Ferrick v. Santa Clara Univ., 231 Cal. App. 4th 1337, 181 Cal. Rptr. 3d 68 (2014)

Where an employee asserts a whistleblower claims based on allegations of supervisor misconduct, such allegations must be supported by sufficient facts implicating public policy, otherwise such whistleblower claims are not legally cognizable and must be dismissed as a matter of law.

The Factual Background

Plaintiff, a former senior administrator in Santa Clara University’s real estate department, charged her department director with extensive wrongdoing and inappropriate behavior. The director allegedly sent inappropriate emails, arrived late, took long lunches, failed to come into work, frequently drank alcohol on the job, and drove a university golf cart on campus after his driver’s license has been suspended. Plaintiff also allegedly witnessed other illegal conduct by the director, including embezzlement, bribery, and misdirection of public monies. She alleged that the director made false statements in real estate deals, evaded taxes by using on-campus housing, and engaged in elaborate kickback schemes. Plaintiff only reported some of this misconduct to Santa Clara University’s management.

Months after Plaintiff’s last complaint to management, she was eventually terminated by the University. Plaintiff filed a lawsuit on the basis of wrongful termination and whistleblower claims, both substantiated on violations of public policy, wherein the trial court dismissed her complaint without leave to amend, concluding that the claims of illegal conduct lacked factual support and that the complaint failed to allege that her discharge violated any fundamental public policy.

The Court of Appeals

The California Court of Appeals reversed finding a cause of action for termination in violation of public policy on a narrow basis, specifically that a wrongful discharge based on public policy comprises two distinct elements: 1) the public policy in question must be supported by either constitutional or statutory provisions; 2) the public policy must be relevant and otherwise further the public interest; 3) the public policy considerations must exist at the time of the employee’s discharge; and 4) the public policy must be fundamental and substantial in this regard.

The Court of Appeals reasoned that since most of the alleged violations of law in plaintiff’s complaint did not satisfy the public policy requirements necessary to assert a legally cognizable and valid wrongful discharge and whistleblower claims. The Court of Appeals did recognize that plaintiff had sufficiently stated a claim regarding the employee’s allegations involving a kickback scheme, and there was a strong public policy interest in preventing such conduct, especially where there was strong evidence that the director accepted a payment in return for using his position as a university employee to place Santa Clara tenants with a private landlord, essentially the basis of which the employee had complained about.

This case is significant in that it evaluated the scope of the meaning of public policy based justifications by which a terminated employee may rightfully assert claims of whistleblower and wrongful discharge claims. Here, the Court applied a very specific set of legal tests in determining whether or not there was in fact public policy justifications to determine whether an employee’s’ discharge was wrongful and otherwise afforded the protection of whistleblower laws.

Employment based claims involving a large employer requires a law firm that is experienced, competent, and knowledgeable concerning the complexities of employment claims pursuant to both state and federal whistleblower laws. If you have any employment-related dispute and are considering suing your employer for discriminatory conduct contact the Orange County Employment Lawyers at Nassiri Law Group, practicing in Orange County, Riverside, and Los Angeles. Call (949) 375-4734.