Stephen B. Himmel v. Ford Motor Company , 342 F.3d 593 ( 2004 )

MOORE, J., delivered the opinion of the court, in which KATZ, D.J., joined. ROGERS, J. (pp. 602-606), delivered a separate dissenting opinion.

OPINION

MOORE, Circuit Judge.

Plaintiff-Appellant Stephen B. Himmel (“Himmel”) appeals the district court’s grant of summary judgment to Defendant-Appellee Ford Motor Company (“Ford”). Ford terminated Himmel’s employment as the Supervisor of Labor Relations, Hourly Personnel, and Safety in October 1997. According to Himmel, prior to his termination, he had complained about the labor practices that violated Section 302 of the Labor Management Relations Act (“LMRA”), 29 U.S.C. § 186, alleging: (1) Ford improperly agreed with the United Auto Workers (“UAW”) that ten percent of its hires would be referrals from UAW officials; (2) Himmel was forced by Ford to hire a referral from the UAW’s National Ford Department; and (3) Ford improperly settled two grievances with awards of back pay. Himmel filed suit against Ford, alleging that he was wrongfully terminated in retaliation for his complaints and that such termination violated the public policy of Ohio as expressed in Section 302 of the LMRA. The district court granted Ford’s motion for summary judgment, reasoning that Himmel’s discharge would not jeopardize Ohio public policy because Himmel had both participated in Ford’s violations and committed his own independent violations of the LMRA. Himmel filed a timely notice of appeal.

Because the illegal conduct of an employee does not automatically bar his action for a wrongful discharge in violation of public policy under Ohio law, we REVERSE the district court’s judgment and REMAND for further proceedings consistent with this opinion.

I. FACTUAL AND PROCEDURAL HISTORY

Beginning in 1977, Himmel was employed at Ford’s Sharonville, Ohio, transmission plant (“Sharonville”), first as a Labor Relations Specialist and then as Supervisor of Labor Relations, Hourly Personnel, and Safety. In his capacity as a supervisor, Himmel was responsible for all matters involving hourly workers. Because the UAW represented Ford’s hourly personnel at Sharonville, Himmel served as Ford’s representative to the Union and was responsible for the daily administration of the collective bargaining agreements between Ford and the UAW.

According to Himmel, during his tenure as a supervisor, he complained to Ford about Ford’s improper favoritism to UAW officials. Specifically, Himmel maintains that he objected to three instances of Ford’s alleged improper conduct: (1) Ford’s agreement with the UAW that ten percent of its nationwide hiring would be referrals from UAW officials; (2) Ford’s decision to hire Richard Forste (“Forste”) after Himmel refused to give priority status to Forste as a referral from the UAW’s National Ford Department; and (3) Ford’s handling of the settlement of an employee grievance.

According to Himmel, Ford has long agreed that ten percent of its national hiring would be comprised of referrals from individual UAW officials. The UAW’s National Ford Department gives referrals to Ford’s World Headquarters, which in turn passes the reference along to individual plants. Ford forces its plants to give priority status to these referrals, according to Himmel, by refusing to support any plant that refuses to do so when that plant is the object of Union pressure. Himmel maintains that he complained about this ten-percent policy to his superiors on numerous occasions, although the content and time of these complaints is unclear.

In September 1996, Ford ordered Shar-onville to hire a National Ford Department referral after Himmel had expressly declined to hire the referral and filled all available positions with other hires. When three journeyman electrician positions became available in June, Himmel opted to promote three qualified employees already working at Sharonville rather than to hire Forste, a National Ford Department referral. The National Ford Department informed Himmel that they considered his hiring decision “a slap in the face.” Joint Appendix (“J.A.”) at 135-36. Himmel had promoted the three Sharonville employees without first requiring their completion of a skilled-trades test, and the National Ford Department threatened to make pre-hiring testing an issue at Ford’s upcoming national negotiations with the UAW unless Sharonville found a way to hire Forste. Although there were no open positions remaining at Sharonville, Ford’s Powertrain Operations division decided to hire Forste.¹ Himmel complained to his Pow-ertrain Operations supervisors about the forced hire and filed a written complaint with Ford’s Office of General Counsel.² In spite of Himmel’s complaints, Ford ordered Sharonville to hire Forste, and Him-mel complied with the order.

While Ford was deciding whether to hire Forste, two journeymen electricians at a nearby Ford plant asked to be transferred to Sharonville plant. The electricians, Frank Kuykendall (“Kuykendall”) and Ruth Jackson (“Jackson”) filed grievances against Ford through the UAW in October 1996. According to Kuykendall and Jackson, the collective bargaining agreements between Ford and the UAW required Sharonville to prefer Ford employees over non-Ford employees applying for an open electrician position. Jackson also filed a grievance against Ford and the UAW with the National Labor Relations Board (“NLRB”) in December 1996. When Ford finally transferred Kuykendall and Jackson to Sharonville in February 1997, they continued to dispute the issue of back pay. In June 1997, Ford agreed to pay both Kuykendall and Jackson for 420 hours of back pay, the number of hours that Forste had worked between the date of his hire and the day before Kuykendall and Jackson were transferred to Sharon-ville.

Himmel alleges that, upon learning of the settlement, he immediately complained to his boss that “it ‘stinks’ and is ‘illegal.’ ” J.A. at 176 (Himmel Aff.). Moreover, a few weeks later, Himmel informed a Pow-ertrain Operations official that the settlement violated “federal law” when she telephoned him to ask whether he had issued the settlement payment. According to Himmel, Ford had agreed prior to the settlement that only Jackson, the more senior employee who would have received Forste’s position, had standing to grieve Ford’s decision to hire a non-Ford-employee applicant at Sharonville. According to Himmel, Kuykendall was not entitled to a remedy, and likely received one only because he was married to the niece of the National Ford Department official who negotiated the settlement. Moreover, Him-mel maintained that under the terms of the labor contract the back pay award should have extended back only to the UAW’s latest refusal of Ford’s settlement offer, not to Forste’s start date.

A few days after Himmel initially complained about the impropriety of the Kuyk-endall settlement, Ford began investigating Himmel to determine whether he had improperly promoted UAW collective bargaining representatives.³ According to Ford, it concluded that Himmel had committed seven separate violations of Ford policy which could have subjected Ford to criminal and/or civil liability. Ford decided that discharge was the appropriate penalty and terminated Himmel’s employment in October 1997.

Himmel filed an action against Ford in October 1999, alleging a single count of wrongful discharge based on Ohio’s public policy exception to the employment-at-will doctrine. Himmel argues that Ford’s asserted grounds for his discharge were pre-textual and maintains that the promotions he gave were legitimate and previously approved by Ford labor officials. According to Himmel, Ford actually terminated him in retaliation for his complaints about Ford’s conduct in violation of Section 302 of the LMRA, which prohibits employers and their agents from providing “any ... thing of value” to a union or union official. 29 U.S.C. § 186(a). Himmel maintains that Ford’s violations implicated Ohio public policy and therefore permitted his wrongful discharge action.

The district court granted Ford’s motion • for summary judgment, concluding that Himmel’s recovery for wrongful discharge was barred by Himmel’s participation in Ford’s violations of Section 302 and by his own violations of Section 302. Himmel filed a timely notice of appeal.

II. ANALYSIS

A. Standard of Review

We review the district court’s grant of summary judgment de novo. Equitable Life Assurance Soc’y of the U.S. v. Poe, 143 F.3d 1013, 1016 (6th Cir.1998). Summary judgment is appropriate “if the pleadings, depositions, answers to intérrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact.” Fed.R.Civ.P. 56(c). A dispute over a material fact is not considered “genuine” unless “a reasonable jury could return a verdict for the nonmoving party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986) (quotation omitted). In deciding whether summary judgment was appropriate, we view all evidence in the light most favorable to the nonmoving party. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986).

In reviewing a grant of summary judgment, we employ the same legal standard that the district court applied. Equitable Life Assurance Soc’y, 143 F.3d at 1015. Because we are sitting in diversity,⁴ see 28 U.S.C. § 1332, we apply the law, including the choice of law rules, of the forum state. Hayes v. Equitable Energy Res. Co., 266 F.3d 560, 566 (6th Cir.2001) (citing Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487, 496, 61 S.Ct. 1020, 85 L.Ed. 1477 (1941)). Here the parties agree that the substantive law of Ohio governs. Because the question at issue has not yet been resolved by the Ohio courts, we must attempt to predict what the Ohio Supreme Court would do if confronted with the same question. Stalbosky v. Belew, 205 F.3d 890, 893-94 (6th Cir.2000).

B. Greeley Claims: Ohio’s Public Policy Exception to Employment at Will

Ohio refers to claims of wrongful discharge in violation of public policy as Greeley claims. See Greeley v. Miami Valley Maint. Contractors, Inc., 49 Ohio St.3d 228, 551 N.E.2d 981 (1990), overruled in part by Tulloh v. Goodyear Atomic Corp., 62 Ohio St.3d 541, 584 N.E.2d 729 (1992). In Greeley, Ohio first recognized that “public policy warrants an exception to the employment-at-will doctrine when an employee is discharged or disciplined for a reason which is prohibited by statute.” Id. at 986. The Ohio Supreme Court gradually expanded the scope of Greeley actions, ultimately articulating four elements that a plaintiff must prove to establish a public-policy claim:

1. That [a] clear public policy existed and was manifested in a state or federal constitution, statute or administrative regulation, or in the common law (the clarity element).

2. That dismissing employees under circumstances like those involved in the plaintiffs dismissal would jeopardize the public policy (the jeopardy element).

3. The plaintiffs dismissal was motivated by conduct related to the public policy (the causation element).

4. The employer lacked overriding legitimate business justification for the dismissal (the overriding justification element).

Collins v. Rizkana, 73 Ohio St.3d 65, 652 N.E.2d 653, 657-58 (1995) (quoting Henry H. Perritt, Jr., The Future of Wrongful Dismissal Claims: Where Does Employer Self Interest Lie?, 58 U. Cin. L.Rev. 397, 398-99 (1989)).

To decide whether summary judgment for Ford was improper, we must consider whether Himmel has established a genuine issue of material fact as to each element of his Greeley claim. As an initial matter, we note that the issue of clarity has been resolved in Himmel’s favor; Ford concedes on appeal “that Section 302 of the LMRA embodies a sufficiently clear public policy to serve as the foundation for a wrongful discharge claim.” Ford Br. at 33-34. Moreover, it is clear that Himmel has established a genuine issue of material fact as to both causation and overriding justification. See Collins, 652 N.E.2d at 658 (explaining that, under Ohio law, these two Greeley elements are questions of fact for the jury). With respect to causation, Ford argues that Himmel was terminated for violating Ford company policy and the policy of the LMRA, but Himmel has presented contrary evidence suggesting his termination was motivated by Himmel’s complaints about Ford’s violations of the public policy of the LMRA. Similarly, Ford has introduced evidence that Himmel engaged in wrongful conduct which amounted to a legitimate overriding business justification for dismissing Himmel. Himmel counters this argument with evidence that his conduct was in accord with company policy and the law. In light of the parties’ disputes about the facts and how to interpret them, we conclude that Himmel established a genuine issue of material fact as to the causation and overriding justification elements of his Greeley claim. Therefore, our inquiry will focus on the jeopardy element of Himmel’s Greeley claim.

1. Jeopardizing Ohio’s Public Policy

The Ohio Supreme Court characterizes the jeopardy inquiry as a question of law for the court. Id. Therefore, for summary judgment purposes, we must determine whether dismissing employees under the circumstances of Himmel’s dismissal would jeopardize the clear public policy of Section 302. Ohio has yet to adopt a clear analytical framework for analyzing jeopardy, and discussions of this element by Ohio courts are often quite brief. However, Henry H. Perritt, Jr., who originally articulated the analytical framework that was subsequently adopted by the Ohio Supreme Court for Greeley claims, has identified three steps of jeopardy analysis: (1) determine “what kind of conduct is necessary to further the public policy” at issue; (2) decide whether the employee’s actual conduct fell within the scope of conduct protected by this policy; and (3) consider whether employees would be discouraged from engaging in similar future conduct by the threat of dismissal. Perritt, supra, at 408. Given the Ohio Supreme Court’s reliance on Professor Perritt’s articulation of the jeopardy element in Collins and subsequent cases involving Greeley claims, we believe that Perritt’s framework of jeopardy analysis provides guidance in our analysis of the facts at hand.

Section 302 of the LMRA provides that “[i]t shall be unlawful for any employer ... to pay, lend, or deliver, or agree to pay, lend, or deliver, any money or other thing of value ... to any labor organization, or any officer or employee thereof, which represents, seeks to represent, or would admit to membership, any of the employees of such employer who are employed in an industry affecting commerce.” 29 U.S.C. § 186(a). When Congress enacted Section 302, it was “concerned with corruption of collective bargaining through bribery of employee representatives by employers, with extortion by employee representatives, and with the possible abuse by union officers of the power which they might achieve if welfare funds were left to their sole control.” Arroyo v. United States, 359 U.S. 419, 425-26, 79 S.Ct. 864, 3 L.Ed.2d 915 (1959) (footnotes omitted); see Turner v. Local Union No. 302, Int’l Bhd. of Teamsters, 604 F.2d 1219, 1227 (9th Cir.1979) (“The dominant purpose of § 302 is to prevent employers from tampering with the loyalty of union offi-ciáis and to prevent union officials from extorting tribute from employers.”)- In short, the public policy of Section 302 can be described as preventing corruption in union-employer relationships.

Corruption in union-employer relationships will often not come to light in the absence of reporting by an insider in the process. Therefore, to achieve the policy goal of Section 302, employees must be in a position where they are able to articulate their observations and suspicions of such corruption. See, e.g., Kulch v. Structural Fibers, Inc., 78 Ohio St.3d 134, 677 N.E.2d 308, 324 (1997) (suggesting that Ohio needs employees to report legitimate health and safety concerns to further Ohio’s policy favoring workplace safety), abrogation on other grounds recognized by Krickler v. Brooklyn, 149 Ohio App.3d 97, 776 N.E.2d 119 (2002); Jamison v. American Showa, Inc., 99CAE-03-014, 2000 WL 1404, at *11 (Ohio Ct.App. 5th Dist. Dec. 16, 1999) (noting that employee reporting of an employer’s environmental violations benefits “the health and safety of an entire community”). Reporting is essential to furthering the policy goals of a statutory provision like Section 302 because one can imagine any number of circumstances where corruption would likely go unnoticed in the absence of employee complaints.

Having determined that employee complaints of conduct thought to violate Section 302 are essential to furthering the purpose of that provision, we proceed to evaluate whether Himmel’s conduct fell within the scope of employee complaints protected by the policy of preventing corruption in union-employer relationships. No Ohio law suggests that Himmel needed to invoke a specific statute as a basis for his complaints of wrongdoing at the time he complained to Ford. Moreover, no Ohio law suggests that, at the time of his complaint, an employee must be certain that the seemingly inappropriate conduct is actually illegal. See Fox v. City of Bowling Green, 76 Ohio St.3d 534, 668 N.E.2d 898, 902 (1996) (explaining in the context of the Ohio Whistleblower Statute, Ohio Revised Code § 4113.52, that “requir[ing] that an actual violation must occur for a whistle-blower to gain protection leads to nonsensical results which are unjust, unreasonable, and contrary to the spirit of the statute and public policy”). Rather, an employee simply must have had a “good faith belief that [his] complaint was valid” at the time of his complaint. Kulch, 677 N.E.2d at 324; Pytlinski v. Brocar Prods., Inc., 94 Ohio St.3d 77, 760 N.E.2d 385, 386 (2002) (allowing a Greeley claim where an employee complained of conduct that he “believed to be in violation of the Occupational Safety and Health Administration ... regulations”). Employees should be encouraged to complain about their employers’ potentially illegal conduct, even when they are not certain that the conduct is improper as a matter of law. Requiring employees to do legal research prior to making a complaint would contravene Ohio’s public policy by depriving employees of a remedy for wrongful discharge whenever they object to apparently inappropriate conduct before doing adequate research.

Viewing the facts in the light most favorable to Himmel, we conclude that Him-mel’s complaints about the ten-percent policy, the hiring of Forste, and the Kuyk-endall settlement were conduct furthering the policy of Section 302.⁵ These complaints all implicate Ford’s relationship with the UAW and involve Ford’s alleged preferential treatment of UAW referrals and employees with UAW connections. Because all three instances of Ford’s alleged misconduct implicate the potential corruption of union-employer relationships, Himmel’s objections constitute conduct within the scope of Section 302.

Finally, we recognize that permitting Ford to dismiss Himmel in retaliation for Himmel’s complaints about Ford’s potential corruption of union-employer relations would discourage other Ford employees from complaining about future conduct by Ford that threatened further to corrupt those relations. See Kulch, 677 N.E.2d at 324 (explaining that allowing an employer to dismiss an employee for filing a complaint about unlawful practices would deter other employees from reporting legitimate concerns); Perritt, supra, at 408 (“The third substep [of jeopardy analysis] is to decide if the threat of dismissal is likely in the future to discourage the employees from engaging in similar conduct. The answer to the third question almost always wül be ‘yes.’ ”).

Therefore, because employee reporting of employer activities that might violate Section 302 is conduct necessary to further the policy of Section 302, because Him-mel’s conduct falls within the scope of this pohcy, and because Ford’s dismissal of Himmel would discourage other employees from complaining about conduct potentially corrupting union-employer relations, we conclude that the facts viewed in the light most favorable to Himmel establish under Ohio law “[t]hat dismissing employees under circumstances like those involved in [Himmel’s] dismissal would jeopardize the public policy” behind Section 302. Collins, 652 N.E.2d at 657 (internal quotation omitted).

2. Conduct Barring a Greeley Claim

Although the above analysis indicates that Himmel has established jeopardy for purposes of his Greeley claim, Ford nevertheless maintains that Himmel’s alleged violations of Section 302, as well as his participation in Ford’s alleged violations of Section 302, preclude this court from finding that the jeopardy element is met. According to Ford, this court should therefore affirm the district court’s grant of summary judgment for Ford on the jeopardy element of Himmel’s Greeley claim.

The jeopardy element of a Greeley claim takes into account a plaintiffs conduct only to the extent necessary to determine whether it falls within the scope of conduct necessary to further the public policy at issue. See Perritt, supra, at 408. In this case, employee complaints of employer activities that are contrary to the public policy of Section 302 are essential to furthering the purposes of that statute. We therefore look only at Himmel’s reporting of complaints; it is not necessary for the purposes of jeopardy analysis to examine any of Himmel’s allegedly improper conduct. Moreover, because Ohio describes the jeopardy inquiry as a question of law for the court, Collins, 652 N.E.2d at 658, at the summary judgment stage, the jeopardy inquiry serves only to determine whether public policy would be jeopardized by permitting an employer to dismiss an employee on the facts viewed in the light most favorable to a plaintiff employee.

We do recognize that Himmel’s alleged wrongful conduct may be relevant to the resolution of his Greeley claim in other respects, however. Himmel’s ability to recover under Greeley will be impacted by his own alleged violations of Section 302 because such violations are likely relevant to the elements of causation and overriding justification. It would be difficult for an employee to show that his dismissal was “motivated by conduct related to the public policy” at issue if his employer could point to the employee’s illegal conduct as the cause for dismissal. Collins, 652 N.E.2d at 657 (internal quotation omitted). Similarly, it would be difficult for an employee to establish the absence of a legitimate overriding business justification for his termination if the employee has violated company policy and federal law. In this sense, Ford’s allegations that Himmel violated Section 302 are relevant to the outcome of Himmel’s Greeley claim. However, because Himmel has demonstrated a genuine issue of material fact with respect to the elements of causation and overriding justification, summary judgment was not appropriate.

Because we do not believe that Ohio law regards either complicity in an employer’s wrongdoing or independent wrongdoing as an automatic bar to Greeley claims, the district court erred by concluding that Ford was entitled to summary judgment.

III. CONCLUSION

For the reasons explained above, we conclude that the district court erred in granting Ford summary judgment on grounds that Himmel’s Greeley claim was barred by Himmel’s own alleged violations of Section 302. Himmel has established' jeopardy as a matter of law and, viewing the facts in the light most favorable to Himmel, we conclude that there are genuine issues of material fact as to causation and overriding justification. For these reasons and because the clarity of Section 302’s policy is not in dispute, we REVERSE and REMAND the district court’s judgment for further proceedings consistent with this analysis.

1 . Forste was not a UAW member and did not submit an employment application, interview for the position, or take a skilled-trades test.

2 . Himmel did not specifically allege in his complaints that Ford's conduct was illegal, instead complaining that the National Ford Department had no standing to file a grievance and that the National Ford Department had no good reasons to oppose his hires— three UAW members — when its own referral was not a UAW member.

3 . Although the parties discuss at length the facts surrounding Ford's decision to terminate Himmel, these facts are not dispositive to our resolution of the case.

4 . Diversity exists between Himmel, an. Ohio citizen, and Ford, a business that is incorporated in and has its principal place of business in states other than Ohio.

5 . Ford does not counter Himmel's factual al-‘ legations that he objected to the ten-percent policy, the Forste hiring, or the Kuykendall and Jackson settlements. Instead Ford suggests that Himmel's conduct did not fall within the scope of Section 302’s policy because (1) Himmel participated in Ford’s alleged wrongdoing, (2) Himmel engaged in conduct equally violative of Section 302's policy against corruption in union-employer relations, and (3) Ford’s conduct of which Him-mel complained was not actually illegal. At issue in this inquiry, however, is only Him-mel’s conduct in complaining about Ford’s potentially illegal activities. Himmel’s own alleged wrongdoing is not relevant to our analysis of whether his complaints fell within the scope of conduct protected by Section 302. Moreover, as discussed above, Himmel was not obligated to do legal research before complaining about apparent corruption.