Court Opinion

ID: 2758665
Source: CourtListenerOpinion
Date Created: 2014-12-09 17:50:23.297455+00
Date Added: 2024-06-11T10:36:38.582077
License: Public Domain

IN THE SUPREME COURT OF TEXAS
                                         444444444444
                                           NO . 13-0094
                                         444444444444

          TEXAS COMMISSION ON ENVIRONMENTAL QUALITY, PETITIONER,

                                                 v.

                            ROSAENA RESENDEZ, RESPONDENT

           4444444444444444444444444444444444444444444444444444
                            ON PETITION FOR REVIEW FROM THE
                     COURT OF APPEALS FOR THE THIRD DISTRICT OF TEXAS
           4444444444444444444444444444444444444444444444444444

                                          PER CURIAM

       This case calls upon us to again apply the Texas Whistleblower Act. Rosaena Resendez was

fired from her position at the Texas Commission on Environmental Quality (TCEQ) after she

reported alleged wrongdoing to supervisors within the organization and to the office of a state

senator. In Texas Department of Human Services v. Okoli, we recently reaffirmed that an internal

report of wrongdoing does not trigger the Act’s protection unless it is made directly to an authority

with outward-looking law-enforcement power. See 440 S.W.3d 611, 616 (Tex. 2014). The court of

appeals held that Resendez’s internal reports were sufficient under the Act. Because that holding is

inconsistent with our precedent as expressed in Okoli, and because Resendez’s report to the senator’s

office does not satisfy the Act’s requirements, we reverse and dismiss the case.
       TCEQ administers the Texas Emissions Reduction Plan (TERP), a program that incentivizes

emissions reduction, in part by providing money or rebates to individuals to replace certain high-

emission vehicles. Resendez, a thirty-four-year TCEQ employee, was assigned to investigate the

whereabouts of a vehicle purchased with TERP funds. When she learned the owner of the vehicle

had been deported to Mexico, she told supervisor Steve Dayton that individuals who were in the

country illegally were receiving TERP funds. According to Resendez, Dayton indicated he was

aware of the problem but seemed reluctant to address it. The next day she presented the issue to Joe

Walton, another supervisor. Walton, she claims, told her to “drop it.” Soon after, he wrote a

disciplinary report, stating Resendez was “argumentative” in her conversations with him and with

Dayton. In the following months, Resendez was written up multiple times for being “disrespectful

and unprofessional,” in what she claims were “false indictments.” She was ultimately placed on

probation.

       In the weeks before the end of her probation period, Resendez claims she met with David

Brymer, a TCEQ director, and attempted to discuss the conversations she had with Walton and

Dayton. Brymer was unreceptive. Finally, she claims she reported the issue and the discussions with

her supervisors to Senator Juan “Chuy” Hinojosa’s office. Days later, she was terminated.

       Resendez sued TCEQ under the Whistleblower Act, which waives a state agency’s sovereign

immunity from suit for retaliatory discharge under certain circumstances. TEX . GOV ’T CODE

§ 554.0035. TCEQ filed a plea to the jurisdiction, asserting Resendez’s reports were merely internal

policy recommendations, not reports to an appropriate law-enforcement authority as required by the

Act. The trial court sustained the plea and dismissed the case. Resendez appealed.

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       The court of appeals reversed. It held that by reporting Dayton’s and Walton’s failures to act

on fraud occurring within the TERP program to Brymer, Resendez presented a fact issue on the two

disputed elements of a whistleblower claim: (1) whether she had a good-faith belief that Dayton and

Walton violated the law, and (2) whether Brymer was an appropriate law-enforcement authority. Tex.

Comm’n on Envtl. Quality v. Resendez, 391 S.W.3d 312, 325, 327 (Tex. App.—Austin 2012).

       For the Whistleblower Act to apply, a public employee must have made a good-faith report

of a violation of law by a public employee to an “appropriate law[-]enforcement authority.” TEX .

GOV ’T CODE § 554.002(a). We recently decided Texas Department of Human Services v. Okoli, in

which we held internal reports of wrongdoing do not satisfy this requirement, even where agency

policy is to forward the reports to the agency’s enforcement arm. 440 S.W.3d at 616–17. Under this

Court’s interpretation of the Act in Okoli and other cases, a supervisor like Brymer is not an

appropriate law-enforcement authority, and neither is Senator Hinojosa.

       Texas Government Code section 321 criminalizes the failure of a state agency’s

“administrative head” to report fraud or misappropriation of funds if there is reasonable cause to

believe that such has taken place. TEX . GOV ’T CODE §§ 321.019, 321.022(a). Resendez contends that

Walton, Dayton, and Brymer violated section 321 when they failed to act once she reported the

TERP fraud to them. She argues that she triggered the Whistleblower Act’s protection when she

reported their alleged violations to Brymer and then to Senator Hinojosa’s office.

       Under the Act, a report is deemed to be to an appropriate law-enforcement authority if the

employee in good faith believes the reported-to entity is authorized to regulate under or enforce the

law, or investigate or prosecute a violation of criminal law. TEX . GOV ’T CODE § 554.002(b). A good-

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faith belief requires a subjective, actual belief that the entity has enforcement or investigatory

authority, and that the belief is objectively reasonable in light of the employee’s training and

experience. Tex. Dep’t of Transp. v. Needham, 82 S.W.3d 314, 320–21 (Tex. 2002). Even if

Resendez subjectively believed that Brymer and Senator Hinojosa had authority to investigate her

supervisors’ purported illegalities, Resendez fails to satisfy the objective requirement.

       Brymer, as the director of TCEQ’s Air Quality Division, may have had authority to regulate

activities within that division and may have had the power to enforce internal policy or to discipline

Dayton and Walton for noncompliance. Internal-compliance authority, however, cannot support a

good-faith belief that Brymer had the power to enforce the Government Code’s fraud-reporting

provisions or to pursue criminal charges. See Univ. of Tex. Sw. Med. Ctr. v. Gentilello, 398 S.W.3d
680, 687–88 (Tex. 2013) (holding belief that supervisor charged only with internal-compliance

authority was appropriate law-enforcement authority was not objectively reasonable); State v. Lueck,

290 S.W.3d 876, 885–86 (Tex. 2009) (holding belief that TxDOT division head who could neither

regulate nor enforce federal traffic regulations was appropriate law-enforcement authority could not

be in good faith). Resendez’s report to Brymer was an internal report up a chain of command, and

we have consistently held that such reports are insufficient under the Act. See Okoli, 440 S.W.3d at

614 (collecting cases).

       Resendez argues that TCEQ has a fraud-investigation program and a policy of cooperating

with the Travis County District Attorney to investigate “fraud in the TERP program,” and this

provides a basis for her good-faith belief that her supervisors were appropriate law-enforcement

authorities. We rejected the same argument in Okoli, where agency policy required that supervisors

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forward reports of illegality to an internal Office of Inspector General. Id. at 616. There, the

Inspector General was charged with actual prosecutorial authority, and we noted it was an

appropriate law-enforcement authority under the Act. Id. at 614. Nonetheless, the reported-to

supervisors were not law-enforcement authorities, despite their duty to forward reports. Id. at 615.

We made clear that the report must be direct: “When an employee reports wrongdoing internally

with the knowledge that the report will have to be forwarded elsewhere . . . , then the employee is

not reporting ‘to an appropriate law[-]enforcement authority.’” Id. (emphasis and alteration in

original).

        Here, Resendez is even further removed from any law-enforcement authority than was the

plaintiff in Okoli. First, no one within TCEQ’s fraud-investigation program is empowered to enforce

any law—allegations instead must be reported outside the organization to the district attorney.

Second, the program is purposed with investigating fraud on the part of TERP-fund grantees, not

with reporting omissions on the part of TCEQ employees. The Act applies only to wrongdoing by

an agency or its employees, and the program’s existence does not support any belief Resendez held

that her supervisors could enforce Government Code section 321. See TEX . GOV ’T CODE

§ 554.002(a). Third, Resendez does not assert that she had any knowledge of the program when she

made her reports, and the record contains no evidence that the program was even in place during

Resendez’s time at TCEQ. In Okoli, the plaintiff at least received a memorandum spelling out that

reports would be forwarded to the Inspector General. 440 S.W.3d at 612–13. Resendez’s internal

reports, including that to Brymer, are insufficient under the Act.

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       Any report Resendez made to Senator Hinojosa’s office is likewise insufficient under the Act.

Senator Hinojosa is not a law-enforcement authority, and any belief that he was is not objectively

reasonable. “The Act, by its text and structure, restricts ‘law[-]enforcement authority’ to its commonly

understood meaning.” Gentilello, 398 S.W.3d at 689. A state senator’s function is to legislate—to

create law, not to enforce it. Resendez argues that as a member of the Texas Senate and the Texas

Legislative Council, Senator Hinojosa had the authority to investigate activities of state agencies.

Mere investigatory power is insufficient, however; the Act requires the power to investigate criminal

violations. TEX . GOV ’T CODE § 554.002(b)(2). While the Government Code violations Resendez

alleges are criminal, any investigatory power Senator Hinojosa had was legislative, not prosecutorial.

See id. § 323.006(a)(2) (“The council shall . . . conduct investigations and studies and make reports

that may be considered useful to the legislative branch . . . .”) (emphasis added). Further, Senator

Hinojosa was not a member of the council when Resendez reported to his office, and his future

service on the council adds nothing to her argument.

       Resendez argues that she has no special legal training and that it is objectively reasonable for

a layperson like herself to believe that a state senator has authority to investigate violations of law,

especially fraud on the government. We find no objectively reasonable basis for the belief that a

member of the Texas Legislature has the power to enforce any law or engage in a criminal

investigation. Resendez’s thirty-four years of service in Texas government renders any such belief

all the less reasonable. Resendez fails to establish that any belief she had that the senator was an

appropriate law-enforcement authority was in good faith under the Act.

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       Because Resendez cannot establish that her actions satisfy the Act’s requirements, TCEQ

remains immune from suit. Accordingly, and without hearing oral argument, we grant the petition for

review, reverse the court of appeals’ judgment, and dismiss the case. See TEX . R. APP . P. 59.1.

OPINION DELIVERED: November 21, 2014

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