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Chapins v. Northwestern Community Services Board

United States District Court, W.D. Virginia, Harrisonburg Division

March 20, 2017



          Michael F. Urbanski United States District Judge

         This is an employment dispute. Plaintiff Kathy A. Chapins brings claims against her former employer, Northwestern Community Services Board ("Northwestern"), of retaliation and age discrimination under the False Claims Act ("FCA"), 31 U.S.C. § 3729, et seq., and the Age Discrimination in Employment Act ("ADEA"), 29 U.S.C. § 621, et seq.. respectively. Before the court is Northwestern's motion for summary judgment. ECF No. 17. The matter has been fully briefed, and the court heard oral argument on March 3, 2017. For the reasons set forth below, the court finds that Chapins has failed to establish a genuine issue of material fact, and Northwestern is entitled to judgment as a matter of law on both counts. Accordingly, the court GRANTS Northwestern's motion for summary judgment (ECF No. 17). Northwestern's Motion in Limine (ECF No. 26), is DENIED as moot.


         Defendant Northwestern oversees "an array of outpatient, case management, day support, residential and emergency programs" designed to help adults and children combat addiction, mental illness, and emotional/behavioral disorders. What we do for you and your family, Northwestern Community Services (last visited Mar. 3, 2017), Chapins began her employment at Northwestern in 2003, and from February 2011 through June 13, 2014 worked as the Office Manager at Northwestern's Shenandoah County Youth Services Center. ECF No. 1, ¶ 8. In February 2011, "Chapins reported her suspicions" that a coworker, Clare Matthews, had submitted false Medicaid claims and timesheets to her supervisor, Barbara Kibler.[1] Id. ¶ 10. As a result, Matthews was suspended, and later terminated after her position was eliminated. Id. ¶ 11. After reporting Matthews, Chapins claims she experienced harassment at the hands of Matthews' subordinates, resulting in Chapins' hospitalization due to stress in July 2011. Id. ¶ 12. Chapins argues that Kibler and Chief Operations Officer Mark Gleason mischaracterized this harassment as a "relationship problem, " and threatened her with transfer or termination if she could not resolve her differences with her coworkers. Id. ¶ 13. As a result, in December 2011, Chapins filed a grievance against Gleason; Chief Financial Officer David Toth subsequently dismissed her grievance, and assured her "there was no threat of termination or transfer." Id. ¶¶ 14, 16. Subsequently, however, Toth retired, and, according to Chapins, "Gleason resumed his campaign of hostility." Id. ¶ 17.

         In spring 2014, Northwestern discontinued the Therapeutic Day Treatment Program (the "TDT program"), on which Chapins worked.[2] Id. ¶ 18. Chapins, along with thirty-three others, were terminated when the TDT program was discontinued. Id.; see ECF No. 18, at 11. After receiving her termination notice, Chapins applied for a different position (die "Office Manager II position"). ECF No. 1, ¶ 20. Kibler delayed the hiring process to allow Chapins and her coworker, Sarah Clark, to apply. ECF No. 18, at 15; see Kibler Dep. Tr., ECF No. 24, at 45:19. In fact, Chapins and Clark were the only applicants; both interviewed, and both received high scores on their interview evaluations. ECF No. 18, at 15. However, Chapins alleges that her interview, conducted by Gleason and Kibler, was "hostile, intimidating and antagonistic." ECF No. 1, ¶ 21. Ultimately, Chapins was not chosen for the position, and Clark, seventeen years her junior and thus not within the class of protected persons under the ADEA, was. Id. ¶¶ 22, 25.

         Chapins filed suit in May 2016. She first alleges that Nordiwestern retaliated against her for reporting Matthews: "Chapins was threatened, harassed, terminated and not selected for a position for which she was the more qualified applicant by Northwestern in violation of the [FCA]." Id. ¶ 29. Second, Chapins alleges that Northwestern discriminated against her on account of her age, in violation of the ADEA, "by selecting a lesser qualified applicant of a non-protected status for the Office Manager [II] position." Id. ¶ 33. In response, Northwestern answered, ECF No. 5, before filing a motion for summary judgment on January 25, 2017. ECF No. 17.


         Pursuant to Federal Rule of Civil Procedure 56(a), the court must "grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(a); Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986); Glynn v. EDO Corp., 710 F.3d 209, 213 (4th Cir. 2013). When making this determination, the court should consider "the pleadings, depositions, answers to interrogatories, and admissions on file, together with . . . [any] affidavits" filed by the parties. Celotex, 477 U.S. at 322. Whether a fact is material depends on the relevant substantive law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). "Only disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment. Factual disputes that are irrelevant or unnecessary will not be counted." Id. (citation omitted). The moving party bears the initial burden of demonstrating the absence of a genuine issue of material fact. Celotex, 477 U.S. at 323. If that burden has been met, the non-moving party must then come forward and establish the specific material facts in dispute to survive summary judgment. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586-87 (1986).

         In determining whether a genuine issue of material fact exists, the court views the facts and draws all reasonable inferences in the light most favorable to the non-moving party. Glynn, 710 F.3d at 213 (citing Bonds v. Leavitt. 629 F.3d 369, 380 (4th Cir. 2011)). Indeed, "[i]t is an 'axiom that in ruling on a motion for summary judgment, the evidence of the nonmovant is to be believed, and all justifiable inferences are to be drawn in [her] favor.'" McAirlaids. Inc. v. Kimberly-Clark Corp., No. 13-2044, 2014 WL 2871492, at *1 (4th Cir. June 25, 2014) (internal alteration omitted) (citing Tolan v. Cotton, 134 S.Ct. 1861, 1863 (2014) (per curiam)). Moreover, "[c]redibility determinations, the weighing of the evidence, and the drawing of legitimate inferences from the facts are jury functions, not those of a judge . . . ." Anderson. 477 U.S. at 255. However, the non-moving party "must set forth specific facts that go beyond the 'mere existence of a scintilla of evidence.'" Glynn, 710 F.3d at 213 (quoting Anderson, 477 U.S. at 252). Instead, the non-moving party must show that "there is sufficient evidence favoring the nonmoving party for a jury to return a verdict for that party." Res. Bankshares Corp. v. St. Paul Mercury Ins. Co., 407 F.3d 631, 635 (4th Cir. 2005) (quoting Anderson, 477 U.S. at 249). "In other words, to grant summary judgment the [c]ourt must determine that no reasonable jury could find for the nonmoving party on the evidence before it." Moss v. Parks Corp., 985 F.2d 736, 738 (4th Cir. 1993) (citing Perini Corp. v. Perini Const. Inc., 915 F.2d 121, 124 (4th Cir. 1990)).


         The court first considers Chapins' FCA claim. The anti-retaliation provision of the FCA prohibits adverse action against employees because of "lawful acts done ... in furtherance of an action under this section or other efforts to stop 1 or more violations of this subchapter." 31 U.S.C. § 3730(h). To establish retaliation, a plaintiff must show (1) she engaged in "protected activity, " (2) her employer knew about that activity; and (3) her employer took action against her as a result. Glynn v. EDO Corp., 710 F.3d 209, 214 (4th Cir. 2013).

         Northwestern argues it is entitled to summary judgment on the first and third requirements. First, reporting Matthews for discrepancies in her timesheets does not constitute protected activity because "there is no evidence in the record that [Northwestern], the employer, had or intended to commit a fraud against the government." ECF No. 18, at 9. As to the third requirement, Northwestern argues that its conduct "neither occurred within the [statutory] limitations period nor rises to the level of retaliation[, ] and that the decisions with respect to [Chapins'] termination and non-selection for an office manager position were based on legitimate business reasons unrelated to [Chapins'] reports three years earlier." Id. at 9-10. Though Chapins likely engaged in protected conduct when she reported Matthews' for inaccurate billing, the court agrees that Chapins has failed to show that a reasonable jury could find that Northwestern retaliated against her. Because all three elements are necessary to establish a retaliation claim, this failure compels the grant of summary judgment to Northwestern.

         A. Protected Activity

         Congress amended 31 U.S.C. § 3730(h) in 2010 by adding "efforts to stop 1 or more violations" of the FCA as protected activity under the statute. Thus, employee action is protected if it is taken (1) "in furtherance of an action" under the FCA, or represents (2) "other efforts to stop 1 or more" FCA violations. 31 U.S.C. § 3730(h). Proof that the FCA has been violated is not necessary to establish protected activity. Graham Cty. Soil & Water Conservation Dist. v. United States ex rel. Wilson, 545 U.S. 409, 416 n.l (2005). In fact, in some circumstances, § 3730(h) "protects an employee's conduct even if the target of an investigation or action to be filed [is] innocent." Id. at 416.

         Activity is protected under the first prong if it meets the "distinct possibility" standard. Mann v. Heckler & Koch Def. Inc.. 630 F.3d 338, 344 (4th Cir. 2010); Layman v. MET Labs. Inc.. No. RDB-12-2860, 2013 WL 2237689, at *7 (D. Md. May 20, 2013). "Under this standard, protected activity occurs when an employee's opposition to fraud takes place in a context where 'litigation is a distinct possibility, when the conduct reasonably could lead to a viable FCA action, or when . . . litigation is a reasonable possibility.'" Mann, 630 F.3d at 338 (ellipsis in original) (quoting Eberhardt v. Integrated Design & Const. Inc., 167 F.3d 861, 869 (4th Or. 1999)).

         The second prong ("other efforts to stop" FCA violations) protects a wider range of activity. Carlson v. DynCorp Int'l LLC. 657 F.App'x 168, 171 (4th Cir. 2016); see Smith v. Clark/Smoot/Russell, 796 F.3d 424, 434 (4th Cir. 2015) (second prong "plainly encompasses more than just activities undertaken in furtherance of a False Claims Act lawsuit"). In Carlson, the plaintiff argued he was retaliated against for his efforts to stop an FCA violation by his employer. 657 F.App'x at 168-69. The court "assume[d], without deciding, " that "efforts to stop 1 or more violations" are "protected activity where those efforts are motivated by an objectively reasonable belief that the employee's employer is violating, or soon will violate, the FCA."[3] Id. at 172.

         Northwestern argues Chapins cannot prevail under either prong; because "there is no evidence that [Chapins] intended to file a qui tarn suit, " her actions cannot have been taken "in furtherance of an FCA action. ECF No. 18, at 8. Moreover, under the second prong, Northwestern argues that Chapins cannot have had a reasonable, good faith belief that it would have violated the FCA, because, "once [Chapins] reported her initial concerns, she learned of the various efforts to prevent [fraudulent billing] and was requested to assist in verifying time for employees of the TDT program." Id. at 9 (footnote omitted). The court disagrees.

         Even accepting that, once Chapins reported Matthews, she was confronted with incontrovertible proof that Northwestern would not submit fraudulent bills to the government, this still does not rebut Chapins' contention that she harbored an objectively reasonable belief that an FCA violation might occur before and during the process of reporting Matthews. The FCA does not define protected conduct so narrowly; in particular, protected conduct does not lose this status simply because the whistleblower later learns information that disproves her belief in an FCA violation. Instead, to be protected as a whistleblower, Chapins need only "evince some attempt to expose possible fraud, " and provide "some suggestion of impropriety or illegality by the employer." United States ex rel. Owens v. First Kuwaiti Gen. Trading & Contracting Co., 612 F.3d 724, 735 (4th Cir. 2010).

         Chapins meets this burden: viewing the facts in her favor, she has demonstrated a good faith, objectively reasonable belief in potential fraud against the government. Chapins "reported her suspicions" that Matthews "submitted false claims for Medicaid and false timesheets to her direct [s]upervisor, Barbara Kibler." ECF No. 19, at 2. These suspicions were based on "numerous instances of inaccurate documentation being submitted for Medicaid reimbursement, " which Chapins had observed for "a couple of years, . . . minimum." Chapins Dep. Tr., ECF No. 25, at 20-21. When asked for examples, Chapins responded,

[T]here's no way that I can recall the countless situations that were dishonest from her. She would sign off on documentation, for instance, that-and then allow it to be billed knowing that she had never met the requirements that Medicaid set forth for that particular document. That happened countess times, way too many for me to recall.
She would lie to her supervisor.

Q: About what?

A: Everything, where she was, what time she was there, what she was doing, and the list goes on.

Id. at 20:21-21:17. Most importandy, there is no suggestion in die record mat, during her investigation of Matthews' conduct, Chapins was aware of Northwestern's internal auditing procedures, or any other facts that would suggest that Matthews' fraudulent claims would not be passed on to the government. In the absence of such information, Chapins behaved reasonably in believing that Matthews' false claims would be accepted by her employer and would ultimately result in fraud on ...

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