Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca10-85-01467/USCOURTS-ca10-85-01467-0/pdf.json

Parties Involved:
Hewlett Packard Company
Appellee
Roger D. Smith
Appellant

Document Text:

, 

UNITED STATES COURT OF APPEALS 

TENTH CIRCUIT 

ROGER D. SMITH, 

Plaintiff-Appellant, 

F ILED 

United St.ata CIOurt of Appeals 

Tenth Circ11it 

FEB 2 91988 

ROBERT L. HOECKER 

Clerk 

v. 

HEWLETT PACKARD COMPANY, 

a California Corporation, 

No. 85-1467 

(D.C. No. 83-M-2180) 

(District of Colo.) 

Defendant-Appellee. 

ORDER AND JUDGMENT 

Before McKAY, ANDERSON, and TACHA, Circuit Judges. 

After examining the briefs and appellate record, this panel 

has determined unanimously that oral argument would not materially 

assist the determination of this appeal. See Fed. R. App. P. 

34(a); 10th Cir. R. 34.1.8. The cause is therefore ordered submitted without oral argument. 

Roger D. Smith (plaintiff) was employed by Hewlett Packard 

Company (HP) from January 29, 1979, to March 22, 1983, at HP's 

facility in Fort Collins, Colorado. In early March of 1983, an HP 

employee, Mr. Graham, gave HP representatives some tapes of 

recorded conversations between Mr. Graham and plaintiff that 

implicated plaintiff in the theft of HP equipment and labor. On 

Appellate Case: 85-1467 Document: 010110028289 Date Filed: 02/29/1988 Page: 1 
the basis of information obtained from the tapes, HP began to 

investigate plaintiff's conduct. At the conclusion of the investigation, plaintiff was asked to meet with HP representatives. At 

this meeting HP orally advised1 plaintiff of the allegations 

against him and asked plaintiff various questions about the misappropriated equipment and labor. At the end of the meeting, 

plaintiff was told that he was discharged. Plaintiff was then 

given his termination papers and paycheck and was escorted from 

the building. 

Subsequently, plaintiff filed an action against HP which 

principally alleged that his discharge was wrongful because HP had 

breached "an implied contract of employment as set forth in past 

dealings with the company, and [HP's] Personnel Policies and 

Guidelines Manual [the Manual]." Record, vol. 2, at 2. Plaintiff 

also alleged that his conversations were wiretapped in violation 

of Colorado and federal law, that HP's use of the illegally taped 

conversations violated 18 U.S.C. § 2511 (1982) and 47 U.S.C. § 605 

(1982), and that HP's conduct during the investigation and termination was in reckless disregard of plaintiff's emotional wellbeing. HP filed a motion for summary judgment on all claims. The 

district court granted HP's motion, ruling that the Manual did not 

create any definite termination rights and that HP had not used 

illegal wiretaps nor engaged in reckless or outrageous conduct. 

1 About a month later, plaintiff was presented with a written 

summary of the charges against him. Record, vol. 2, app. H. 

-2-

Appellate Case: 85-1467 Document: 010110028289 Date Filed: 02/29/1988 Page: 2 
, 

Plaintiff appeals the granting of summary judgment on the issues 

of breach of implied contract and violation of federal wiretapping 

laws. Summary judgment on the issues of illegal wiretapping under 

Colorado law and outrageous conduct is not challenged. 

I. Breach of Implied Contract 

When considering the district court's entry of summary judgment against plaintiff's claim of implied contract, we apply a de 

novo review. Wheeler v. Hurdman, 825 F.2d 257, 260 (10th Cir.), 

cert. denied, 108 S. Ct. 503 (1987). Whether summary judgment was 

proper turns on the legal questions of whether HP's Manual creates 

an implied contract of employment that entitles an at-will 

employee to enforce termination procedures found in the Manual, 

and whether HP's conduct of promoting employee fairness creates an 

implied contract to use good faith and fair dealing in terminating 

an employee. 

The general rule in Colorado is that an employee hired "for 

an indefinite period of time is an 'at-will employee,' whose 

employment may be terminated by either party without cause and 

without notice, and whose termination does not give rise to a 

cause of action." Continental Airlines, Inc. v. Keenan, 731 P.2d 

708, 711 (Colo. 1987} (en bane}. However, Colorado law recognizes 

that under certain circumstances, exceptions to this general rule 

allow an at-will employee to enforce certain rights or procedures 

prior to termination. See Pittman v. Larson Distributing Co., 724 

-3-

Appellate Case: 85-1467 Document: 010110028289 Date Filed: 02/29/1988 Page: 3 
P.2d 1379, 1385-86 (Colo. Ct. App. 1986). Plaintiff maintains 

that two circumstances of his employment situation bring his case 

within the exceptions to the at-will rule. 

Plaintiff first cla i ms that HP's Manual qualifies as an 

employee manual and that its termination procedures must be followed. Plaintiff appropriately directs our attention to Keenan, 

in which the Colorado Supreme Court ruled that an at-will employee 

may enforce termination procedures found in an employee manual if 

the elements of (1) offer and acceptance or (2) promissory estoppel are present. Keenan, 731 P.2d at 711-12. 

Even if we assume that plaintiff can establish offer and 

acceptance or promissory estoppel, there is still no material 

issue of fact to resolve because the Manual does not require HP to 

follow any definite procedures for terminating an employee for 

"gross misconduct." At best, the Manual merely recommends some 

guidelines that HP officials should consider in terminating an 

employee for "gross misconduct": 

An employee engaged in willful, harmful ac ts involving 

the company may be required by the supervisor to leave 

the premises. The functional, personnel, and entity 

managers will review the circumstance(s) and determine 

whether termination is appropriate. Willful, harmful 

acts which may be the basis for termination include, but 

are not limited to, the following: theft or damage of 

HP property; use, possession, sale, or dissemination of 

illegal drugs; being under the influence of alcohol or 

drugs; fighting; intimidation; insubordination; and harassment. Written or verbal warnings are not required. 

However, a written summary of the reason(s) for termination should be presented to the employee upon notification of termination. 

- 4-

Appellate Case: 85-1467 Document: 010110028289 Date Filed: 02/29/1988 Page: 4 
' 

Record, vol. 1, at 25. 

Referring to the above provision, plaintiff argues that he 

should have been given a written summary of the reasons for termination "upon notification of termination." We note that plaintiff 

was orally advised of the reasons for termination when he was 

fired and that about a month thereafter he was provided a written 

summary of the charges. Record, vol. 2, app. H. Our review of 

the record reveals that the written summary provision in the 

Manual is nothing more than a discretionary guideline. Moreover, 

the record clearly indicates that an employee discharged for 

"gross misconduct" might not receive a written summary at termination. In a memorandum explaining termination procedures (a 

memorandum plaintiff had knowledge of, record, vol. 2, at 13), HP 

made clear that employees involved in felonious conduct "(such as 

theft)" could be immediately terminated. 2 Record, vol. 2, app. G, 

at 4. In view of this allowance for immediate termination and the 

tentativeness of the written summary provision, we are persuaded 

that HP had not bound itself to present a written summary at discharge. Thus, there would be no genuine issue of material fact to 

resolve at trial. Our review of the Manual and the record convinces us that the district court was correct when it concluded 

2 We note that plaintiff also argues in his reply brief that he 

was not discharged for "gross misconduct" but rather for conduct 

that required specific termination procedures. We find this 

argument to be unpersuasive. The principal charge against 

plaintiff was theft. Theft is explicitly enumerated as one of the 

acts constituting "gross misconduct." 

-5-

Appellate Case: 85-1467 Document: 010110028289 Date Filed: 02/29/1988 Page: 5 
that "there is nothing to indicate that the employer agreed to 

require any particular showing to warrant dismissal for 'gross 

misconduct,' and there is nothing to indicate that the employees 

were to be given any notice and opportunity for hearing on any 

such allegations." Record, vol. 1, at 75-76. 

Plaintiff's second reason for claiming an exception to the 

general at-will rule is that HP's practice of promoting job security and fairness contractually binds HP to act in good faith and 

to use fair dealing in terminating him. This argument is not well 

taken because Colorado has refused to imply a covenant of good 

faith and fair dealing in employment contracts. Pittman, 724 P.2d 

at 1385-86. In light of this refusal, plaintiff is not entitled 

as a matter of law to claim the benefits of implied covenant 

rights in his employment with HP. 

Summary judgment was properly granted against plaintiff's 

claim that HP breached an implied contract of employment. 

II. Federal Wiretapping 

Plaintiff alleges that HP violated 18 u.s.c. § 25ll(c)-(d) 

(1982) by illegally using and disclosing the contents of the taped 

telephone conversations. Plaintiff claims that Mr. Graham's taping of the conversations was illegal due to his "injurious'' 

motive, and thus HP's use and disclosure of the tapes violated 

plaintiff's privacy rights. 

-6-

Appellate Case: 85-1467 Document: 010110028289 Date Filed: 02/29/1988 Page: 6 
Section 2511(2)(d) provides that Mr. Graham's interception of 

the conversations was unlawful if he recorded the conversations in 

order to commit a crime, tortious act, or any other injurious act. 

Plaintiff claims that Mr. Graham intended to commit an injurious 

act because his purpose in taping the conversations was to get 

evidence to have his supervisors fired. 

Even if improper motive is established for the taping, HP 

would not be liable for using or disclosing these tapes unless HP 

knew or had reason to know that Mr. Graham had intercepted the 

conversations unlawfully. See 18 U.S.C. § 25ll(l)(c)-(d). There 

is no evidence in the record that HP had or should have had such 

knowledge. Plaintiff attempts to prove that HP should have known 

the conversations were taped with improper motive because HP representatives had previously known that Mr. Graham had an alcohol 

problem and was rumored to have been involved in drugs and prostitution. Plaintiff contends that this information, combined with 

Mr. Graham's poor work performance, previous discipline, and 

excellent technical skills, should have alerted HP that Mr. Graham 

had an improper motive in recording the conversations and that 

Mr. Graham had the skills sufficient to forge the recordings. 

Even when viewed in a light most favorable to plaintiff, this 

evidence fails to prove that HP should have known that Mr. Graham 

may have had an unlawful motive. The record reveals that HP carefully examined Mr. Graham's purpose for taping the conversations, 

-7-

Appellate Case: 85-1467 Document: 010110028289 Date Filed: 02/29/1988 Page: 7 
and that to HP's knowledge Mr. Graham was partially involved in 

some of the illegal activities and had taped the conversations 

because he wanted to set the record straight. Record, vol. 1, at 

37-40 (he wanted to clean up his life and to protect his interests}. Moreover, from HP's perspective, Mr. Graham was not using 

the tapes to affect his supervisors illegally or to blackmail 

them. Rather, he was following a perfectly legal course of turning in evidence of a company theft. 

Our review of the record reveals no evidence that HP should 

have known that the tapes may have been improperly obtained by 

Mr. Graham. Summary judgment was correctly entered on this claim. 

Plaintiff argues that if Mr. Graham's acquisition of the 

tapes violated 18 u.s.c. § 2511, then HP's use of the tapes in the 

investigation and HP's disclosure of the tapes to local police 

also violated 47 U.S.C. § 605 (1982). Since we concluded above 

that there is no evidence in the record that HP violated 18 U.S.C. 

§ 2511, we likewise conclude that HP lacked the requisite 

knowledge to violate 47 U.S.C. § 605. We therefore conclude that 

summary judgment as to the alleged violations of this provision 

was correctly entered. 

Summary judgment on all claims is AFFIRMED. 

-8-

Entered for the Court 

Monroe G. McKay 

Circuit Judge 

Appellate Case: 85-1467 Document: 010110028289 Date Filed: 02/29/1988 Page: 8