Zahodnick v. IBM

UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
GEORGE ZAHODNICK,
Plaintiff-Appellant,
v.
INTERNATIONAL BUSINESS MACHINES
CORPORATION; LOCKHEED MARTIN
FEDERAL SYSTEMS, INCORPORATED, No. 96-2663
Defendants-Appellees,
and
JOHN MEARS; TED GLATT; BRYAN
TROUTMAN,
Parties in Interest.
Appeal from the United States District Court
for the District of Maryland, at Baltimore.
Catherine C. Blake and Alexander Williams, Jr., District Judges.
(CA-94-3569-CCB)
Argued: June 6, 1997
Decided: December 22, 1997
Before RUSSELL, WIDENER, and WILKINS, Circuit Judges.
_________________________________________________________________
Affirmed by unpublished per curiam opinion.
_________________________________________________________________
COUNSEL
ARGUED: Bradley Scott Weiss, LAW OFFICE OF BRADLEY
SCOTT WEISS, Washington, D.C., for Appellant. Ellen Moran
Dwyer, CROWELL & MORING, L.L.P., Washington, D.C., for
Appellees. ON BRIEF: Michael A. Lewis, Washington, D.C., for
Appellant. Caryl L. Flannery, CROWELL & MORING, L.L.P.,
Washington, D.C., for Appellees.
_________________________________________________________________
Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).
_________________________________________________________________
OPINION
PER CURIAM:
George Zahodnick filed suit against his employers, International
Business Machines Corporation ("IBM") and Lockheed Martin Fed-
eral Systems, Incorporated,1 alleging (1) retaliation under the False
Claims Act, 31 U.S.C. § 3730(h) (1994); (2) abusive discharge; and
(3) breach of employment contract. Lockheed counterclaimed for
breach of nondisclosure agreements. Zahodnick appeals the district
court order granting IBM and Lockheed summary judgment on all of
Zahodnick's claims and granting Lockheed summary judgment on the
counterclaim. The court also enjoined Zahodnick from disclosing
confidential information to third parties and ordered him to return all
confidential materials to the Defendants. We affirm the district court's
judgment.
Zahodnick worked as a managing engineer at IBM and Federal
Systems Company ("FSC"), a division of IBM, from 1981 to 1994.2
The crux of Zahodnick's claims concern events commencing in Sep-
tember 1989 while he was working at FSC's Gaithersburg, Maryland
facility. At that time, Zahodnick assembled cost information on a pro-
posal to extend IBM's "DSIS" contract with the Defense Intelligence
_________________________________________________________________
1 In 1996, Loral Federal Systems Company, a defendant below, was
acquired by Lockheed Martin and became known as Lockheed Martin
Federal Systems, Inc. We refer to the company as"Lockheed."
2 In 1994, Loral acquired FSC.
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Agency. During the course of his research, Zahodnick discovered that
the "work package number" to which employees working on the proj-
ect were charging their time was incorrect. The assigned number was
actually associated with the DSIS contract rather than the proposal
effort. Zahodnick reported the mischarging to his supervisor. Zahod-
nick claims that shortly after he reported this error, he began receiving
negative treatment from the company in the form of unfavorable work
performance evaluations, unsuccessful appeals, and denials of transfer
requests.
In November 1989, Zahodnick received his annual evaluation of
his work performance. Although the review was generally satisfac-
tory, it criticized Zahodnick for his lack of leadership qualities.
Zahodnick pursued an appeal under the company's appeal policy and
succeeded in having the comments deleted after an investigation. In
June 1990, Zahodnick's request for relocation and transfer was
denied, but the next year he received a temporary transfer to Califor-
nia. Zahodnick's 1992 evaluations also criticized his lack of com-
munication and leadership skills. Investigators who reviewed Zahod-
nick's appeal concluded that the evaluations were fair. Zahodnick
returned to Maryland in May 1992, after rejecting a permanent posi-
tion in California.
Over the next two years, Zahodnick continued to receive and
unsuccessfully appeal his work evaluations, which he believed did not
accurately reflect his true performance. In early 1994, Zahodnick
accepted a transfer offer to Springfield, Virginia, where he worked for
a short period of time. By late March of 1994, Zahodnick no longer
worked for IBM and Lockheed. Zahodnick maintains the company
terminated his employment. The record of evidence reveals, however,
that Zahodnick voluntarily resigned, and that he brought this suit
against the company under the "whistle blower" provision of the False
Claims Act only after learning that his voluntary resignation disquali-
fied him from receiving an enhanced separation package and unem-
ployment compensation benefits.
Summary judgment is appropriate when there is no genuine issue
of material fact and it appears that the moving party is entitled to
judgment as a matter of law. See Fed. R. Civ. P. 56(c); Adickes v. S.H.
Kress & Co., 398 U.S. 144, 157 (1970). On summary judgment, all
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evidence must be viewed in the light most favorable to the party
opposing the motion. See Matsushita Elec. Indus. v. Zenith Radio
Corp., 475 U.S. 574, 587-88 (1986). Summary judgments are
reviewed de novo on appeal. See Higgins v. E.I. DuPont De Nemours
& Co., 863 F.2d 1162, 1166-67 (4th Cir. 1988).
The "whistleblower" provision of the False Claims Act prevents the
harassment, retaliation, or threatening of employees who assist in or
bring qui tam actions. The statute provides:
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, initia-
tion of, testimony for, or assistance in an action filed or to
be filed under this section, shall be entitled to all relief nec-
essary to make the employee whole . . . .
31 U.S.C. § 3730(h). Thus, an employee must prove that (1) he took
acts in furtherance of a qui tam suit; (2) his employer knew of these
acts; and (3) his employer discharged him as a result of these acts. See
X Corp. v. Doe, 816 F. Supp. 1086, 1095 (E.D. Va. 1993).
Here, there is no evidence that Zahodnick initiated, testified for, or
assisted in the filing of a qui tam action during his employment with
IBM and Lockheed. In fact, the record discloses that Zahodnick
merely informed a supervisor of the problem and sought confirmation
that a correction was made; he never informed anyone that he was
pursuing a qui tam action. Simply reporting his concern of a
mischarging to the government to his supervisor does not suffice to
establish that Zahodnick was acting "in furtherance of" a qui tam
action. See Robertson v. Bell Helicopter Textron, Inc., 32 F.3d 948,
951 (5th Cir. 1994).
Furthermore, there is no evidence that IBM and Lockheed were
aware of Zahodnick's alleged protected activity. Without evidence of
any knowledge on the part of IBM and Lockheed, Zahodnick cannot
establish the necessary causal connection between the alleged pro-
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tected activity and Zahodnick's termination of employment four years
later. Accordingly, we affirm the district court's grant of summary
judgment against Zahodnick on this claim.
We also find that the district court properly granted summary judg-
ment on the abusive discharge claim. Maryland courts recognize a
cause of action for abusive discharge available to employees who
have been fired in contravention of public policy. See Adler v. Ameri-
can Standard Corp., 432 A.2d 464, 473 (Md. 1981). The action
applies when an employee has refused to act in an unlawful manner,
attempted to perform a statutorily prescribed duty, exercised a statu-
tory right or privilege, or performed an important public function. See
Makovi v. Sherwin-Williams Co., 561 A.2d 179, 182 (Md. 1989). The
remedy, however, is unavailable when the "public policy sought to be
vindicated by the tort" is expressed in a "statute which carries its own
remedy for vindicating that public policy." Chappell v. Southern Md.
Hosp., Inc., 578 A.2d 766, 770 (Md. 1990). We conclude that
§ 3730(h) adequately covers Zahodnick's claim. As the district court
noted, even assuming Zahodnick could pursue an abusive discharge
claim, he failed to produce any evidence suggesting a causal relation-
ship between his report of the mischarging error and his termination
four years later. Accordingly, the district court properly granted
Defendants summary judgment on this claim.
With respect to Zahodnick's breach of contract claim, employment
is at-will in Maryland unless the employee can show that the contract
has "been so modified by the personnel policy statement as to remove
it from the full strictures of the common-law rule." Staggs v. Blue
Cross of Md., Inc., 486 A.2d 798, 801 (Md. App. 1985). An employer
may include a clear disclaimer, however, to avoid contractual liability
for a personnel policy. See Bagwell v. Peninsula Reg'l Med. Ctr., 665
A.2d 297, 309 (Md. App. 1995).
In 1993 Defendants provided employees with a handbook bearing
a disclaimer. It stated that IBM and FSC "reserve[d] the right to
change all their benefits, separation plans, programs, practices, poli-
cies and rules at any time." It further stated that "[t]he employment
relationship with IBM and Federal Systems Company is at will. This
means that the relationship can be ended at any time for any reason
by the employee or by IBM or the Federal Systems Company."
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Because this disclaimer is unambiguous, we find the breach of con-
tract claim without merit.
As to Lockheed's counterclaim for breach of confidentiality, the
record discloses that Zahodnick signed two nondisclosure agreements.
In these agreements, Zahodnick agreed not to disclose confidential
information to anyone outside of IBM and to return all IBM property
to IBM when he left IBM's employment. Zahodnick retained confi-
dential materials belonging to IBM after termination of his employ-
ment and forwarded those documents to his counsel without IBM's
consent. Under such circumstances, the district court did not err either
in enjoining Zahodnick from disclosing Lockheed's confidential
materials to third parties or in ordering Zahodnick to return all confi-
dential materials to Lockheed. Accordingly, we affirm the district
court's order.
AFFIRMED
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