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Whistleblower case reversed by COA.

Byline: Thomas Franz

In a recent whistleblower case, a Michigan Court of Appeals panel reversed a Saginaw Circuit Court ruling by granting a motion for summary disposition in favor of a company that was alleged to have unlawfully retaliated against a now former employee.

In Rivera v. SVRC Industries (MiLW No. 07-99926, 11 pages), the appeals court determined a laid-off employee failed to establish a prima facie case against her employer.

"We had provided the legitimate business purpose for her termination, but ultimately the COA held that we didn't need to get to that point because the plaintiff did not meet her initial burden," said defense attorney Kailen C. Piper of O'Neill, Wallace & Doyle PC in Saginaw.

Judge Mark T. Boonstra wrote the April 4 published opinion, joined by Judges Michael J. Kelly and Deborah A. Servitto.

Background

The plaintiff, Linda Rivera, was the director of industrial operations at SVRC Industries from October 2015 to October 2016.

On Sept. 15, 2016, Rivera had a meeting with an employee who the court's opinion referred to as LS. The plaintiff claims that LS spoke during that meeting about the possibility of a "revolution" in this country and alluded to the fact that he could use a firearm, and was not afraid to pull the trigger.

Rivera reported the comments to SVRC's COO, Debra Snyder, who said she would notify CEO Dean Emerson before providing instructions to Rivera on how to proceed with the situation.

Emerson consulted with company attorney Gregory Mair before telling Snyder to not file a police report, according to the COA opinion.

Rivera discussed the incident with Sylvester Payne, the chairman of SVRC's board of directors and an "on and off" significant other to Rivera.

Snyder told Rivera that the company attorney advised against filing a police report in addition to telling her to be careful with sharing confidential information about company employees since Payne was a company board member and not an employee of SVRC.

Emerson instructed Mair to investigate the incident, and Mair spoke with Rivera and other employees who were present at the meeting with LS.

SVRC then terminated LS's employment on Oct. 3, 2016.

On Oct. 4, 2016, Rivera received notice that she was being permanently laid off from SVRC for "budgetary and economic reasons," which sparked this suit.

Legal action

The plaintiff filed suit against SVRC, claiming the company violated the Whistleblowers' Protection Act by retaliating against Rivera when she was about to report LS's conduct to the police and by retaliating against her for reporting LS's conduct to Mair.

Rivera also claimed that SVRC violated Michigan public policy.

COA analysis

After the Saginaw Circuit Court denied the defendant's motion for summary disposition, SVRC appealed.

The COA requested each party file briefs addressing whether Rivera's communication with Mair was a "report" of a violation or suspected violation of law under the context of the WPA.

The court's analysis opens by citing MCL 15.362 to state that an employer shall not discharge an employee because the employee reports a violation or a suspected violation of a law, unless the employee knows that the report is false.

To survive summary disposition, the court wrote that the plaintiff must establish a prima facie case and can rely on either direct or circumstantial evidence to do so.

About to report

SVRC argued that it should be granted summary disposition on the "about to report" claim because Rivera presented no evidence that she was about to report LS's conduct to the police.

The COA panel agreed with that argument.

After citing several similar cases, the court wrote that Rivera did not threaten to report LS's conduct.

"Rather, while plaintiff's text messages and deposition testimony reveal that she believed that contacting the police was the correct course of action, the record shows only that she discussed with various people the option of filing a police report and conveyed her opinion," the court wrote.

"It does not demonstrate that, after her consultations, she had determined that filing a police report was still the best course of action or, more significantly, that she was on the verge of contacting law enforcement."

Actual report

The COA also agreed with SVRC in that it should be granted summary disposition based on plaintiff's WPA claim premised on her communication with Mair.

The COA determined that Rivera's conversation with Mair was not a "report" of a violation of law. The court argued that Rivera did not take it upon herself to communicate with Mair, but rather she spoke with Mair at SVRC's request. Therefore, she was not an "initiator," the court ruled.

The court also determined that Rivera did not present any new information to Mair because of her previous communications with SVRC. Therefore, Rivera did not engage in protected activity under the WPA, the court ruled.

The panel went further to state that even if Rivera's communications were protected, the court would still rule in favor of SVRC because the plaintiff failed to show a connection between her communicating with Mair and her being laid off.

"Temporal proximity, without more, is insufficient to prove a causal connection between the protected activity and adverse employment action," the court wrote.

Attorney's comments

Piper said the published decision in this case is significant because it narrows the scope of McNeill-Marks v MidMichigan Center-Gratiot.

The court cited that case to state that under the WPA, "reporting" is defined as when a plaintiff makes a charge of illegality against an entity or makes known to a public body pertinent information related to illegality.

In this case, the court determined the plaintiff did not charge LS with illegal conduct.

Additionally, the court ruled that Mair was acting as an agent of SVRC. Therefore, the court wrote that when Rivera communicated with Mair, she was communicating with Mair's principal, SVRC. The court determined that is not protected activity under the WPA.

"We had to distinguish the McNeill-Marks case significantly from the facts of ours. I think our case was the right one for the COA to narrow their holding from the McNeill-Marks decision," Piper said.

Going forward, Piper said attorneys won't have to be as worried about communications with employees while representing employers.

"This case really narrows the McNeill-Marks decision, which is important for lawyers generally because now we don't have to be as cautious if you're an attorney representing the employer. You're an agent of the employer, so you don't have to be worried about employees coming to you," Piper said.

Plaintiff's attorney Russell Babcock did not respond to requests for comment on this case.

If you would like to comment on this story, email Thomas Franz at tfranz@mi.lawyersweekly.com.

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Title Annotation:Michigan Court of Appeals on Rivera v. SVRC Industries
Author:Franz, Thomas
Publication:Michigan Lawyers Weekly
Date:Apr 17, 2019
Words:1120
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