2d 276, 279 (6th Cir. 1988). Here, Smith’s subjective speculation alone
is insufficient to form the basis of a judicial bias claim. See Hughes, 899 F.2d at 1501.
On appeal, Smith raises other issues such as the constitutionality of the time limitations for
bringing a lawsuit, his grandfather’s previous lawsuit, and the immorality of big corporations like
Caterpillar. These claims are either irrelevant or lack factual or legal basis.
III.
Accordingly, we AFFIRM the district court’s grant of summary judgment on all claims.
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