Court Opinion

ID: 9737707
Source: CourtListenerOpinion
Date Created: 2023-08-26 19:32:38.266902+00
Date Added: 2024-06-11T07:24:00.819265
License: Public Domain

RATLIFF, Judge,
concurring in part, dissenting in part, and concurring in result.
Of the six issues presented in this appeal, I concur in the majority’s resolution of Issues I, II, III, IV, and VI. I find myself in disagreement with the majority opinion on Issue V, that of retaliatory discharge, the issue which the majority says is the heart of the appeal. For reasons hereinafter stated, I believe the “public policy exception” to the common law employment at will doctrine is available, in a proper ease, to protect the employee who finds himself the victim of retaliatory discharge for activities which have been referred to in some cases and by some writers as “whistle blowing.” The exception would grant a right of action for damages to the responsible whistle blower so discharged.
It is true Indiana has followed the traditional common law rule that an employment for an indefinite term not protected either by statute or collective bargaining agreement is terminable at the will of either employer or employee. Martin v. Platt, (1979) Ind.App., 386 N.E.2d 1026; Shaw v. S. S. Kresge Co., (1975) 167 Ind.App. 1, 328 N.E.2d 775, trans. den. Indeed, such is the rule not only in Indiana but also is the general rule. Pierce v. Ortho Pharmaceutical Corp., (1980) 84 N.J. 58, 417 A.2d 505; Tameny v. Atlantic Richfield Co., (1980) 164 Cal.Rptr. 839, 610 P.2d 1330; Harless v. First Nat. Bank in Fairmont, (W.Va.1978) 246 S.E.2d 270; Percival v. General Motors Corp., (8th Cir. 1976) 539 F.2d 1126.
Application of the common law majority rule permits the discharge of an at will employee at any time, with or without reason, and even when done maliciously. Recognition of the harsh results oft-times produced by rigid adherence to the traditional common law employment at will doctrine has given birth to an emerging doctrine generally designated as the “public policy exception” to the rule. Courts and writers have noted that the common law rule has its roots in nineteenth century legal formalism and laissez-faire labor policies which are not always valid in modern society. Pierce v. Ortho Pharmaceutical Corp., supra; Note: Protecting at Will Employees Against Wrongful Discharge: The Duty to Terminate Only in Good Faith, 93 Harv.L. Rev. 1816, 1824-28 (1980); Comment: Protecting the Private Sector at Will Employee Who “Blows the Whistle”: A Cause of Action Based Upon Determinants of Public Policy, 1977 Wis.L.Rev. 777, 782-83 (1977). Thus, courts have begun to place limitations upon the free and unfettered common law right of an employer to terminate at will an employee where that termination runs counter to some compelling public policy. As stated by the Supreme Court of West Virginia in Harless, supra:
“However, the general rule does not dispose of the issue in this case. There is a growing trend that recognizes that an employer may subject himself to liability if he fires an employee who is employed at will if the employee can show the firing was motivated by an intention to contravene some substantial public policy.”
246 S.E.2d at 273.
The New Jersey Supreme Court in Pierce, supra, said:
*1064“Commentators have questioned the compatibility of the traditional at will doctrine with the realities of modern economics and employment practices. [Citations omitted] .. . [M]any states have recognized the need to protect employees who are not parties to a collective bargaining agreement or other contract from abusive practices by the employer.
“Recently those states have recognized a common law cause of action for employees at will who were discharged for reasons that were in some way ‘wrongful’. ... Nearly all jurisdictions link the success of the wrongfully] discharged employee’s action to proof that the discharge violated public policy.” (Our insertion.)
417 A.2d at 509.
In Tameny, supra, the California Supreme Court stated:
“Over the past several decades, however, judicial authorities in California and throughout the United States have established the rule that under both common law and the statute [Labor Code 2922] an employee does not enjoy an absolute or totally unfettered right to discharge even an- at-will employee. In a series of cases arising out of a variety of factual settings in which a discharge clearly violated an express statutory objective or undermined a firmly established principle of public policy, courts have recognized that an employer’s traditional broad authority to discharge an at-will employee ‘may be limited by statute ... or by considerations of public policy.’ [Citations omitted.]” (Our insertion.)
610 P.2d at 1332-33.
The “public policy exception” has been created in recent years by a few courts to afford some means of protection to an at will employee whose discharge seriously undermines some compelling public policy.1 The method of protection has been to grant a cause of action for damages to the wronged employee.2
The Indiana Supreme Court has recognized the “public policy exception” in the landmark case of Frampton v. Central Indiana Gas Co., (1973) 260 Ind. 249, 297 N.E.2d 425. In that case, Frampton, an at will employee, contended she was discharged in retaliation because she exercised her statutory right to pursue a workmen’s compensation claim against her employer. The employer defended on the basis of the traditional common law employment at will doctrine asserting its absolute right to discharge Frampton even in, retaliation, although not admitting such questionable conduct. Justice Hunter, speaking for our Supreme Court, wrote:
“In summary, we hold that an employee who alleges he or she was retaliatorily discharged for filing a claim pursuant to the Indiana Workmen’s Compensation Act . . . has stated a claim upon which relief can be granted. We further hold that such a discharge would constitute an intentional, wrongful act on the part of the employer for which the injured employee is entitled to be fully compensated in damages. Of course, the issue of retaliation should be a question for the trier of fact.” 260 Ind. at 253, 297 N.E.2d at 429.
In Frampton, the court agreed that under ordinary circumstances, an employee at will may be discharged without cause. “However, when an employee is discharged solely for exercising a statutorily conferred right an exception to the general rule must be recognized.” 260 Ind. at 253, 297 N.E.2d at 429.
The Michigan Supreme Court has likewise recognized an exception to the common law rule granting a right of action against the employer to an at will employee discharged in retaliation for filing a workmen’s compensation claim. Sventko v. Kroger Co., (1976) 69 Mich.App. 644, 245 N.W.2d 151. A similar holding is found in Kelsay v. Motorola, Inc., (1978) 74 Ill.2d 172, 23 Ill.Dec. 559, 384 N.E.2d 353.
*1065Courts in other jurisdictions have extended the “public policy exception” to situations other than those in which an employee at will was terminated in retaliation for exercising a statutorily guaranteed personal right of the employee. Thus, in Petermann v. International Brotherhood of Teamsters, (1959) 174 Cal.App.2d 184, 344 P.2d 25, an employee discharged for refusal to give false testimony to a legislative committee was granted a right of action against his employer. The Petermann court reasoned that a directive to commit perjury, a criminal offense, contravened public policy; therefore, discharging the employee for his refusal to commit perjury was “obnoxious to the interests of the state and contrary to public policy and sound morality.” 344 P.2d at 27. Reuther v. Fowler & Williams, Inc., (1978) 255 Pa.Super. 28, 386 A.2d 119, recognized the existence of a cause of action for damages when an employee is discharged for having served jury duty. Nees v. Hocks, (1975) 272 Or. 210, 536 P.2d 512, is another ease involving retaliatory dismissal for jury service. Monge v. Beebe Rubber Co., (1974) 114 N.H. 130, 316 A.2d 549, applied the “public policy exception” to a claim by a female employee of retaliatory dismissal for refusal to go out with her foreman. Tameny v. Atlantic Richfield Co., supra, held that an employee who allegedly was fired because of his refusal to participate in an illegal gasoline price fixing scheme could maintain a tort action for damages against his former employer. Harless v. First Nat. Bank in Fairmont, supra, upheld a bank employee’s right to maintain an action for damages based upon alleged discharge in retaliation for bringing to the attention of his superiors alleged violations of consumer credit legislation and seeking to promote compliance with such laws.
These cases, and others, demonstrate three categories into which “public policy exception” cases fall: (1) where “a particular statute exists which gives a right to the discharged employee but not a corresponding personal remedy”; (2) where “a statute defines a public policy which the employer has breached, but .. . fails to express either a right or a remedy for the discharged employee”; and (3) where there is no statutory public policy, but a judicially declared public policy exists. 1977 Wis.L.Rev. 777, 787-88. In this third situation, the court is faced with the task of defining the policy and fashioning the remedy. Id. at 788.
The case before us in this appeal appears to be within the second category, that is, a statutorily defined public policy, not for the special benefit of the employee, but for the benefit of the general public. Congress has enacted the Food, Drug, and Cosmetic Act (21 U.S.C. 301 et seq.) and created the Food and Drug Administration (FDA) to regulate the drug industry in the United States. The FDA in turn has promulgated specific regulations to carry out the act. The purpose of such legislation and regulations is to ensure that all drugs and medications made available to the general public are reasonably safe. Here, Campbell contends his discharge was retaliatory because he reported to his superiors what he believed to be serious violations of the federally mandated regulatory scheme pertaining to drugs. Campbell asserts the declared public policy of the United States Congress pertaining to the drug industry required him to report such violations, and that Lilly’s action in discharging him, although his employment was at will, contravenes that clear public policy. Thus, Campbell reasons he is squarely within the “public policy exception.” He further describes himself as a “whistle-blower” and argues that public policy and the general welfare demand the extension of some measure of protection to the so-called whistle-blower who, responding to his public duty arising out of that public policy, reports violations only to find himself out of a job. It is this precise predicament which is the subject of the Comment in 1977 Wis.L.Rev. 777. This Comment urges extension of the “public policy exception” to the responsible whistle-blower.3 Indeed, the Harless case spe*1066cifically deals with the case of the whistle-' blower. In Harless the court stated that the West Virginia Consumer Credit and Protection Act represented a comprehensive effort by the legislature to protect consumers and persons obtaining credit. The Court went on to say:
“We have no hesitation in stating that the Legislature intended to establish a clear and unequivocal public policy that consumers of credit covered by the Act were to be given protection. Such manifest public policy should not be frustrated by a holding that an employee of a lending institution covered by the Act, who seeks to ensure that compliance is being made with the Act, can be discharged without being furnished a cause of action for such discharge.” 246 S.W.2d at 276.
In Pierce v. Ortho Pharmaceutical Corp., supra, the New Jersey Supreme Court held that an employee has a cause of action for wrongful discharge when the discharge is contrary to a clear mandate of public policy. Pierce further states that the wrongfully discharged employee may maintain a cause of action in contract or tort or both.4 The New Jersey court, however, found that Dr. Pierce was not discharged for reasons viola-tive of public policy, but rather because of her own personal opinions which differed from those of her employer.
In Martin v. Platt, supra, the Third District of this court rejected the contention that the “public policy exception” applied to employees allegedly discharged for reporting to a superior that their immediate superior was soliciting and receiving “kickbacks.” The opinion in Martin restricted application of the Frampton rule to cases where the employee was discharged in retaliation for having exercised a statutorily conferred personal right (e. g., a workmen’s compensation claim). The Martin court also alluded to cases, such as Nees and Petermann, where the employee was discharged for complying with a statutory duty, and presumably such reference was with approval. Martin, however, declined to declare unlawful the discharge of an employee at will where the reason for the discharge is contrary to general public policy, saying that the adoption of a “public policy exception” rule in such cases should be left to the legislature. In this assessment, I disagree. Courts have the capability to carve out exceptions to common law rules where strict adherence to such rule creates harsh and unjust results. The New Jersey Supreme Court said in Pierce at 417 A.2d 511:
“This Court has long recognized the capacity of the common law to develop and adapt to current needs. [Citations omitted.] The interests of employees, employers, and the public lead to the conclusion that the common law of New Jersey should limit the right of an employer to fire an employee at will.” (Our insertion.)
The writer of the Note on 93 Harv.L.Rev. 1816, at 1838 says:
“Courts possess the legitimate heritage of common law innovation that develops new principles to accommodate changing values, and are therefore an appropriate forum for the creation of job security rights. Because courts have considerable experience with similar employment relations problems, they possess sufficient expertise to resolve wrongful discharge disputes. Thus, courts need not await legislative initiative to effect doctrinal change in the employment at will area. Courts themselves created the at will rule; it is therefore entirely appropriate that they now take the lead in modifying it.'. . . ” (Footnotes omitted.)
I do not seek to establish by the judicial process a rule permitting only “good faith” discharges of at will employees as is advocated in the 93 Harv.L.Rev. 1816 Note. *1067Nor do I accept the rationale that there is an implied covenant of good faith and fair dealing limiting the right of termination existing in the employment at will relationship as found by the Supreme Judicial Court of Massachusetts in Fortune v. National Cash Register Co., (1977) 373 Mass. 96, 364 N.E.2d 1251. Rather, I would not so strictly limit the Frampton rule as did the Third District in Martin v. Platt, supra. Instead, I would extend the protection of the “public policy exception” to grant a right of action for damages to any employee at will whose wrongful and retaliatory discharge contravenes clearly established public policy. Further, I would grant such protection in all cases where the firing was obnoxious to such clearly declared or established public policy including all three categories previously mentioned. In my view, if the discharged employee could establish that he was dismissed in retaliation for the exercise of any right or duty granted or required by such strong public policy, he should recover damages.
Extension of the “public policy exception” to protect the so-called “responsible whistle-blower” is especially appropriate. A conscientious employee, albeit an employee at will, who, motivated by a sincere desire to further a clear and compelling public policy, either statutorily or judicially declared, calls to the attention of his employer or appropriate authorities facts revealing actual violations of such policy for the purpose of carrying out that clear public policy should not be subjected to retaliatory discharge without being provided with a remedy. The appropriate remedy, in my view, as supported by the cases and commentary cited herein, is a tort action for damages.5 Giving such a right of action for damages would serve as a deterrent to retaliatory discharge and would promote the very same strong and compelling public policy which the retaliatory discharge would violate. At the same time, in the case of the “whistle-blower,” limiting the right of action to the “responsible whistle-blower” serves to protect the employer from frivolous action based upon groundless claims motivated by harassment for personal gain or publicity. However, the need to extend such protection to the “responsible whistle-blower” is real. Neither crystal ball nor prophetic power is required in order to discern that if such a whistle-blower may be retaliatorily discharged without recourse, the intimidating effect upon other employees will ensure that the first whistle-blower will also be the last.
Therefore, it seems particularly appropriate in a case involving a matter of such great concern to,the general public as the development, manufacture, and distribution of drugs to extend the protection of the “public policy exception” to the at will employee wrongfully discharged contrary to the clear mandate of public policy. The fact that Congress has enacted comprehensive legislation regulating the drug industry and that extensive regulations in furtherance of the legislative regulatory scheme have been promulgated establishes the clear and compelling public policy relating to the industry. Consequently, if Campbell presented sufficient facts to raise a genuine issue of fact on the question of whether or not he acted responsibly in calling to the attention of his superiors actual violations of the drug laws, summary judgment should not have been entered against him. In such case, Campbell should have been permitted to proceed to trial, and if he could sustain his burden of proof that his discharge was retaliatory and in contravention of the clear mandate of public policy, he should prevail in an action for damages. The question thus becomes whether Campbell in fact presented a genuine issue of fact concerning his alleged wrongful discharge.
Summary judgment is an appropriate vehicle for disposing of cases expeditiously where legal issues exist and there are no genuine issues of material fact. Podgorny v. Great Central Ins. Co., (1974) 160 Ind.*1068App. 244, 311 N.E.2d 640. “The movant carries the burden of establishing the absence of a factual controversy and the evi-dentiary matters will be construed in a light most favorable to the nonmoving party.” Lee v. Weston, (1980) Ind.App., 402 N.E.2d 23, 24. However, while the burden is upon the party moving for summary judgment to establish that there is no genuine issue of material fact, and all doubts are resolved in favor of the non-moving party, nevertheless, the opposing party must set forth specific facts showing the existence of a genuine issue of fact for trial. Henderlong Lumber Co. v. Zinn, (1980) Ind.App., 406 N.E.2d 310; Lee v. Weston, supra; Walters v. Kellam & Foley, (1977) 172 Ind.App. 205, 360 N.E.2d 199, trans. den. Indiana Rules of Procedure, Trial Rule 56(E) provides in part:
“When a motion for summary judgment is made and supported as provided in this rule, an adverse party may not rest upon the mere allegations or denials in his pleading, but his response, by affidavits or as otherwise provided in this rule, must set forth specific facts showing that there is a genuine issue for trial... . ”
Here, Lilly filed a motion for summary judgment supported by an affidavit stating facts establishing that Campbell was an employee at will. The affidavit further stated that charges had been made by Campbell which Lilly investigated and found to be groundless. Campbell’s deposition was also submitted as part of the summary judgment hearing. At the hearing, the court permitted additional testimony. Campbell testified at the hearing. The essence of Campbell’s testimony was that the allegations of his complaint were true. This, in my opinion, is nothing more than standing on the mere allegations of his pleading, which, under T.R. 56 and Henderlong Lumber, supra; Lee, supra; and Walters, supra, is insufficient. Further, a review of Campbell’s deposition reveals no specific facts sufficient to give rise to any genuine issue of material fact that Campbell was discharged in retaliation for reporting any violations of the Food, Drug, and Cosmetic Act or FDA regulations, or that other Lilly employees engaged in any activity condemned by clear and compelling public policy. Campbell pointed to no specific facts showing any concealment of any testing or data that the drugs to which he refers were hazardous, or to any falsification of any records, or failure to report any test results. In fact, his testimony shows that his tests revealing possible lethal effects of one of the drugs was reported to the FDA and that the drug has never been placed on the market. Also, Campbell’s deposition clearly established as a primary interest of his a desire to be rewarded for allegedly saving Lilly vast sums of money which they would have been compelled to pay in judgments had not his test results revealed the potential hazard of a certain drug.6 Clearly, Campbell has not met the requirements of T.R. 56(E) or of the pronouncements of this court in the Henderlong Lumber, supra; Lee, supra; and Walters, supra; cases. He has not shown the existence of any genuine issue of fact which would bring him within the protection of the “public policy exception” to the employment at will doctrine as that exception should be extended to the “responsible whistle-blower.”
Therefore, although I dissent from the majority view restricting the “public policy exception” to the narrow confines of Frampton as interpreted by Martin v. Platt, supra, I am compelled to concur in the result reached by the majority. My concurrence, however, is based upon the opinion that Campbell did not show the existence of a genuine issue for trial, thus summary judgment was properly entered against him.

. See Comment: 1977 Wis.L.Rev. 777 at 786-99 for an excellent treatment of the development of the “public policy exception” and defining the parameters of the exception.

. Note: 93 Harv.L.Rev. 1816 at 1822. The “public policy exception” is discussed at 1822-24 of this note.

. See 1977 Wis.L.Rev. at 778, fn. 10 relative to differentiation between a “responsible” whistle-blower and an “irresponsible” one. An “irresponsible” whistle-blower is one who seeks *1066to embarrass his employer by groundless accusations for his own personal motives.

. In Tameny, the California Supreme Court held such action to be in tort. Harless also says the action is in tort. The language from Frampton, previously quoted in this opinion seems to sound in tort. The Note in 93 Harv.L. Rev. 1816 at 1843 suggests the tort theory to be preferable.

. Campbell’s demand for reinstatement would not be within the remedy so provided. The action for damages would be the only remedy.

. Campbell contended Lilly had saved five hundred million dollars it would have had to pay in settlement of death claims but for his discoveries. He suggested many times that he was due a substantial reward, two hundred million dollars being suggested in his complaint.