Title: DARROW v. INTEGRIS HEALTH, INC.
Citation: 176 P.3d 1204, 2008 OK 1
Docket Number: 
State: Oklahoma
Issuer: Oklahoma Supreme Court
Date: January 15, 2008

DARROW v. INTEGRIS HEALTH, INC. Annotate this Case DARROW v. INTEGRIS HEALTH, INC. 2008 OK 1 176 P.3d 1204 Case Number: 103281 Decided: 01/15/2008 THE SUPREME COURT OF THE STATE OF OKLAHOMA CHRIS EUGENE DARROW, Plaintiff/Appellant, v. INTEGRIS HEALTH, INC., Defendant/Appellee. ON CERTIORARI TO THE COURT OF CIVIL APPEALS, DIV III ¶0 An employee brought suit against his employer claiming he was wrongfully discharged in breach of the public policy of the State of Oklahoma. The trial judge, Vicki L. Robertson of the District Court in Oklahoma County, dismissed the employee's amended petition for failure to state a claim upon which relief may be granted. The Court of Civil Appeals affirmed this ruling. THE COURT OF CIVIL APPEALS' OPINION IS VACATED, THE TRIAL COURT'S DISMISSAL OF THE ACTION IS REVERSED AND THE CAUSE IS REMANDED TO THE TRIAL COURT FOR FURTHER PROCEEDINGS TO BE CONSISTENT WITH TODAY'S PRONOUNCEMENT. Jana B. Leonard, Shannon C. Smith, Leonard & Associates, P.L.L.C., Oklahoma City, Oklahoma, for Appellant Leonard Court, Courtney Warmington, Crowe & Dunlevy, P.C., Oklahoma City, Oklahoma, for Appellee OPALA, J. ¶1 The question presented is whether the Court of Civil Appeals (COCA) erred when it affirmed the trial judge's decision that granted appellee's (Integris Health, Inc.) motion to dismiss the action for failure to state a claim upon which relief can be granted?2 We answer in the affirmative. I. THE ANATOMY OF LITIGATION ¶2 Chris Eugene Darrow (Darrow) brought suit against his former employer Integris Health, Inc. (Integris),3 a home health-care agency, for wrongful termination based on the public-policy exception to the at-will employment rule. His petition states he worked for Integris for approximately eight (8) years before he was dismissed on or about 7 March 2005. According to Darrow, he originally worked as a home health aide, then did data entry and eventually progressed to the positions of administrative assistant and administrative coordinator. He described his duties as those of providing advanced secretarial and administrative support for various departments and auditing all billing activities associated with computer input for proper customer invoicing. This included billing for Medicare reimbursement. His job was to seek payment for services provided to patients covered by Medicare, Medicaid and insurance benefits. He had to verify the accuracy of patient information that was to be submitted to payor entities. ¶3 On or about 2 March 2005 Darrow received an e-mail from the clinical manager of Samaritan Home Based Care.4 It notifed him of the death of an Integris patient and three (3) family members as a result of a home fire. Because Darrow was aware that some of the equipment used in home health care posed an increased risk of fire, he responded to the e-mail. ¶4 That very day Darrow received conflicting information concerning the patient's age. Because age discrepancies can delay billing, he attempted to verify the patient's correct age by checking the source documents in the chart. In doing so, he noticed that the signature authorizing Integris' services appeared to be that of a minor grandchild of the patient who also died in the fire. According to Darrow, media reports about the fire included information inconsistent with that contained in Integris' documents. In addition to the age discrepancy, the news reports indicated the lack of smoke detectors and the use of non-breakaway security bars on windows at the patient's residence. This differed from the admitting nurse's initial evaluation of the home which noted "no discrepancies" on the patient's initial intake form. 5 ¶5 Darrow notified the company's Quality Assurance Supervisor about these problems. She indicated she would talk with his supervisor when the latter returned to work later that week. Darrow's employment was terminated approximately five days later for an alleged HIPAA (Health Insurance Portability and Accountability Act of 1996) violation in the course of his review of the deceased patient's chart. ¶6 Darrow filed an amended petition II. Standard of Review ¶7 In reviewing a nisi prius disposition by dismissal, this court examines the issues de novo. III. A. The Parties' Certiorari Arguments ¶8 According to Darrow's certiorari petition, his internal reports to personnel about Integris' record discrepancies dealing with allegations of falsification of documents submitted to Medicare, possible Medicare fraud and concerns about patient safety are violations of public policy and hence are actionable in accordance with Burk B. Burk's Modification of the Common Law ¶9 Oklahoma adheres to the so-called American employment-at-will doctrine. C. A Public-Policy Exception to the At-Will Employment Doctrine May Not Rest Solely on Federal Law ¶10 The public-policy exception to the at-will employment rule is not easily applied. This is so because (1) a wide variety of scenarios potentially comprise this common-law tort ¶11 Darrow's claim is that he was wrongfully discharged for reporting possible Medicare fraud. He urges three federal statutes (the False Claims Act, 31 U.S.C. § 3730; the False Statements Act, 18 U.S.C. § 1001; as well as the Medicare and Medicaid anti-fraud and abuse provision in 42 U.S.C. § 1320a-7) make his dismissal wrongful for reporting Medicare fraud. Darrow relies on Tyler v. Original Chili Bowl, Inc., 1997OK CIV APP 3, ¶12 Seven months after Tyler was published the court again dealt with the issue before us - whether a federal statute may constitute a sufficient basis for an Oklahoma public-policy tort - when it answered a question certified to it by a United States District Court. That case, Griffin v. Mullinix, ¶13 A close reading of Griffin's text reveals that, although the court's holding was properly stated in its most narrow construction, the court bottomed its decision upon two predicates. First, text of the court's opinion plainly reveals it agreed with the defendant's argument and analysis in McKenzie v. Renberg's Inc. - that a federal statute by itself cannot serve as an articulation of Oklahoma public policy absent a specific Oklahoma court decision, statute or constitutional provision. Second, it clearly expounded the doctrine that it is neither the court nor Congress but the Oklahoma legislature that is primarily vested with the responsibility of declaring the public policy of this state. Darrow's reliance on Tyler is hence misplaced. D. Darrow's Reliance on his Employer's Falsification of Records Injects an Element of Public Interest Sufficient to Support a Burk Claim Without Contravening the Teachings of Hayes v. Eateries, Inc. ¶14 We next turn to Darrow's assertions that decisional law establishes his reports alleging Integris' (1) falsification of records37 and (2) public-safety violations38 afford a breach of public policy for his Burk claim. In affirming the nisi prius dismissal of Darrow's claim - upon the theory that he was discharged for reporting matters concerning patient safety - COCA relied on Hayes v. Eateries, Inc.39 That case teaches a restaurant employee's claim of wrongful discharge for reporting a co-employee's embezzlement was rested merely on loyalty to his employer and to the latter's proprietary interests. Because the employee was acting neither to vindicate his own interests nor those of the general public he could not rely on a public-policy exception to the at-will employment rule. COCA ruled here that Darrow's actions, much like those of the employee in Hayes, revealed no more than loyalty to his employer and his desire to save the employer from sustaining a financial loss or being subjected to liability. ¶15 We disagree with COCA's analysis and its analogy to Hayes. A close reading of that decision is instructive here. The court in Hayes ruled that a restaurant employee's internal or external reports of a co-employee's embezzlement from his employer was neither sufficient to protect nor to assert a legal interest of his own.40 According to the court, the employee in Hayes was not seeking "to vindicate a public wrong where the victim of the crime could in any real or direct sense be said to be the general public, as where crimes or violation of health or safety laws are involved."41 (emphasis supplied) Hayes distinguished the scenario implicated there from those in sister jurisdictions which have extended a measure of judicial protection to "'whistleblowing' activity geared toward the good-faith reporting of infractions by the employer or co-employees of rules, regulations or the law pertaining to the public health, safety or general welfare."42 According to the court, the situation in Hayes did not mirror "direct interests of the general public as where the reporting involves the criminal wrongdoing of the employer or [where] a co-employee perpetrated [some act] against the interests of the general public."43 (emphasis supplied) ¶16 The court's emphasis on the distinction in Hayes from all those instances where "whistleblowing" activity was deemed protected has significant implications for today's case. According to Hayes, to distinguish whistleblowing claims that would support a viable common-law tort claim from those that would not, the public policy breached must truly impact public rather than the employer's private or simply proprietary interests.44 We believe Darrow's claim in this case comes within the scope of protected activity that has public impact, is recognized in Hayes and is actionable within the Burk framework.45 ¶17 The legislature has enacted the Home Care Act, 63 O.S. 2001 § 1-1960 et seq., to regulate and license the home health-care business.46 According to the act's published statutory and historical notes, it is "[a]n Act relating to public health and safety"47 whose terms came to be codified under Title 63. That title embraces the Oklahoma Public Health Code. In addition to home care business licensing and employee certification requirements, the legislature imposed minimum certification standards for a home care agency administrator to include "education or training which shall include . . . supervision, fiscal management, ethics, . . ."48 (emphasis supplied) This demonstrates the intent of the legislature to protect all aspects of health, safety and welfare of the aged and infirm who receive health care in their own homes. The interests dealt with in today's case are clearly different from those considered in Hayes. This case deals not simply and purely with an employer's internal matter solely of entrepreneurial character and importance to Integris. The fiscal integrity of home care businesses and the safety of those who have engaged these services are of solemn concern to patients, their families, the general public and to the government. Darrow's reports of record discrepancies that relate directly to patient safety or to billing practices cannot and must not be viewed as dealing merely with matters that protect the entrepreneurial interest of his employer but rather with those matters which concern and further public-interest protections. ¶18 Darrow's reports dealing with allegations of falsification by Integris of documents (if indeed Medicare fraud is involved) would likewise be protected activity based on the terms of 21 O.S. 2001 § 1589.49 That statute deals with false entries in books of accounts kept by corporations. Unlike in Hayes, where the there-reported embezzlement was said to affect merely the private and proprietary interest of the restaurant owner, the victim of the crime alleged to have been committed here would be the general public.50 Medicare is a program paid for by the wages of working taxpayers to benefit those who are over the age of sixty-five or disabled. That it is a federal program is of no consequence. Providing legal recourse to an employee who asserts he was discharged for reporting violations of Oklahoma's criminal law where the public interest is so closely entwined clearly gives rise to a mandate of public policy on which a Burk claim may be rested. ¶19 Oklahoma law protects both internal and external reporting of whistleblowers who rely on an employer's public-policy violation to support an actionable employment termination.51 Protecting purely private and proprietary interests of an employer is not a cognizable predicate for this tort.52 Employees who report and complain of an employer's unlawful or unsafe practices and whose actions seek to further the public good by unmasking these breaches should be protected from an employer's retaliation.53 We note that the legislature does protect state employees from retaliatory discharge for whistleblowing activity.54 Although not applicable to today's case, the state's "Whistleblower Act," 74 O.S. Supp. 2003 § 840-2.5, part of the Oklahoma Personnel Act, manifests a public policy for shielding state employees from retaliation which is in harmony with today's view that private employees should enjoy a not dissimilar quantum of protection under Burk.55 ¶20 As a final note, we caution that today's pronouncement is not to be understood so broadly as to warrant a conclusion that any employee allegation of illegal or unsafe employer's activity will withstand scrutiny in light of Burk. The pervasive public interest implicated here by the alleged violations of the public health, safety, and welfare is a prominent consideration for protecting these complaints by the breach of public policy shield. Darrow's petition is hence clearly sufficient to survive Integris' motion to dismiss. IV. SUMMARY ¶21 We hold today that COCA erred when it affirmed the trial judge's dismissal of Darrow's amended petition. Darrow has alleged facts for which relief is legally possible because they lie within the protected workplace parameters established for a wrongful discharge in breach of public policy. ¶22 The Court of Civil Appeals' opinion that affirms the trial court's dismissal of the action for failure to state a claim upon which relief can be granted is vacated, the trial court's dismissal of the action is reversed, and the cause is remanded for further proceedings to be consistent with this pronouncement. ¶23 EDMONDSON, V.C.J., OPALA, KAUGER, WATT, TAYLOR, COLBERT, REIF, JJ., concur ¶24 WINCHESTER, C.J. and HARGRAVE, J., dissent FOOT