Jackson v. Public Company Accounting Oversight Board ( 2012 )

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
ROBERT JACKSON,
Plaintiff,
v. Civil Action No. 12-208 (JEB)
PUBLIC COMPANY ACCOUNTING
OVERSIGHT BOARD,
Defendant.
MEMORANDUM OPINION
Plaintiff Robert Jackson was employed until January 2012 at Defendant Public Company
Accounting Oversight Board. He brought this suit asserting that PCAOB breached his implied
employment contract by retaliating against him for providing information in an internal
investigation and also that it wrongfully terminated him. In now moving to dismiss his Amended
Complaint, Defendant correctly argues that Plaintiff has not successfully pled either claim. The
Court, consequently, will grant Defendant’s Motion.
I. Background
According to Plaintiff’s Amended Complaint, which must be presumed true for purposes
of this Motion, he was employed since December 2008 as “Deputy Director, Operations and
Infrastructure of the Office of Information Technology (‘OIT’)” at PCAOB. Am. Compl., ¶ 6.
Two years later, “Defendant commenced an internal investigation regarding OIT governance
and staffing.” Id., ¶ 8. “Plaintiff was one of three senior staff of OIT” who was interviewed,
and he provided “truthful information . . . including his perception that OIT’s senior leadership
was lacking.” Id., ¶¶ 10-11. The final report of the investigation was released in October 2011
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and included a number of negative comments about OIT, which Plaintiff alleges reflect his
statements. Id., ¶¶ 12-13.
After the report was released, Defendant added a senior position, Deputy Chief
Administrative Officer (DCAO), to whom Plaintiff’s superior now reported. Id., ¶ 15. On
December 9, 2011, this new DCAO “met with Plaintiff, made numerous unfounded allegations
that Plaintiff’s conduct and job performance were poor, removed Plaintiff’s staff and threatened
that Plaintiff’s employment was tenuous.” Id., ¶ 17. After complaining to Defendant’s ethics
officer about this, Plaintiff met with its in-house lawyer, who ultimately “proposed that
Plaintiff’s employment terminate in exchange for a severance.” Id., ¶¶ 19, 22. These “actions
made Plaintiff’s workplace intolerable and caused Plaintiff to sustain severe emotional distress
and mental anguish.” Id., ¶ 23. Ultimately, he alleges, his “work conditions were so intolerable
that he was constructively discharged from his employment on January 30, 2011 [sic,
presumably 2012].” Id., ¶ 27.
Plaintiff brings one cause of action, in which he claims, “By and through its conduct,
Defendant breached its anti-retaliation policy and constructively discharged the Plaintiff from
his employment.” Id., ¶ 29. Defendant has now filed a Motion to Dismiss.
II. Legal Standard
Rule 12(b)(6) provides for the dismissal of an action where a complaint fails “to state a
claim upon which relief can be granted.” When the sufficiency of a complaint is challenged
under Rule 12(b)(6), the factual allegations presented in it must be presumed true and should be
liberally construed in plaintiff’s favor. Leatherman v. Tarrant Cty. Narcotics & Coordination
Unit, 507 U.S. 163, 164 (1993). The notice pleading rules are “not meant to impose a great
burden on a plaintiff,” Dura Pharm., Inc. v. Broudo, 544 U.S. 336, 347 (2005), and he or she
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must thus be given every favorable inference that may be drawn from the allegations of fact.
Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 584 (2007). Although “detailed factual
allegations” are not necessary to withstand a Rule 12(b)(6) motion, Twombly, 550 U.S. at 555,
“a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that
is plausible on its face.” Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949 (2009) (internal quotation
omitted). Plaintiff must put forth “factual content that allows the court to draw the reasonable
inference that the defendant is liable for the misconduct alleged.” Id. Though a plaintiff may
survive a 12(b)(6) motion even if “recovery is very remote and unlikely,” Twombly, 550 U.S. at555 (citing Scheuer v. Rhodes, 416 U.S. 232, 236 (1974)), the facts alleged in the complaint
“must be enough to raise a right to relief above the speculative level.” Id. at 555.
III. Analysis
It is somewhat difficult to discern precisely what cause(s) of action Plaintiff intends from
his sole count. Potential ones are breach of contract, wrongful termination, and retaliation.
Although the terms “breach of contract” and “wrongful termination” never appear in the
Amended Complaint, Plaintiff’s Opposition makes clear that these are intended claims. See
Opp. at 6 (“Plaintiff has alleged causes of action for breach of contract and wrongful
termination.”). On the other hand, Plaintiff never argues that the Complaint asserts a separate
retaliation claim, so the Court may assume it did not, and it will thus treat Defendant’s argument
on that point as conceded. See Lewis v. District of Columbia, 2011 WL 321711, at *1 (D.C.
Cir. 2011) (“‘It is well understood in this Circuit that when a plaintiff files an opposition to a
dispositive motion and addresses only certain arguments raised by the defendant, a court may
treat those arguments that the plaintiff failed to address as conceded.’”) (quoting Hopkins v.
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Women’s Div., General Bd. Of Global Ministries, 284 F. Supp. 2d 15, 25 (D.D.C. 2003)). The
Court, accordingly, will address the contract and termination claims in turn.
A. Breach of Contract
Plaintiff does not assert that Defendant has breached a term of a specific employment
contract since he concedes he is an at-will employee. Opp. at 1-2. Instead, his claim rests on an
alleged “violation of Defendant’s written anti-retaliation policy that is contained in its
Employment Policies and Procedures Manual.” Am. Comp., ¶ 2. More specifically, Plaintiff
alleges that this policy “prohibits retaliation against its employees ‘for providing truthful
information in an internal . . . investigation.’” Id., ¶ 5 (ellipses in Amended Complaint). This
policy, he contends, “creates a contract for which Defendant is liable for breaching.” Opp. at 4.
Defendant vigorously disputes this theory, arguing that such a policy in an employee
manual or handbook is not enforceable as an employment contract where a disclaimer exists.
Mot. at 8-10. Defendant is correct. The District of Columbia Court of Appeals has explained
that, although “the terms of an employer’s personnel or policy manual may be sufficient to raise
a jury question as to whether the manual creates contractual rights for the employee . . . , such
implied contractual rights can be disclaimed, and the legal effect of such a disclaimer is, in the
first instance, a question for the court to decide.” Futrell v. Dept. of Labor Federal Credit Union,
816 A.2d 793, 806 (D.C. 2003) (citations and internal quotations marks omitted).
In this case, Defendant has quoted liberally from the Manual, the language of which the
Court may consider on a motion to dismiss because Plaintiff has incorporated it by reference into
his Complaint. See Rand v. Sec’y of the Treasury, 816 F. Supp. 2d 70, 71 (D.D.C. 2011). The
Manual states, in pertinent part, on page 1 under the heading in bold enlarged capitals of
“DISCLAIMER”:
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These policies and procedures are not intended to provide fixed
rules for dealing with all problems that arise in the workplace;
rather, they set forth general guidelines, subject to modification or
departure by the PCAOB as circumstances may require. . . .
Nothing in these policies or procedures is intended to serve as a
contract or to create enforceable rights on the part of employees.
Opp., Attach. 1 (Declaration of Christine Kearns), Exh. A (Employment Policies and Procedures
Manual) at 1 (emphasis added).
In addition, as Defendant points out, the Manual also provides: “Employees at the
PCAOB are employed on an at-will basis, which means that . . . the PCAOB may terminate an
employee’s employment at any time for any lawful reason, or for no reason, with or without
notice. A modification of an employee’s at-will status may only be made by a written agreement
signed by the employee and the Chairman of the PCAOB.” Id. at 2. Finally, the Manual
contains an acknowledgment form, in which employees state that they “understand and agree
that . . . [¶] [their] employment with the PCAOB is ‘at-will.’ No PCAOB policy is an
employment contract . . . .” Id. at 80.
It is difficult to conceive of a clearer disclaimer that an employer could make. The Court
will thus hold, as a matter of law, that PCAOB’s anti-retaliation policy did not create judicially
enforceable contractual rights. Such a ruling is consistent with D.C. Court of Appeals cases and
cases from this federal District. See, e.g., Futrell, 816 A.2d at 806 (affirming trial court’s
conclusion that employee guidebook did not create implied employment contract where it clearly
stated that it “‘does not constitute an expressed or implied employee contract’”); Boulton v.
Institute of Intern. Educ., 808 A.2d 499, 505 (D.C. 2002) (affirming trial court’s rejection of
plaintiff’s argument that employee handbook created implied contract where it “included
‘precise’ language disclaiming any intent to create contractual rights or obligations and
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specifically preserving the ‘at-will’ nature of the employment relationship”) (footnote omitted);
Grove v. Loomis Sayles & Co., L.P., 810 F. Supp. 2d 146, 149 (D.D.C. 2011) (granting motion
to dismiss breach-of-contract claim based on language in employee handbook and holding that
“[e]ven if the employer has provided its employees with an employee handbook, the handbook is
not enforceable as an employment contract if it disclaims the establishment of contractual
obligations and explicitly provides that employment may be terminated at-will”) (citations
omitted).
Plaintiff’s sole authority to the contrary is Scott v. Merck & Co., 2010 WL 4941994 (D.
Md. 2010), in which a Maryland district court denied summary judgment to an employer in a
breach-of-contract case based on language in company policies. Even if the facts of the case
were on all fours with those here – a determination the Court need not make – this Court is, of
course, bound to follow law in the District of Columbia. While a consideration of Maryland law
might well be helpful in a circumstance in which D.C. law is unsettled, that is not the case here.
This Court must follow the clearly articulated doctrine set forth by the District of Columbia
Court of Appeals. It will, accordingly, dismiss Plaintiff’s claim for breach of contract based on
language in the Manual.
B. Wrongful Termination
Plaintiff’s Opposition explains that he is also bringing a claim for wrongful termination.
Opp. at 6. Although the Court has serious concerns about whether Plaintiff’s allegations of
constructive discharge are even sufficient to pursue a wrongful-termination action, the Court
need not decide this question. This is because, even assuming Plaintiff was constructively
discharged, he has failed to plead a wrongful-termination cause of action.
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In considering Plaintiff’s claim for wrongful termination, the Court starts with the general
proposition that “in the District of Columbia . . . 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.,
Inc., 597 A.2d 28, 30 (D.C. 1991) (citations omitted). In Adams, the D.C. Court of Appeals held
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.” Id. at 34.
The DCCA then expanded this exception six years later in its en banc decision in Carl v.
Children’s Hospital, 702 A.2d 159 (D.C. 1997). The plaintiff in Carl was a nurse who was
terminated after she testified in the City Council against the hospital’s interests and also as an
expert witness for plaintiffs in malpractice cases. Id. at 160. The Court held 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.” Id. A majority of the DCCA – as constituted by those joining Judge Terry’s
concurrence and Judge Steadman’s dissent – held that “the recognition of any such [future
public-policy] 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.” Id. at 162(Terry, J., concurring). In addition, “[t]his 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
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the policy thus declared and the conduct at issue in the allegedly wrongful termination.” Id. at
164 (Terry, J., concurring) (footnotes omitted).
In this case, Plaintiff never mentions any Constitutional provision, statute, or public
policy in his Complaint. He alleges only that his termination (via constructive discharge)
violated Defendant’s policies. See Compl., ¶¶ 2, 24, 29. Even in his Opposition, Defendant only
generally cites what he calls “the public policy exceptions to at-will employment under District
of Columbia law.” Opp. at 6. This clearly does not suffice. See Davis v. Gables
Residential/H.G. Smithy, 525 F. Supp. 2d 87, 102 (D.D.C. 2007) (“Plaintiff's wrongful discharge
claim is deficient, however, because it does not identify any public policy purportedly violated
by his termination.”); Chisholm v. District of Columbia, 666 F. Supp. 2d 96, 117 (D.D.C. 2009)
(“The plaintiff does not point to any fundamental public policy expressed in the constitution or
the statutes of the District of Columbia that support her position, but rather points to the general
policy of the Courts' Comprehensive Policies . . . .”); Martin v. American Univ., 1999 WL
1125168, at *2 (D.C. Cir. 1999) (“it is not clear that the code provisions [namely, ‘the District’s
codes that regulate nurses’] on which Dr. Martin relies articulate the type of public policy
necessary to trigger the public policy exception”) (citation omitted); Lurie v. Mid-Atlantic
Permanente Medical Group, P.C., 729 F. Supp. 2d 304, 326 (D.D.C. 2010) (“Even if one accepts
plaintiff's account of himself as a whistleblower punished for his good deeds, plaintiff is unable
to identify an appropriate public policy on which to base his claim.”); cf. Liberatore v. Melville
Corp., 168 F.3d 1326, 1331 (D.C. Cir. 1999) (“In his brief, Liberatore cites both federal and
District of Columbia law proscribing the improper storage of drugs.”) Freas v. Archer Services,
Inc., 716 A.2d 998 (D.C. 1998) (permitting wrongful-termination case to proceed where
employee was terminated after suing employer for violating statute that prohibits deductions
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from employee’s paycheck for workers’ compensation insurance premiums, and complaint cited
particular statute that employer’s behavior violated).
As Plaintiff’s claim for wrongful termination does not fit within the coverage of the
public-policy exception, it cannot move forward.
IV. Conclusion
Because Plaintiff does not survive this Motion, an Order issued this day will dismiss the
case.
/s/ James E. Boasberg
JAMES E. BOASBERG
United States District Judge
Date: May 2, 2012
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