Court Opinion

ID: 4464070
Source: CourtListenerOpinion
Date Created: 2019-12-13 15:03:41.941993+00
Date Added: 2024-06-11T14:28:03.386426
License: Public Domain

IN THE SUPREME COURT OF IOWA
                                No. 18–1600

                          Filed December 13, 2019

DEBORAH FERGUSON,

      Appellee,

vs.

EXIDE TECHNOLOGIES, INC. and FRED GILBERT,

      Appellants.

      Appeal from the Iowa District Court for Delaware County, Michael J.

Shubatt, Judge.

      An employer appeals a district court decision finding Iowa Code

section 730.5 (2016) does not provide the exclusive civil remedy for its

violation and the district court’s award of attorney fees. AFFIRMED IN

PART, REVERSED IN PART, AND REMANDED.

      Thomas D. Wolle of Simmons Perrine Moyer Bergman PLC,

Cedar Rapids, for appellants.

      Amy Beck and David R. Albrecht of Fiedler Law Firm P.L.C.,

Johnston, for appellee.
                                     2

PER CURIAM.

      In this case, we must primarily decide whether a civil enforcement

mechanism granted by the legislature in a statute regulating drug testing

in the workplace forecloses judicial recognition of an overlapping common

law tort for wrongful discharge in violation of public policy. Specifically,

we must decide whether a person may bring a wrongful-discharge claim

based on a violation of Iowa Code section 730.5 (2016) when the same

person already has a statutory remedy under section 730.5 for the same

conduct.   We conclude a common law wrongful-discharge claim is not

available. Accordingly, we reverse the order of the district court denying

the defendants’ motion for judgment notwithstanding the verdict on the

common law claim, affirm the court’s rulings on the section 730.5 claim,

and remand for further proceedings consistent with this opinion.

      I. Background Facts and Proceedings.

      Deborah Ferguson was employed by Exide Technologies, Inc. as a

“wet formation operator.” Her job required her to lift up to 2300 car and

tractor batteries, ranging from sixty to 180 pounds, in a single shift, from

one location to another. Ferguson began her work with Exide in 2012.

After changes to her work duties in 2013 increased the amount of lifting

she had to do, she began to experience intermittent pain in both her

elbows. By September 2016, the pain had become severe and constant.

In October 2016, Ferguson concluded the pain was too severe to continue

working and reported her pain to her supervisor.

      Ferguson was assigned lighter duty and sent to the plant nurse. She

was eventually sent to a doctor who diagnosed her with “tennis elbow” in

both elbows. At the doctor’s office, she was informed she was required to

submit to a drug and alcohol test pursuant to Exide’s drug and alcohol

testing policy. Ferguson refused to take the test and left the office. Under
                                           3

Exide’s policy, the refusal to take a drug test was considered the same as

failing a drug test.

      After her appointment, Ferguson, who worked the late shift, received

a phone call telling her not to come into work that night. The following

day, Exide terminated Ferguson from her employment for her refusal to

take the drug and alcohol test.

      Ferguson filed an action in district court against Exide, claiming her

termination was wrongful.           She brought her claim under a statute

providing civil remedies against employers for violating the workplace

drug-testing provisions and also asserted a claim for wrongful discharge

in violation of public policy. Although it initially denied liability, Exide

acknowledged it violated the drug and alcohol testing statute.        Since

Ferguson’s refusal to take the illegal test was the reason for her firing,

Exide admitted Ferguson’s firing was unlawful. 1 Both parties moved for

summary judgment.          Exide argued Ferguson’s common law claim was

preempted by the civil cause of action provided under the statute.

Ferguson argued both claims could be brought. The district court granted

Ferguson’s motion and denied Exide’s motion.

      Because Exide admitted to the statutory violation, the case
proceeded to trial on the matter of damages alone. Ferguson requested a

jury trial, which is available for a common law wrongful discharge in

violation of public policy claim, but not the statutory violation. The jury

awarded Ferguson $45,606.40 in lost wages and benefits and $12,000 in

emotional distress damages. Exide renewed its position that the common

law claim was barred as a matter of law by filing unsuccessful motions for

directed verdict and for judgment notwithstanding the verdict (JNOV).

      1Ferguson   has since been reinstated.
                                     4

      Ferguson also requested attorney fees and costs allowed under the

statute. She requested fees of $75,991.99. The district court only awarded

fees for the portion of the work in the case devoted to the statutory claim.

See Iowa Code § 730.5(15)(a)(1) (authorizing an award of attorney fees);

Smith v. Iowa State Univ. of Sci. & Tech., 885 N.W.2d 620, 624 (Iowa 2016)

(addressing apportionment of fees when fees were available under some

but not all of the plaintiff’s claims). Exide objected to the amount of fees

Ferguson requested and contended the fees should actually be much

lower. The court awarded Ferguson $39,500 in costs and fees, broken

down into $35,000 in attorney fees and $4500 in court expenses.

      Exide filed an appeal from the denial of its summary judgment and

JNOV motions by the district court, as well as from the amount of the

attorney fees awarded. We retained the case on appeal.

      II. Standard of Review.

      We review rulings on JNOV motions for correction of errors at law.

Doe v. Cent. Iowa Health Sys., 766 N.W.2d 787, 790 (Iowa 2009). We

review awards of attorney fees for abuse of discretion. Lee v. State, 874
N.W.2d 631, 637 (Iowa 2016).

      III. Wrongful Discharge in Violation of Public Policy.

      This case centers on Iowa Code section 730.5, the statutory scheme

providing for drug and alcohol testing of current and potential employees

in Iowa. Section 730.5 is the source of the policy for Ferguson’s tortious

wrongful-discharge action. However, section 730.5 also provides for a civil

cause of action.

            a. This section may be enforced through a civil action.
             (1) A person who violates this section or who aids in the
      violation of this section[] is liable to an aggrieved employee or
      prospective employee for affirmative relief including
      reinstatement or hiring, with or without back pay, or any
                                       5
      other equitable relief as the court deems appropriate including
      attorney fees and court costs.
             ....
             b. In an action brought under this subsection alleging
      that an employer has required or requested a drug or alcohol
      test in violation of this section, the employer has the burden
      of proving that the requirements of this section were met.

Iowa Code § 730.5(15). We must determine whether this civil cause of

action prevents an aggrieved employee from also bringing a common law

wrongful-discharge action.

      A. The Wrongful-Discharge Doctrine Generally. Employment in

Iowa is generally at-will, meaning an employee may usually be fired for any

reason or no reason at all. Dorshkind v. Oak Park Place of Dubuque II,

L.L.C., 835 N.W.2d 293, 300 (Iowa 2013). We first recognized an exception

to the at-will doctrine, the doctrine of common law wrongful discharge in

violation of public policy, in 1988. See Springer v. Weeks & Leo Co., 429
N.W.2d 558 (Iowa 1988) (en banc). Springer involved an employee who was

discharged for filing a workers’ compensation claim. Id. at 560. We held

the workers’ compensation statute created a “well-recognized and defined

public policy of the state,” and the wrongful-discharge action was an

appropriate enforcement mechanism of that statute. Id. at 560–61.

      Our reasoning for adopting the wrongful-discharge claim focused on

the need to provide a remedy for conduct that violated legislatively declared

public policy.   Id. at 560–61.       We observed, “To permit the type of

retaliatory discharge which has been alleged in this case to go without a

remedy would fly in the face of this policy.” Id. at 561. We also noted “by

sanctioning wrongful discharge actions for contravention of a public policy

which has been articulated in a statutory scheme, we are acting to advance

a legislatively declared goal.” Id.
                                        6

      We have explored and reaffirmed the doctrine in many cases since

Springer. In Borschel v. City of Perry, we explained that there were three

primary situations when an action for wrongful discharge in violation of

public policy was available. 512 N.W.2d 565, 567 (Iowa 1994). Those

situations included “retaliation for performing an important and socially

desirable act, exercising a statutory right, or refusing to commit an

unlawful act.” Id. (quoting 82 Am. Jur. 2d Wrongful Discharge § 14, at 687

(1992)).   We observed that “[s]uch policies may be expressed in the

constitution and the statutes of the state.” Id.

             An employee seeking protection under the public-policy
      exception in his or her wrongful-discharge claim must prove
      the following elements:
               (1) the existence of a clearly defined and well-
               recognized public policy that protects the
               employee’s activity; (2) this public policy would be
               undermined by the employee’s discharge from
               employment; (3) the employee engaged in the
               protected activity, and this conduct was the
               reason the employer discharged the employee;
               and (4) the employer had no overriding business
               justification for the discharge.

Dorshkind, 835 N.W.2d at 300 (quoting Berry v. Liberty Holdings, Inc., 803
N.W.2d 106, 109–10 (Iowa 2011)). The parties agree all four elements are

met here. The only issue is whether the remedies already provided in

section Iowa Code section 730.5 foreclose the common law claim.

      We further explored the rationale for the doctrine in Harvey v. Care

Initiatives, Inc., 634 N.W.2d 681 (Iowa 2001), in which we rejected the

opportunity to expand the doctrine to independent contractors.                 In

refusing to so expand the tort, we explained we found “no compelling need,

as we did for at-will employees, to support a wrongful termination tort for

independent contractors.” Id. at 684. We went on to consider whether the

legislature,   nonetheless,    intended     to   provide   such   a   remedy   to
                                     7

independent contractors. Id. at 684–85. Rejecting that contention, we

observed that “we must refrain from extending protection to workers from

unfair treatment after our legislature has weighed in on the issue and

established the parameters of the governing public policy.” Id. at 686.

      B. Exclusive Remedy. Throughout the history of our common law

doctrine, we have at times found a statute precludes the wrongful-

discharge common law claim and at times found it does not. The most

prominent example of a preemptive statute is the Iowa Civil Rights Act

(ICRA). In Northrup v. Farmland Industries, Inc., 372 N.W.2d 193, 196

(Iowa 1985) (en banc), we examined Iowa Code chapter 601A, now chapter

216, while considering a claim brought by a man who alleged he was fired

due to his alcoholism, considered a disability under the ICRA. Id. We

emphasized the statute said an aggrieved employee “must” initially seek

an administrative remedy.     Id. at 196–97.   Because this language was

mandatory, we found a common law cause of action of wrongful discharge

in violation of public policy could not proceed. Id. at 197.

      Another case in which we considered the preemption question was

Greenland v. Fairtron Corp., 500 N.W.2d 36 (Iowa 1993).           There, we

reaffirmed that ICRA-related wrongful-discharge claims are preempted by

the statute, even after our official adoption of the tort in Springer. Id. at

37. Specifically, Greenland considered the extent of ICRA’s preemption of

the common law. Id. at 38. The plaintiff in that case brought multiple

common law claims, including intentional infliction of emotional distress,

assault, and battery, alongside a claim of sex discrimination. Id. at 37.

We held the plaintiff’s claim of intentional infliction of emotional distress

was preempted, but allowed the assault and battery complaints. Id. at 38–

39.
                                     8

      A non-ICRA case in which we found the statutory remedy to be

exclusive was Van Baale v. City of Des Moines, 550 N.W.2d 153 (Iowa

1996), abrogated on other grounds by Godfrey v. State, 898 N.W.2d 844,

864, 872 (Iowa 2017). In that case, a police officer was fired after his wife

filed a domestic abuse complaint against him, he resisted arrest, and he

pled guilty to resisting arrest and nolo contendere to the domestic abuse

complaint. Id. at 154–55. Although the officer did not characterize his

claim as a wrongful-discharge claim, we viewed it as one in substance. Id.

at 156. The case concerned the civil service provisions in chapter 400 of

the Iowa Code. Id. at 155. We concluded Van Baale could not bring a

wrongful-discharge claim because

            Chapter 400 creates a new right to continued
      employment (subject only to removal for cause) that did not
      exist at common law where public employment was at-will.
      Because chapter 400 creates this new right—not merely a new
      remedy for a preexisting one—we think chapter 400
      proceedings must be considered the exclusive means of
      challenging the arbitrariness of a civil service employee’s
      discharge.

Id. at 156.   In so holding, we quoted a rule of statutory construction

providing that “[w]here the legislature has provided a comprehensive

scheme for dealing with a specified kind of dispute, the statutory remedy

provided is generally exclusive.” Id. (quoting 1A C.J.S. Actions § 14 n.55

(1985)).

      However, we have not found preemption in other cases. In ruling

for Ferguson at the summary judgment stage, the district court relied on

George v. D.W. Zinser Co., 762 N.W.2d 865 (Iowa 2009). In that case, we

considered whether Iowa’s Occupational Safety and Health Act (IOSHA),

Iowa Code chapter 88 (2007), provided the exclusive remedy for its

violation. Id. at 871. Section 88.9(3) granted an aggrieved employee the

right to file an administrative action against their employer. Id. at 872.
                                       9

Noting the statute used “may,” permissive language, we concluded the

remedy set forth in it was not exclusive. Id. We contrasted the language

in chapter 88 with the “must” language of ICRA. Id. During our discussion

of a res judicata issue in the case, we also noted, “Not only does the

statutory description of the investigation lack the characteristics of an

adjudication, but the Division was not acting in a judicial capacity during

this specific investigation.” Id. at 870. As such,

      George did not have a full and fair opportunity to present
      evidence or respond to D.W. Zinser’s position. He had little to
      no control over the agency’s investigation. The Division did
      not hold a hearing on the issue. It only conducted an informal
      nine day investigation. The parties were not afforded a full
      and fair opportunity to litigate the matter in dispute.

Id.

      Another case, Tullis v. Merrill, 584 N.W.2d 236 (Iowa 1998),

presented a similar issue.        There, we again found the common law

wrongful-discharge action was available. Id. at 239. The Code section at

issue was Iowa Code section 91A.10 (1995), which “authorizes the labor

commissioner to determine whether wages are unpaid and to commence

an action in court on behalf of the complainant for their recovery.” Id. The

statute also stated that the labor commissioner’s authorization to bring a

claim did not prevent an aggrieved employee’s actions for damages if the

case was not assigned to the commissioner.           Id.   We looked at the

implementing administrative regulations, which stated “an employee

would be protected against discharge or discrimination caused by the

complaint to the employer.” Id. at 239–40 (quoting Iowa Admin. Code

r. 347—36.6(2)).    We concluded the administrative remedy was not

exclusive,   and   the   public   policy   wrongful-termination   claim   was

appropriate. Id.
                                    10

      Importantly, both cases involved administrative, rather than court,

remedies. Administrative remedies do not provide the level of protection,

control, and right to process involved in the court system, justifying the

continued existence of the common law claim when the only remedy

provided is administrative. See George, 762 N.W.2d at 870. Nor are we

bound by the rule in Van Baale or the ICRA cases, which involved,

respectively, a new right to continued employment and a statute using

mandatory language. See Van Baale, 550 N.W.2d at 156; Greenland, 500
N.W.2d at 38–39; Northrup, 372 N.W.2d at 197.

      C. The Purpose of the Wrongful Discharge Tort. Thus, we face

an issue of first impression.    It was presented but not preserved in

Ackerman v. State, 913 N.W.2d 610, 621–22 (Iowa 2018).            Now, we

confront the question left unanswered in that case.

      In resolving the question, we are guided by the original purpose of

the common law claim for wrongful discharge in violation of public policy.

That original purpose was to provide a court remedy to enforce legislatively

declared public policy. See Springer, 429 N.W.2d at 560–61. A useful

question to ask in framing this issue is if we had not adopted the common

law doctrine in Springer would we choose to adopt it faced with a statute

like section Iowa Code 730.5 (2016), which provides for a civil cause of

action? We think the answer must be no.

      This framing is consistent with the approach other states take. See,

e.g., Miles v. Martin Marietta Corp., 861 F. Supp. 73, 74 (D. Colo. 1994)

(“Colorado law is clear that a separate public policy wrongful discharge

claim is not available where the statute at issue provides a wrongful

discharge remedy.”); Hill v. Ky. Lottery Corp., 327 S.W.3d 412, 421 (Ky.

2010) (“In the context of a wrongful discharge case, preemption occurs

when the statutes that establish the ‘well-defined public policy’ violation
                                      11

which supports the wrongful discharge pleading are the same statutes that

establish a statutory cause of action for, and structure the remedy for,

violations of that public policy.”); King v. Marriott Int’l, Inc., 866 A.2d 895,

904 (Md. Ct. Spec. App. 2005) (“When a statutory cause of action is

available to redress the injuries of an employee, wrongful discharge is not

an appropriate remedy . . . .”).

      In keeping with the original purpose of the common law action, when

the legislature includes a right to civil enforcement in the very statute that

contains the public policy a common law claim would protect, the common

law claim for wrongful discharge in violation of public policy becomes

unnecessary. In this situation, the “legislature has weighed in on the issue

and established the parameters of the governing public policy.” Harvey,
634 N.W.2d at 686.       If the legislature considers the remedies it has

provided inadequate, it is free to modify them.        However, we need not

provide an alternative court remedy when the legislature already provided

one. Thus, we hold that when a civil cause of action is provided by the

legislature in the same statute that creates the public policy to be enforced,

the civil cause of action is the exclusive remedy for violation of that statute.

      IV. Attorney Fees and Costs.

      We next turn to Exide’s contention that the district court abused its

discretion in the amount of attorney fees and costs it awarded to Ferguson.

Smith, which the district court was guided by, explained how district

courts should proceed when attorney fees are authorized for only one

portion of a lawsuit. 885 N.W.2d at 625. In that case, Smith sued Iowa

State University (ISU) under various causes of action, only one of which

allowed recovery of attorney fees. Id. at 624. We held Smith could recover

only for the portion of the litigation attributable to the cause of action that

permitted an award of attorney fees. Id. at 625.
                                     12

      We explained that the district court should follow a two-step process

in evaluating how to award fees in such hybrid cases.

      First, while fees can be awarded for time devoted generally to
      the litigation as a whole, the district court should make an
      appropriate reduction for . . . unrelated time spent on claims
      for which fees are not recoverable. Then, . . . if the plaintiff
      only obtained partial or limited success on the claim for which
      the legislature has authorized fees, the court must consider
      the reasonableness of the hours expended in light of this
      ultimate result.

Id.   The district court need not “make dollar-by-dollar attorney fee

reductions for time spent on matters such as an overlong proof brief.” Id.

at 626. Courts may consider such issues, but are “not required to ‘sift

through all the legal work done.’ ” Id. at 627 (quoting Vaughan v. Must,

Inc., 542 N.W.2d 533, 541 (Iowa 1996)). “[T]here is no ‘rigid formula’ that

must be followed.” Id. (quoting Vaughan, 542 N.W.2d at 541). Moreover,

“[a] request for attorney’s fees should not result in a second major

litigation.” Id. at 626 (quoting Hensley v. Eckerhart, 461 U.S. 424, 437,
103 S. Ct. 1933, 1941 (1983)).

      Ferguson requested $75,991.99 in attorney fees and legal expenses.

This request did not include approximately ninety hours of work Ferguson

determined were solely associated with her common law claim.             The

district court ultimately awarded $35,000 in fees and $4500 in expenses.

In its ruling, the district court discussed the “significant time” Ferguson’s

attorneys spent “developing aspects of the case that had nothing to do with

the statutory claim.” The court noted it was “impossible . . . to assess

Plaintiff’s claimed legal fees in an exacting mathematical fashion” because

the submitted report included “block entries for each attorney by date.”

Ultimately, explicitly following Smith, the court awarded $35,000 in fees

as “the amount of fees reasonably and necessarily incurred in pursuit of

[Ferguson’s] statutory claim,” adjusted based on her relative success.
                                      13

Next, the court turned to legal expenses. It did “not believe the expenses

claimed by Plaintiff warrant[ed] as much of an adjustment . . . as many of

those expenses would have been incurred even if there had only been a

trial on the statutory claim.” It therefore awarded $4500 in costs, less

than the $5648.04 requested.

      However, Exide argues the court did not reduce the award enough.

In response to Ferguson’s motion for attorney fees, Exide went through the

time sheets submitted by Ferguson and calculated, specifically, the

amount Exide believes Ferguson’s attorneys should have received. Exide

identified reductions totaling $48,367.20, which would have left Ferguson

with a total fee award of $22.273.75.           Exide would have reduced

Ferguson’s expenses by $3789.11, for a total of $1858.93. Exide argues

the district court should have specifically ruled on the entries it identified.

      At the outset, we note “[t]he district court is considered an expert in

what constitutes a reasonable attorney fee, and we afford it wide discretion

in making its decision.” GreatAmerica Leasing Corp. v. Cool Comfort Air

Conditioning & Refrigeration, Inc., 691 N.W.2d 730, 733 (Iowa 2005).

Moreover, if the district court had responded to each of Exide’s individual

contentions, the result could easily have become “a second major

litigation” as Ferguson argued against Exide’s conclusions. Instead, the

district court followed Smith, including its instruction that the court need

not “sift through all the legal work,” and reduced the fees Ferguson

requested by approximately half and the expenses requested by over

$1000. The district court was not obligated to do what Exide asks and did

not abuse its discretion. We therefore affirm the district court’s award of

attorney fees and costs to Ferguson.
                                    14

      V. Conclusion.

      We find the civil cause of action provided by Iowa Code section 730.5

is the exclusive remedy for a violation of section 730.5. This means we

reverse the district court’s order denying Exide’s motions for JNOV on the

common law claim and its denial of summary judgment in favor of Exide

on the common law wrongful-discharge claim. On remand, the district

court shall enter judgment in favor of Exide on Ferguson’s common law

wrongful-discharge claim, vacate those portions of the jury’s damages

award that would be available only under a common law tort theory, and

uphold those portions of the jury’s award that would be available under

Iowa Code section 730.5(15). See Iowa Code § 730.5(15)(a)(1) (authorizing

“affirmative relief including reinstatement or hiring, with or without back

pay, or any other equitable relief as the court deems appropriate including

attorney fees and court costs”). We also find the district court did not

abuse its discretion in the amount of attorney fees it awarded Ferguson

and affirm the attorney fee judgment. Accordingly, we reverse in part the

judgment of the district court, affirm in part the judgment of the district

court, and remand the case to the district court for further proceedings

consistent with this opinion.

      AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.

      This opinion shall be published.