Case Title: Waite v. Moto One KTM, LLC

Citation: 

Docket Number: 47845

State: idaho

Court: Idaho Supreme Court (civil)

Date: 2021-07-19T00:00:00Z

Document:
1 
IN THE SUPREME COURT OF THE STATE OF IDAHO 
Docket No. 47845 
 
 
DOUGLAS M. WAITE, 
 
     Claimant-Appellant, 
 
v. 
 
MOTO ONE KTM, L.L.C., Employer; and 
IDAHO DEPARTMENT OF LABOR, 
 
     Respondents. 
_______________________________________ 
)
)
)
)
)
)
)
)
)
)
) 
Boise, May 2021 Term 
 
Opinion Filed: July 19, 2021 
 
Melanie Gagnepain, Clerk 
 
Appeal from the Idaho Industrial Commission. 
 
The decision of the Idaho Industrial Commission is affirmed. 
 
McConnell Wagner Sykes & Stacey, PLLC, Boise, for appellant. Chad M. 
Nicholson argued. 
 
Lawrence G. Wasden, Idaho Attorney General, Boise, for respondent Idaho 
Department of Labor. M. Scott Keim argued. 
 
_____________________ 
 
 
 
BRODY, Justice. 
Douglas M. Waite appeals from an Idaho Industrial Commission (“Commission”) decision 
requiring him to repay unemployment benefits he received, along with interest and penalties. Waite 
asserts the Commission’s determination that he willfully misstated a material fact for the purpose 
of obtaining unemployment benefits is not supported by substantial and competent evidence and 
is incorrect as a matter of law. Additionally, Waite argues the Commission erred, as a matter of 
law, when it concluded that Idaho Code section 72-1366(12) requires him to repay the 
unemployment benefits he received. Waite timely appealed to this Court. For the reasons set forth 
below, we affirm the Commission’s decision and order. 
I. 
FACTUAL AND PROCEDURAL BACKGROUND 
Waite was employed by Moto One KTM, L.L.C., (“Moto One”) for 16 months. During 
 
2 
that time, a co-worker ignited a firecracker near Waite, resulting in an injury to his ears. Waite 
took time off to recuperate, but he returned to work several days later. After he returned to work, 
the situation between Waite and the co-worker deteriorated. According to Waite, the co-worker 
would intentionally play loud music, make loud noises, slam papers, and speak loudly. Waite 
informed the co-worker that he was sensitive to loud noises due to the injury to his ears, and that 
the co-worker’s actions were aggravating the problem. Waite also addressed his concerns with 
Andy Wilch, the owner of Moto One. Nevertheless, the situation between Waite and the co-worker 
did not improve. 
A few weeks later, the co-worker allegedly shouted “good morning” to Waite, knowing 
that Waite was sensitive to loud noises. In response, Waite shoved the co-worker. Waite and the 
co-worker also yelled at each other, and a physical altercation ensued, which disrupted the 
workplace. Consequently, the police were called and a police report was generated. After 
investigating the incident between Waite and the co-worker, Wilch informed Waite that “he cannot 
get in fights at work, and that he cannot work for him anymore.” Waite asserts that Wilch advised 
him to apply for unemployment benefits and report a lack of work as the reason for his separation.  
When Waite filed his application for unemployment benefits, he reported “layoff due to 
lack of work” as the reason for his separation. Moto One notified the Department of Labor 
(“Department”) four months later, however, that Waite had been discharged for cause. Moreover, 
Moto One provided supporting documentation that included a police report indicating Waite was 
involved in a physical altercation with his co-worker. Moto One also provided a copy of a charge 
of discrimination that Waite had filed with the Idaho Human Rights Commission, in which Waite 
stated several times that his employment with Moto One was terminated. For example, Waite 
stated: “I was discriminated against because of my disability, was subjected to a hostile work 
environment based on my disability, and in retaliation for requesting accommodations. As a result, 
my employment was wrongfully terminated.” Similar language is used elsewhere in the charge of 
discrimination. 
Waite contends that, at the time of his separation, he understood that Moto One was laying 
him off to give him time to “reset” and recuperate from the injury to his ears. The owner of Moto 
One informed the Department, however, that Waite had been discharged for engaging in a physical 
altercation with a co-worker. After conducting an investigation, the Department issued an 
eligibility determination denying benefits. The Department also issued an overpayment 
 
3 
determination identifying a $6,987.00 overpayment and a $1,746.75 penalty. 
Waite appealed the eligibility and overpayment determinations to the Department’s 
Appeals Bureau. The appeals examiner determined, inter alia, that Waite: (1) was discharged for 
employment-related misconduct; (2) “willfully made false statements or willfully failed to report 
material facts in order to receive unemployment benefits”; and (3) must repay the benefits to which 
he was not entitled. 
Waite timely appealed to the Commission, which issued a decision and order. First, the 
Commission determined that Waite had been discharged by Moto One for engaging in a physical 
altercation with a co-worker. The Commission also determined, however, that Moto One failed to 
show that Waite had engaged in employment-related misconduct. Thus, the Commission 
concluded that Waite was eligible for unemployment benefits as a result of his separation. Next, 
the Commission concluded that Waite “willfully misstated a material fact for the purpose of 
obtaining unemployment benefits when he misreported the reason for his separation.” Finally, the 
Commission concluded that, because Waite willfully misstated a material fact for the purpose of 
obtaining benefits, he must repay the unemployment benefits he received, along with interest and 
penalties.  
Waite filed a request for reconsideration, arguing the Commission erred when it concluded: 
(1) he willfully misstated a material fact for the purpose of obtaining unemployment benefits; and 
(2) he must repay the benefits he received, as well as a penalty. The Commission rejected Waite’s 
arguments and issued an order denying his request. Waite timely appealed to this Court. 
II. 
STANDARD OF REVIEW 
“This Court upholds decisions of the Industrial Commission unless (1) the Commission 
has acted without jurisdiction or in excess of its powers; (2) the Commission’s findings of fact are 
not based on substantial and competent evidence; (3) the findings of fact, order or award were 
procured by fraud; (4) as a matter of law, the findings of fact do not support the order or award.” 
Wittkopf v. Stewart’s Firefighter Food Catering, Inc., ___ Idaho ___, ___, 481 P.3d 751, 754 
(2021) (quoting Locker v. How Soel, Inc., 151 Idaho 696, 699, 263 P.3d 750, 753 (2011)). “When 
this Court reviews a decision from the Industrial Commission, we exercise free review over 
questions of law, but review questions of fact only to determine whether the Commission’s 
findings are supported by substantial and competent evidence.” Woolley v. Bridge St., Inc., 166 
Idaho 559, ___, 462 P.3d 87, 90 (2020) (quoting Current v. Wada Farms P’ship, 162 Idaho 894, 
 
4 
898, 407 P.3d 208, 212 (2017)). “Substantial evidence is more than a scintilla of proof, but less 
than a preponderance. It is relevant evidence that a reasonable mind might accept to support a 
conclusion.” Christy v. Grasmick Produce, 162 Idaho 199, 201–02, 395 P.3d 819, 821–22 (2017) 
(quoting Jensen v. City of Pocatello, 135 Idaho 406, 412, 18 P.3d 211, 217 (2000)). “Because the 
Commission is the fact finder, its conclusions on the credibility and weight of the evidence will 
not be disturbed on appeal unless they are clearly erroneous.” Ehrlich v. DelRay Maughan, M.D., 
P.L.L.C., 165 Idaho 80, 83, 438 P.3d 777, 780 (2019) (quoting Christy, 162 Idaho at 201, 395 P.3d 
at 821). All facts and inferences are viewed in a light most favorable to the party who prevailed 
before the Commission. Woolley, 166 Idaho at ___, 462 P.3d at 90 (quoting Ehrlich, 165 Idaho at 
83, 438 P.3d at 780). 
III. 
ANALYSIS 
A. The Commission’s determination that Waite willfully made a false statement in 
order to obtain unemployment benefits is supported by substantial and competent 
evidence. 
Waite asserts the Commission’s determination that he willfully misrepresented a material 
fact for the purpose of obtaining unemployment benefits is not supported by substantial and 
competent evidence. He contends that any misstatement he made was not willful because he 
merely misunderstood the answer choices that were available on the application for unemployment 
benefits: “Waite had not been told that he had been ‘Fired.’ Therefore, Waite’s (arguably mistaken) 
belief that the ‘Fired/Discharged’ [answer choice] was inapplicable to his situation left Waite with 
just one choice: ‘Layoff Due to Lack of Work.’ ” Consequently, Waite asserts the evidence 
supports only a finding that he selected “layoff due to lack of work” because of a 
misunderstanding. We disagree. 
“The term ‘willfully’ refers to those claimants who ‘purposely, intentionally, consciously, 
or knowingly fail to report a material fact [or make a false statement], not those whose omission 
[or false statement] is accidental because of negligence, misunderstanding or other cause.’ ” 
Bringman v. New Albertsons, Inc., 157 Idaho 71, 76, 334 P.3d 262, 267 (2014) (alterations in 
original) (quoting Cox v. Hollow Leg Pub & Brewery, 144 Idaho 154, 157, 158 P.3d 930, 933 
(2007)). Willfulness does not require an intent to violate the law. Id. 
 
When this Court reviews a question of fact, it must determine whether there is substantial 
and competent evidence to support the Commission’s findings. Wittkopf v. Stewart’s Firefighter 
Food Catering, Inc., ___ Idaho ___, ___, 481 P.3d 751, 754 (2021) (quoting Locker v. How Soel, 
 
5 
Inc., 151 Idaho 696, 699, 263 P.3d 750, 753 (2011)). “Substantial and competent evidence is 
relevant evidence that a reasonable mind might accept to support a conclusion.” Id. This Court will 
not disturb the Commission’s conclusions concerning the credibility and weight of the evidence 
unless they are clearly erroneous. Id. 
 
Here, the Commission concluded that Waite willfully made a false statement when he 
reported he was laid off due to a lack of work. The Commission summarized its reasoning as 
follows: 
[Waite] reported that he was laid off due to lack of work rather than discharged. 
[Waite] explained that he believed he was laid off due to a lack of work because 
[Moto One] would not be accommodating his noise sensitivity disability. The 
Commission was not persuaded by this testimony and did not find other evidence 
that [Moto One] was contemplating [Waite’s] separation prior to his altercation 
with his co-worker, and this timeline supports [Moto One’s] version of events. 
Because [Waite] has not provided evidence that corroborates his version of events, 
it follows that [Waite] should not have reported he was laid off due to lack of work. 
 
The Commission’s conclusion that Waite willfully made a false statement in order to obtain 
unemployment benefits is supported by substantial and competent evidence. That evidence 
includes a police report indicating that Waite engaged in a physical altercation with a co-worker 
shortly before his separation. After investigating the altercation, the owner of Moto One informed 
Waite that “he cannot get in fights at work, and that he cannot work for him anymore.” These facts 
support the Commission’s conclusion that Waite was discharged for engaging in a physical 
altercation with his co-worker. Additionally, Waite subsequently filed a charge of discrimination 
with the Idaho Human Rights Commission and expressly stated that Moto One had terminated his 
employment. This fact also supports the Commission’s conclusion that Waite was discharged—as 
opposed to being laid off due to a lack of work. This fact also calls into question Waite’s veracity. 
That is a question for the finder of fact, of course, but Waite’s contradictory statements to the 
Department and the Idaho Human Rights Commission are concerning. 
Waite maintains that he believed Moto One had laid him off to give him time to “reset” 
and care for his ears. The Commission did not find Waite’s testimony persuasive, however, noting 
there was no evidence to suggest Moto One was contemplating the possibility of laying off Waite 
prior to the physical altercation with the co-worker. Moreover, Waite did not provide evidence to 
corroborate his version of events. 
As this Court has stated, “willfulness is found where a claimant ‘was properly informed of 
his reporting obligation and his alleged misunderstanding lacked credibility.’ ” Current v. Wada 
 
6 
Farms P’ship, 162 Idaho 894, 899, 407 P.3d 208, 213 (2017) (quoting Bringman, 157 Idaho at 77, 
334 P.3d at 268). Here, Waite was informed of his obligations and responsibilities when he applied 
for unemployment benefits, including his obligation to accurately report the reason for his 
separation from employment. Further, the Commission found that Waite’s explanation for the false 
statement on his application was not persuasive or credible. 
 In sum, there is substantial and competent evidence to support the Commission’s 
determination that Waite willfully made a false statement when he reported he was laid off due to 
a lack of work. The Commission’s conclusions concerning the credibility and weight of the 
evidence are not clearly erroneous. Thus, we affirm the Commission’s determination. 
B. The Commission did not err when it concluded as a matter of law that Waite 
willfully made a false statement in order to obtain unemployment benefits. 
Waite asserts the Commission erred, as a matter of law, when it concluded he misstated a 
material fact for the purpose of obtaining unemployment benefits. Waite argues that his selection 
of “lay off due to lack of work” instead of “fired/discharged” on his application for unemployment 
benefits was immaterial because, under either scenario, he would merely need to show that Moto 
One made the decision to end his employment. Even if Waite had selected “fired/discharged” on 
his application, he would have been eligible for unemployment benefits unless Moto One could 
have demonstrated that Waite was discharged for employment-related misconduct. Therefore, 
Waite argues that his statement indicating he was laid off due to a lack of work was not a material 
fact, and the Commission erred when it ruled otherwise. We disagree. 
A claimant for unemployment benefits must provide “all necessary information pertinent 
to eligibility.” I.C. § 72–1366(1). Further, a claimant is not entitled to unemployment benefits if 
“he was discharged for misconduct in connection with his employment.” I.C. § 72-1366(5). Under 
Idaho Code section 72-1366(12), “[a] claimant shall not be entitled to benefits for a period of fifty-
two (52) weeks if it is determined that he has willfully made a false statement or willfully failed 
to report a material fact in order to obtain benefits.” Moreover, “the claimant shall also . . . repay 
any sums received for any week for which the claimant received . . . benefits as a result of having 
willfully made a false statement or willfully failed to report a material fact.” I.C. § 72-1366(12). 
“A fact is material ‘if it is relevant to the determination of a claimant’s right to benefits; it need 
not actually affect the outcome of the determination.’ ” Current v. Haddons Fencing, Inc., 152 
Idaho 10, 13, 266 P.3d 485, 488 (2011) (quoting Meyer v. Skyline Mobile Homes, 99 Idaho 754, 
760, 589 P.2d 89, 95 (1979)). “[T]he test for materiality is relevance.” Bringman v. New 
 
7 
Albertsons, Inc., 157 Idaho 71, 75, 334 P.3d 262, 266 (2014). 
Here, Waite was required to report the reason for his separation on his application for 
unemployment benefits. There were two relevant answer choices available to Waite. The first 
choice stated: “Fired/Discharged – The employer decided to end the employment relationship, 
terminate, or dismiss you.” The second choice stated: “Layoff Due to Lack of Work – Your 
employer has no work available to you. This could be in the form of a seasonal slowdown, 
furlough, reduction in force, business closure, downsizing, or when a temporary job ends.” Waite 
reported he was laid off due to a lack of work. This fact, as reported by Waite, was relevant to the 
Department’s initial determination of Waite’s eligibility for unemployment benefits. Stated 
differently, the Department relied on this fact when it approved Waite’s unemployment benefits. 
If Waite had reported “Fired/Discharged” on his application for unemployment benefits—instead 
of “Layoff Due to Lack of Work”—the Department would have evaluated the circumstances 
surrounding Waite’s discharge prior to approving his application for benefits. It is possible the end 
result would have been the same, but the circumstances surrounding Waite’s discharge were 
undoubtedly relevant to the Department’s determination concerning Waite’s right to 
unemployment benefits. That information was necessary, for example, for the Department to 
determine whether Waite was discharged for employment-related misconduct. See I.C. § 72-
1366(5). 
Waite argues, in essence, that his false statement was not material because it did not 
ultimately affect his eligibility for benefits. Even if Waite’s false statement did not ultimately affect 
his eligibility for benefits, however, that does not alter our analysis. As this Court has stated, a 
material fact need not affect the outcome of an eligibility determination. Current, 152 Idaho at 13, 
266 P.3d at 488. A claimant may not misstate or withhold information even if an accurate and full 
disclosure of the facts would not affect the claimant’s right to receive unemployment benefits. 
Meyer, 99 Idaho at 760, 589 P.2d at 95 (citation omitted). “The [Department] should be able to 
assume that benefit claimants are reporting all the information solicited from them fully and 
accurately. A complete and unqualified disclosure can best be promoted by defining materiality to 
include any information that is relevant to the determination of a claimant’s right to benefits.” Id. 
Therefore, the definition of materiality is broadly inclusive. Bringman, 157 Idaho at 76, 334 P.3d 
at 267. 
Because the reason for Waite’s separation was relevant to the Department’s initial 
 
8 
determination concerning his right to unemployment benefits, his false statement concerns a 
material fact. See Current, 152 Idaho at 13, 266 P.3d at 488. Therefore, we hold that the 
Commission did not err as a matter of law when it concluded that Waite “willfully misstated a 
material fact for the purpose of obtaining unemployment benefits when he misrepresented the 
reason for his separation.” 
C. The Commission did not err when it concluded as a matter of law that Idaho Code 
section 72-1366(12) requires Waite to repay the unemployment benefits he 
received. 
Waite asserts the Commission’s conclusion that Idaho Code section 72-1366(12) mandates 
the repayment of the unemployment benefits he received is incorrect as a matter of law. Waite 
contends that “[t]he plain language of § 72-1366(12) demonstrates that the intent of the Legislature 
was to ‘penalize’ those who willfully make a false statement with a fifty-two (52) week period of 
ineligibility but that repayment of benefits is require [sic] where it is determined that the benefits 
were paid to a claimant because of the false statement or failure to report.” Waite argues that he 
did not receive unemployment benefits as a result of his false statement. Therefore, he asserts that 
the repayment requirement in Idaho Code section 72-1366(12) is inapplicable: 
In this case, even if it is determined that (1) Waite willfully made a false 
statement and (2) the false statement was with respect to a material fact, Waite did 
not receive benefits as a result of the statement. . . . [T]he undisputed evidence 
before the Commission was that the decision to end Waite’s employment was made 
by Moto One. If the termination had been deemed a layoff, Waite was entitled to 
receive benefits. If the termination had been deemed a discharge, Waite was entitled 
to benefits unless Moto One carried its burden of establishing that the discharge 
was for misconduct. 
(Emphasis in original.) Since Moto One did not carry its burden of demonstrating Waite’s 
discharge was for employment-related misconduct, Waite argues he “did not receive benefits as a 
result of the misstatement, [and] Idaho Code § 72-1366(12) does not mandate repayment of the 
benefits.” 
As discussed above, Idaho Code section 72-1366 requires a claimant to repay 
unemployment benefits received as a result of a false statement that was willfully made by the 
claimant to the Department: 
A claimant shall not be entitled to benefits for a period of fifty-two (52) 
weeks if it is determined that he has willfully made a false statement or willfully 
failed to report a material fact in order to obtain benefits. The period of 
disqualification shall commence the week the determination is issued. The claimant 
shall also be ineligible for waiting week credit and shall repay any sums received 
 
9 
for any week for which the claimant received waiting week credit or benefits as a 
result of having willfully made a false statement or willfully failed to report a 
material fact. The claimant shall also be ineligible for waiting week credit or 
benefits for any week in which he owes the department an overpayment, civil 
penalty, or interest resulting from a determination that he willfully made a false 
statement or willfully failed to report a material fact. 
I.C. § 72-1366(12). 
“The interpretation of a statute is a question of law over which this Court exercises free 
review.” Boyd-Davis v. Macomber Law, PLLC, 157 Idaho 949, 952, 342 P.3d 661, 664 (2015) 
(quoting Williams v. Blue Cross of Idaho, 151 Idaho 515, 521, 260 P.3d 1186, 1192 (2011)). 
“When interpreting a statute, the Court begins with the literal words of the statute, and where the 
language of a statute is plain and unambiguous, the Court gives effect to the statute as written, 
without engaging in statutory construction.” Id. “If the statute is not ambiguous, this Court does 
not construe it, but simply follows the law as written.” Verska v. Saint Alphonsus Reg’l Med. Ctr., 
151 Idaho 889, 893, 265 P.3d 502, 506 (2011) (quoting State v. Schwartz, 139 Idaho 360, 362, 79 
P.3d 719, 721 (2003)). 
Waite argues, in essence, that the third sentence of Idaho Code section 72-1366(12) (“The 
claimant shall also be ineligible for waiting week credit and shall repay any sums received for any 
week for which the claimant received waiting week credit or benefits as a result of having willfully 
made a false statement or willfully failed to report a material fact.”) constitutes a separate penalty 
that is unconnected to the penalty delineated in the first sentence of the statute (“A claimant shall 
not be entitled to benefits for a period of fifty-two (52) weeks if it is determined that he has willfully 
made a false statement or willfully failed to report a material fact in order to obtain benefits.”). 
Waite does not dispute that he is not entitled to unemployment benefits for a period of 52 weeks 
if he willfully made a false statement or willfully failed to report a material fact in order to obtain 
benefits. He argues, however, that the repayment penalty set forth in the third sentence of Idaho 
Code section 72-1366(12) is inapplicable because he did not receive unemployment benefits “as a 
result of” his false statement. We disagree. 
First, we note that the third sentence of Idaho Code section 72-1366(12) begins by stating: 
“The claimant shall also . . . repay any sums received . . . .” (Emphasis added.) Thus, this sentence 
is expressly linked to the first two sentences of the statute. If a claimant willfully makes a false 
statement or willfully fails to report a material fact in order to obtain benefits, he is not eligible for 
benefits for 52 weeks and, also, must repay any benefits received. I.C. § 72-1366(12). In other 
 
10 
words, the statute must be read as a whole. See Ada Cnty. Highway Dist. v. Brooke View, Inc., 162 
Idaho 138, 142, 395 P.3d 357, 361 (2017) (“This Court considers the statute as a whole . . . .”). 
When viewed in that light, Waite’s argument that the third sentence of Idaho Code section 72-
1366(12) is unconnected to the first part of the statute is unpersuasive. 
Second, even if the third sentence of Idaho Code section 72-1366(12) is viewed in isolation, 
Waite’s argument that he did not receive unemployment benefits “as a result of” his false statement 
is unavailing. As this Court recently explained, the meaning of the phrase “as a result of” is not 
always clear. Schoeffel v. Thorne Rsch., Inc., 167 Idaho 633, ___, 474 P.3d 705, 709 (2020) (stating 
that reasonable minds may differ about the meaning of the phrase in some instances). “There are 
several different kinds of causation, so there are several different ways that this phrase could be 
interpreted.” Id. (citing Husted v. A. Philip Randolph Inst., 138 S. Ct. 1833 (2018)). Therefore, 
courts look to the context of the statute to determine the type of causation required. Husted, 138 
S. Ct. at 1842 (citing Holmes v. Sec. Inv. Prot. Corp., 503 U.S. 258, 265–268 (1992)). Here, the 
meaning of the phrase “as a result of” in Idaho Code section 72-1366(12) is plain and unambiguous 
based on the context of the statute. The phrase “as a result of” is simply another way of saying 
“because of.” Cf. Husted, 138 S. Ct. at 1842 (quoting Christine Ammer, American Heritage 
Dictionary of Idioms 67 (2d ed. 2013)) (stating the phrase “by reason of” is a formal way of saying 
“because of”). Because the meaning of the phrase “as a result of” in Idaho Code section 72-
1366(12) is plain and unambiguous, this Court is compelled to follow the statute as written. Verska, 
151 Idaho at 893, 265 P.3d at 506. 
 
Here, Waite willfully made a false statement on his application for unemployment benefits 
when he indicated he was laid off due to a lack of work. Moreover, the Department relied on 
Waite’s false statement when it initially approved his application for unemployment benefits. 
Stated differently, the Department approved Waite’s application for unemployment benefits 
because of his false statement. As the Commission noted, Waite’s “overpayment in this case was 
the result of a false statement or failure to report a material fact.” The fact that Waite may have 
qualified for unemployment benefits if he had reported “fired/discharged” as the reason for his 
separation does not alter the analysis under Idaho Code section 72-1366(12). That observation 
does not change the fact that the Department initially approved Waite’s application for 
unemployment benefits as a result of his false statement. Thus, under Idaho Code section 72-
1366(12), Waite must “repay any sums received for any week for which [he] received . . . benefits 
 
11 
as a result of having willfully made a false statement . . . .” Accordingly, we hold that the 
Commission did not err when it concluded as a matter of law that Idaho Code section 72-1366(12) 
requires Waite to repay the unemployment benefits he received. 
IV. 
CONCLUSION 
Based on the foregoing, we affirm the Commission’s decision and order. Costs on appeal 
are awarded to the Department pursuant to Idaho Appellate Rule 40. 
Chief Justice BEVAN, and Justices BURDICK, STEGNER, and MOELLER CONCUR.