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declining to exercise supplemental jurisdiction over state law counterclaims after disposing of federal claim on summary judgment
Summary of this case from Hatfield v. Cottages on 78th Cmty. Ass'nOpinion
Case No. 1:03CV57DAK.
May 12, 2005
MEMORANDUM DECISION AND ORDER
This matter is before the court on Defendants Davis School District, Dr. Darrell K. White, Lynn Trenbeath, Gary Payne, John Swain, Mel Miles, Leon Webster, and Dale May's Motion for Summary Judgment and Motion to Strike. The court held a hearing on the motion on April 13, 2005. Plaintiff was represented by Vincent C. Rampton, and Defendants were represented by Glen E. Davies. After the hearing on the matter, the parties each briefed issues relating to the Utah Governmental Immunity Act that were raised by Defendants at trial. Having fully considered the motions and memoranda submitted by the parties and the facts and law relevant to this motion, the court enters the following Memorandum Decision and Order.
BACKGROUND
Plaintiff was employed by Defendant Davis School District from 1982 until March 2003. Plaintiff held various positions in the District's Maintenance Department. From 1998 until his termination March 31, 2003, Plaintiff was a coordinator/supervisor in the Maintenance Department. In his position as Maintenance Coordinator, Plaintiff had supervisory responsibility over electrical, pumps and appliances, and motors and refrigeration operations at all District-owned facilities. He supervised the activities of three foremen, each of whom performed or supervised the performance of maintenance work on the facilities. Plaintiff's position did not involve actual maintenance work. Plaintiff states that he received no formal training in his responsibilities as Maintenance Coordinator.
Full-time District employees are employed under the terms of the 9CA Classified Employees' Agreement. As a supervisor under the Classified Agreement, Plaintiff was a salaried employee and was not entitled to overtime. Instead of overtime, Plaintiff could accrue comp time on an "hour for hour" basis. The District asserts that even salaried employees were required to maintain time cards in order to keep track of their comp time. Plaintiff asserts that because he kept his cell phone on at all times and responded to calls on an as needed basis that, "at a certain point," he "concluded that he was a `first responder,' on duty at all hours of the day or night, during all days of the week" and he ceased tracking or claiming time.
While he was employed with the district, Plaintiff also owned and operated an electrical contracting business. It was permissible for District employees to hold employment outside of the District as long as the work was done on the employee's own time.
District supervisory personnel heard rumors that Oman was conducting his private contracting business during normal work hours. In the spring of 2002, Lynn Trenbeath, the District Assistant Superintendent, who was in charge of the Maintenance Department, spoke to Dale May, the District Security Coordinator about hiring a private detective to follow Oman during the weekday. May recommended Joe Morrison, a Layton City Police Department Detective. May met with Morrison regarding the rumors and the possibility of hiring him as a private investigator. Morrison stated he would need to check with his Chief. The Chief notified Trenbeath that the Layton City Police would be willing to do the investigation because if the rumors proved to be true, there could be probable cause for criminal charges.
As part of the investigation, Morrison placed a global positioning satellite ("GPS") tracking device on the district vehicle Plaintiff routinely used and tracked the vehicle's movements over a period of months. Morrison also conducted personal surveillance on Plaintiff's activities for two months. Morrison's log of Plaintiff's activities indicates that other than morning hours when Plaintiff would arrive at the maintenance shop and make assignments for his crews, Plaintiff sent little or no time engaging in District business. He spent time at his residence, in his personal vehicle visiting job sites for his contracting business, and at other locations unrelated to District business.
Plaintiff does not appear to dispute the accuracy of Morrison's report. However, he emphasizes that he had a cellular telephone that allowed him to be contacted at any time. He states that he could conduct his job over the telephone and there is no evidence that he was not completing the requirements of his job. He also states that he had lost two of the employees who had worked for his private contracting business during that time and was doing more of their work than usual.
Morrison turned over his information to the Davis County Attorney. The County Attorney decided to charge Plaintiff with communications fraud. On June 27, 2002, Morrison met with Plaintiff at the District maintenance shops and served him with a Summons and Bill of Information charging him with communications fraud. State criminal charges were brought against Plaintiff in Second Judicial District Court for Davis County, State of Utah, Case No. 021701067.
Also on June 27, 2002, the District delivered a letter to Plaintiff suspending him with pay pending investigation of the criminal charges against him and advising him of his right to request a hearing with respect to the suspension in accordance with the terms of the Classified Agreement. The letter also invited Plaintiff to meet with District personnel the following day to discuss issues regarding his suspension. Plaintiff declined to meet with District personnel the following day because he needed to retain counsel. Five days later, the District advised Plaintiff that his suspension would be without pay.
The Classified Employees Agreement discusses termination during the contract term for: "(1) Unsatisfactory action or conduct" and "(2) Termination for Cause." Section 8.5.3. Under the unsatisfactory action or conduct prong, the Agreement states that "[t]he District may elect to proceed with disciplinary action to warn the employee that his/her conduct places the employee in danger of termination during the contract term or contract non-renewal." Several methods of discipline are included, such as oral reprimand, written reprimand, probation, and suspension. However, the Agreement states that "[t]he District may elect to exclude any or all of the following steps." Furthermore, it states that "[n]o disciplinary action shall prejudice the right of the District to proceed with the termination for cause on the same facts which gave rise to the disciplinary action." In its discussion of suspension, the Agreement provides that "[s]uspension may, among other reasons, be invoked by the District when further investigation is deemed necessary or desirable in order to make an informed decision concerning the employment of employee and/or when criminal charges may be relevant in determining the appropriate action with respect to the employee's continued employment."
With respect to the prong for "Termination of Contract for Cause," the Agreement provides that "[s]ufficient grounds for dismissal from employment of an employee are considered to be: (a) neglect of employment obligations; . . . (d) conviction of a felony in any state or federal court; (e) conviction in state or federal court of any crime that demonstrates moral turpitude . . . [or] (h) serious misconduct related to his/her job." The Agreement further provides notice requirements for termination of the contract as follows: "[a]t any time during the term of employment, the District may terminate an employee upon giving written notice by personal delivery or certified mail to the last known address stating that employment shall terminate at a time fifteen (15) days or more from the date of notice, and stating the detailed reasons and evidence supporting such reasons." Section 8.5.4(2).
Under the Agreement, "[i]n all suspensions or terminations pursuant to this section, the career employee shall be entitled to a hearing as provided in Section 8.7. The employee shall be paid for the full period of suspension if reinstated by the Board of Education." Section 8.5.5. Under Section 8.7, "[a] classified employee who is entitled to a hearing by the Superintendent of Schools or his/her designee shall file a written request for a hearing with the Superintendent not later than ten (10) working days after his/her receipt of notice of termination. Failure to file a timely request shall be deemed a waiver of hearing." Section 8.7.1.
On July 2, 2002, Plaintiff was placed on suspension without pay. Plaintiff requested a hearing and the pre-hearing conference was held on August 16, 2002. Plaintiff and his attorney attended. Plainitff's attorney made the entire presentation. At the conclusion of the pre-hearing conference, the Superintendent's designee sustained the decision to suspend Plaintiff without pay. Oman's attorney then requested a formal hearing before the Board. Brian Florence was mutually selected as the hearing examiner, and the hearing was tentatively set for October 18, 2002. Although the hearing was scheduled and rescheduled several times, it was never held.
In the criminal matter, a preliminary hearing was held on November 4, 2002, before the Honorable Michael Allphin. At the conclusion of the evidence, Judge Allphin bound the case over for trial. The attorneys negotiated a plea bargain. The Davis County Attorney's Office agreed to drop the felony charge to a misdemeanor and offered a plea to be held in abeyance. Plaintiff declined to sign the plea in abeyance because it admitted guilt. Upon the advice of counsel, Plaintiff agreed to sign the plea in abeyance if all references to guilt could be converted to "no contest," which was done. Plaintiff's counsel assured him that his plea would not be admissible in a subsequent civil proceeding.
On December 5, 2002, Plaintiff pleaded no contest to the charge of attempted communications fraud, a Class A misdemeanor. The plea was held in abeyance under the terms of the plea agreement. Plaintiff executed a Statement in support of the plea. Plaintiff acknowledged in the Statement, that he understood "that by pleading no contest I will be admitting that I committed the crimes listed above."
On March 11, 2003, the District sent Plaintiff a letter terminating his employment in 15 days. Under an Agreement, dated April 25, 2003, entitled Agreement of Waiver of Claims and Defenses, Plaintiff withdrew his request for an administrative hearing in connection with his suspension and/or termination as a District employee and agreed that as a consequence of such withdrawal, he would not assert any claim for denial of due process or other legal or equitable claim by reason of the District having failed to give him a post-suspension or post-termination administrative hearing.
Plaintiff filed this action seeking recovery under 42 U.S.C. § 1983, breach of contract, breach of implied covenant of good faith and fair dealing, Utah's Orderly School Termination Procedures Act, defamation, and intentional infliction of emotional distress. The Davis School District filed a Counterclaim against Plaintiff seeking recovery for breach of contract, breach of the implied covenant of good faith and fair dealing, conversion, unjust enrichment, and fraud.
DISCUSSION Defendants' Motion to Strike
Defendants seek to strike paragraphs 14 and 15 of the Affidavit Plaintiff submitted with his Memorandum in Opposition to Defendant's Motion for Summary Judgment because they constitute double hearsay. Paragraphs 14 and 15 are statements allegedly made by Michael DiReda, Davis County Attorney, to Plaintiff's counsel Mr. Sharp. Plaintiff argues that they contain Plaintiff's counsel's perception of DiReda's motives immediately after hearing them and in the course of plea negotiations and they should be admissible as a present sense impression under Rule 803(1) of the Federal Rules of Evidence.
Oman does not lay any foundation that he was present during the conversation and, therefore, he cannot make the statements based on personal knowledge. Under Rule 56(e) of the Federal Rules of Civil Procedure, an affidavit must be "made on personal knowledge." Because Plaintiff does not have personal knowledge of what happened at the meeting, the statements are not Plaintiff's present sense impression. Plaintiff received his information from individuals who were at the meeting. Therefore, the Affidavit contains double hearsay. Hearsay testimony is not appropriate under Rule 803 of the Federal Rules of Evidence. Moreover, under Rule 602 of the Federal Rules of Evidence, an affiant is not competent to testify with regard to matters of which he has no personal knowledge. For these reasons, courts have uniformly held that affidavits based upon inadmissible hearsay should be disregarded in reviewing a motion for summary judgment. Thomas v. Internation Business machines, 48 F.3d 478, 485 (10th Cir. 1995).
Although Plaintiff seeks an opportunity to submit an affidavit directly from Mr. Sharp, the court does not believe the evidence is relevant to the issue before the court. Therefore, the Motion to Strike is granted. Defendants also seek to strike paragraphs 6-10, 14, and 15 from the Affidavit Plaintiff submitted with his Memorandum In Opposition to Defendants' Motion for Summary Judgment. However, because Plaintiff relies on the statements contained in these paragraphs to support his defamation claim and the court declines to exercise supplemental jurisdiction over Plaintiff's state law claims, this portion of Defendants' Motion to Strike is moot.
Defendant's Motion for Summary Judgment
I. Section 1983 Due Process Claim
Defendants seek to dismiss Plaintiff's First Claim for Relief under 42 U.S.C. Section 1983 for deprivation of due process. The parties agree that Plaintiff was entitled to due process in his termination. However, they dispute the nature of the due process to which he was entitled and whether he was provided whatever level of process he was due.
In Cleveland Board of Education v. Loudermill, 470 U.S. 532, 542 (*1985), the Court noted that "an essential principle of due process is that a deprivation of life, liberty, or property be preceded by notice and an opportunity for hearing appropriate to the nature of the case." Typically, "the tenured public employee is entitled to oral or written notice of the charges against him, and an explanation of the employer's evidence, and an opportunity to present his side of the story." Id. at 546. However, due process is "flexible and calls for such procedural protections as the particular situation demands." Gilbert v. Homar, 520 U.S. 924, 930 (1997).
In this case, Defendants had heard several reports and rumors regarding Plaintiff's activities during the work day. The investigation into those reports ultimately became a police investigation and Plaintiff was charged with communications fraud, a second degree felony. On the same day that Plaintiff was criminally charged, he received a notice of suspension from the District. The District's notice of suspension to Plaintiff states the basis for suspension and Plaintiff's right to demand a hearing. Plaintiff did not choose to meet with the Human Resources Department the next day, and a few days later his suspension was changed to a suspension without pay. Plaintiff's counsel, however, requested a hearing and his hearing was held August 16, 2002. After the August 16, 2002 hearing, Plaintiff's counsel requested a hearing before the Board.
In the suspension letter given to Plaintiff on June 27, 2002, the District notified him that the actions resulting in his suspension could also form the basis for termination for cause. Under the Classified Agreement, even if the criminal charges were resolved in Plaintiff's favor, the District could still terminate him for cause based on the same facts. Plaintiff was notified of this possibility in the June 27, 2002 suspension letter. Before Plaintiff was terminated for cause, he was given several opportunities to explain himself. Oman withdrew his request for a pre-termination hearing and also agreed to waive his post-termination hearing.
Plaintiff argues that the District improperly focuses on only two points in time — the June 27, 2002 suspension and the March 11, 2003 termination. Plaintiff contends that he was entitled to more process at the outset of the investigation and before his suspension. In determining what process was due an employee who was suspended, the Supreme Court has stated that a court should consider three factors: "First, the private interests that will be affected by the official action; second, the risk of an erroneous deprivation of such interest through the procedures used and the probative value, if any, of additional or substitute procedural safeguards; and, finally, the government's interests." Gilbert v. Homar, 520 U.S. 924, 931-32 (1997).
In considering the three factors provided in the Gilbert decision, when the party's private interest is in a paycheck, due process is satisfied as long as the employee "receives a sufficiently prompt post suspension hearing." Id. at 933. Plaintiff asserts that his private interests include more than merely receiving a paycheck. Plaintiff contends that his good name, reputation and integrity were implicated when Defendants instigated a criminal investigation without consulting him on the matter. However, due process is not so broad that it requires notice of an investigation. Plaintiff cites to no case supporting the notion that an employer cannot investigate an employee's actions without first notifying the employee that the investigation is about to occur. In most instances, such a requirement would result in an ineffective and useless investigation.
Under the second factor, the court explained that the purpose of any pre-suspension hearing would be to assure that there are reasonable grounds to support suspension without pay. Id. The court recognized that when an employee is arrested and formally charged there is adequate assurance that suspension is justified. Id. at 933-34. "The arrest and formal charges imposed upon respondent `by an independent body demonstrate that the suspension is not arbitrary.'" Id. In this case, both the police department and district attorney's office, both independent bodies, reviewed the evidence and decided to bring formal charges against Plaintiff. Therefore, there is the same kind of assurance justifying suspension.
Plaintiff argues that the District's rush to suspend him rather than to use of other less severe disciplinary actions provided for in the Classified Agreement created a risk of erroneous deprivation. He contends that he was entitled to notice before the investigation and before the charges and suspension occurred. There is only one written concern in this regard in Plaintiff's personnel record and he claims that he adequately explained that situation. However, Plaintiff was not entitled to all of the progressive discipline steps identified in the Classified Employees Agreement. The Agreement states that the District has discretion in determining which of the disciplinary actions it decides to use. "The failure to comply with state or local procedural requirements does not necessarily constitute a denial of due process; the alleged violation must result in a procedure which itself falls short of standards derived from the Due Process Clause." Mangels v. Pena, 789 F.2d 836, 838 (10th Cir. 1986). The District complied with the procedures of the Classified Employees Agreement and, as stated above, the court does not believe that Plaintiff was required to notice that his actions were being investigated. Whether he was entitled to notice and a hearing before he was suspended is the three-step inquiry outlined in Gilbert.
As to the third factor — the government's interest — Plaintiff contends that the government had no protectable interest at stake. Plaintiff asserts that he was doing his job and his supervisor never claimed otherwise. He claims that he was not "stealing" his wages from the District and the District stood to lose nothing by conferring with Plaintiff before allowing a police investigation into his actions.
However, the State has a significant interest in suspending employees who occupy positions of public trust when felony charges are filed against them — "We think . . . that the government does not have to give an employee charged with a felony a paid leave at taxpayer expense." Gilbert, 520 U.S. at 932. In addition, Plaintiff repeatedly asserts that he did not do anything wrong because he was an exempt employee under the FLSA and he did not need to keep track of his hours. Plaintiff uses the language that, at a certain point, "he concluded he was a first-responder." Plaintiff did not seek input or advice from his supervisors on the issue. Rather, he unilaterally decided to discontinue keeping records of comp time. Requiring salaried employees to keep track of hours for comp time or to work a specified schedule does not violate the FLSA. Public employees are also subject to the principles of public accountability. In this case, Plaintiff was required to maintain time cards predicated upon an eight-hour workday. For time worked in excess of eight hours he could accrue comp time. Plaintiff initially operated under this system and took comp time for absences from work. Therefore, Plaintiff clearly understood how the system worked. During the two months that Morrison conducted surveillance on Plaintiff, he continued to turn in time cards reporting eight hours worked on District business each day, even though most of his days were spent at worksites for his own personal contracting business. It is disingenuous for Plaintiff to argue that as long as he had his cell phone with him, he was still working for the District. Plaintiff's representations to the District regarding his work hours provided a sufficient basis for termination for cause.
The court concludes that based on the three factors provided in Gilbert, Plaintiff was not entitled to notice and a hearing before he was suspended. The private and public interests involved are equal and the risk of improper action weighs in favor of the District because an independent party found adequate evidence to bring charges against Plaintiff based on his activities. Plaintiff was allowed to have post-suspension hearing. The court concludes that the due process provided to Plaintiff with respect to his suspension was adequate.
Furthermore, Plaintiff waived any issue regarding the process surrounding his termination — he did not seek a hearing and entered an agreement with the District regarding due process. Moreover, the District waited until after Plaintiff's no contest plea was entered before it decided to terminate him. The court concludes that Plaintiff received adequate due process. Therefore, Defendant's motion for summary judgment is granted and Plaintiff's claim for a violation of his due process rights is dismissed.
II. State Law Claims and Counterclaims
Plaintiff has asserted several other state law claims against Defendants. Defendants also have Counterclaims against Plaintiff for breach of contract, breach of the implied covenant of good faith and fair dealing, conversion, unjust enrichment, and fraud, which are all based on state law. Because the court has only supplemental jurisdiction over these remaining state law claims, the court concludes it would be proper to decline to exercise supplemental jurisdiction. The parties can use any discovery already obtained and any pretrial materials in a future state court proceeding. See Huntsinger v. Board of Directors of E-470 Public Hwy. Auth., 35 Fed. Appx. 749, 759-60, 2002 WL 853497, *10 (10th Cir. 2002). Therefore, the court declines to exercise supplemental jurisdiction over the state law claims and dismisses Plaintiff's remaining state law claims and Defendants' remaining state law counterclaims without prejudice to be brought in state court.
CONCLUSION
Based upon the above reasoning, Defendants' Motion to Strike is GRANTED IN PART AND MOOT IN PART. Defendants' Motion for Summary Judgment is GRANTED with respect to Plaintiff's Due Process Claim. Because the only remaining claims and counterclaims in this action are based on state law, the court declines to exercise supplemental jurisdiction over such claims. Therefore, Plaintiff's due process claim is dismissed with prejudice and the parties' remaining claims and counterclaims are dismissed without prejudice to be brought in state court.