Opinion
No. E2008-00525-COA-R3-CV.
November 6, 2008 Session.
Filed March 31, 2009.
Appeal from the Circuit Court for Hamilton County; No. 05C556; W. Jeffrey Hollingsworth, Judge.
Judgment of the Circuit Court Vacated in Part and Affirmed in Part; Case Remanded.
Michael A. Anderson, Chattanooga, Tennessee, for the appellants, Timmy Sykes and Curtis Greene.
Stacie L. Caraway and Larry L. Cash, Chattanooga, Tennessee, for the appellees, Chattanooga Housing Authority and Jeff Hazelwood.
Charles D. Susano, Jr., J., delivered the opinion of the court, in which Herschel P. Franks, P.J., and D. Michael Swiney, J., joined.
OPINION
Timmy Sykes and Curtis Greene ("Employees"), who were public safety officers of the Chattanooga Housing Authority ("CHA"), sued CHA and the chief of the CHA safety department, Jeff Hazelwood ("Chief Hazelwood"). CHA was sued for retaliatory discharge under Tenn. Code Ann. § 50-1-304 (2008), the code section addressing an employee's "discharge[] or terminat[ion] solely for refusing to participate in, or for refusing to remain silent about, illegal activities." Employees also sued under Tenn. Code Ann. § 4-21-301(2005) for retaliation for having opposed practices of discrimination. In addition, Employees assert that Chief Hazelwood intentionally interfered with their contracts of employment. Employee Sykes claims that Chief Hazelwood defamed him. CHA and Chief Hazelwood ("the Defendants") filed a motion for summary judgment, which the trial court granted in full. We hold that Employee Sykes may proceed under Tenn. Code Ann. § 50-1-304, but that Employee Greene may not. We vacate the summary judgment on Employees' claims under the Tennessee Human Rights Act of retaliation for having opposed discriminatory practices. Furthermore, we vacate the trial court's grant of summary judgment on the claims against Chief Hazelwood for interference with Employees' employment contracts. Finally, we affirm the court's grant of summary judgment as to Employee Sykes' claim of defamation. Case remanded for further proceedings, consistent with this opinion.
I.
The federally-subsidized CHA, a governmental entity, operates housing developments in Chattanooga that provide housing for low-income families. Employees, African-Americans, worked under the supervision of Chief Hazelwood, a Caucasian. Employees both had prior law enforcement experience before becoming employed by CHA. Chief Hazelwood was hired at the inception of CHA. He had formerly worked as the chief of the safety department of the housing authority in Knoxville. Chief Hazelwood, in turn, hired several Knoxville officers, including Officer Vess, a Caucasian. Chief Hazelwood made Officer Vess the Assistant Chief of the department.
Employees rely upon the following facts. During their employment, Employees personally witnessed allegedly unconstitutional and illegal searches of residences and seizure, as well as incidents of excessive force and racial profiling which, they claim, Chief Hazelwood, Officer Vess, and other CHA employees participated in, encouraged or condoned. The Employees personally observed such incidents. Furthermore, residents reported incidents to the Employees when they were performing their duties in the housing projects.
According to Employees, Chief Hazelwood and Officer Vess used abusive language with residents, who are primarily African-Americans, including the use of the "n" word. According to Employees, Chief Hazelwood insisted that officers regularly wear tactical gear during routine police work in the housing developments, and he and Officer Vess ordered illegal and unconstitutional roadblocks within the developments to check identification of young male African-Americans.
We note, in passing, that a person arrested at a roadblock at an identification checkpoint at the entrance to a CHA housing project moved to suppress evidence collected as a result of the stop, claiming the stop was an unconstitutional seizure. The Supreme Court held that a checkpoint at which officers stop and question persons attempting to enter a public housing development when the conduct of the persons is unremarkable and free from suspicion is an unreasonable seizure and a violation of the United States and Tennessee Constitutions. State v. Hayes , 188 S.W.3d 505, 508 (Tenn. 2006).
Employee Sykes complained to his direct supervisors, and in June or July 2004, he met with Bob Dull, who was a supervisor at CHA. Sykes asked for assurances that he would not be retaliated against if he complained about allegedly illegal incidents he had observed. He then expressed his concerns about policing and patrolling, including the entering of homes without search warrants and other illegal actions. He also made complaints to Mr. Dull on other occasions. In June or July 2004, Employees met with a member of the CHA board and ultimately had separate meetings with Andrew Lawrence, Human Resources Manager.
On June 22, 2004, Chief Hazelwood met with Employee Sykes and presented him with a "Performance Improvement Plan." There is a dispute between the parties as to whether the meetings with Mr. Dull occurred before or after Chief Hazelwood issued the performance plan. But, according to Employee Sykes, Chief Hazelwood cursed him during the meeting and was upset that he had gone to Hazelwood's superiors to complain.
On June 24, following the meeting about the improvement plan, Employee Sykes filed a grievance of the plan in which he also raised the issue of illegal racial profiling. According to Employee Sykes, Chief Hazelwood and Officer Vess developed a list of names of some 1,000 people — mainly African-American males aged 19-35 — that they and other CHA officers were instructed to keep out of the housing developments. Employees believed that the instruction was racial profiling. In addition, they assert that Chief Hazelwood and Officer Vess, without authority to do so, set up an "Appeals Hearing Committee" to review complaints of individuals who had been barred from the projects because of their inclusion on the criminal trespass list. Chief Hazelwood and Officer Vess made themselves members of the Committee. Since they were the individuals who primarily created the list, Employees also believed that individuals on the list could not receive due process. Employees asserted that the situation discriminated against and violated the civil rights of the primarily African-American persons on the list.
On July 27, Employees had separate meetings with Mr. Lawrence over their individual grievances. At Mr. Lawrence's request, Employee Greene wrote a follow-up letter. There are discrepancies between the report of the meeting as written by CHA and the letter of Employee Greene, but it is clear that Employee Greene made allegations concerning illegal actions of Chief Hazelwood and Officer Vess. It is also clear that he complained of a racially hostile work environment and that he raised concerns about racist behavior on the part of Chief Hazelwood and Officer Vess.
According to Employees, they provided Chief Hazelwood copies of their grievances and, immediately thereafter, Employees began to be treated differently from other officers. Employees are not aware of any investigation of their grievances and received no formal responses. But, once they filed the grievances, they were told not to talk to board members. In addition, according to them, they began to be cold-shouldered by their fellow officers, who expressed concern that the department would be penalized due to Employees' complaints.
The trial court abused its discretion in striking Employee Sykes' personal observations that he was aware of no investigation and received no formal response. The statements are neither speculation nor hearsay, but a statement of the knowledge of the Employee at the pertinent times. If the Defendants conducted an investigation, that is for Defendants to prove. Contrary to the trial court's holding, there is no problem of hearsay in Employee Sykes' recounting that Mr. Lawrence said he would look into the allegations. Mr. Lawrence is the representative of CHA who was primarily charged with handling the issues raised by Employees and the statement was made within the scope of his agency. The same is true of Employee Greene's statement that no meaningful action was taken to address his allegations.
Because of the degree of hostility toward him after he filed his grievance, Employee Sykes asked for a special assignment — the seeking out of incidents of fraud by residents against CHA. With Officer Vess' permission, Employee Sykes scheduled a meeting on August 25, 2004, with the staff of the Office of Inspector General about what he had found. Before the meeting, both Mr. Dull and Mr. Lawrence told Employee Sykes not to discuss his grievance during his meeting. An hour before the meeting, Officer Vess called Employee Sykes and told him not to meet with the inspectors. Then Officer Vess, Mr. Lawrence and others delivered a written notice of suspension to Employee Sykes. The notice indicated Employee Sykes was on administrative leave "pending the outcome of an internal investigation." Neither the notice nor Officer Vess personally gave Employee Sykes a reason for the suspension, but, when pressed, Mr. Lawrence said it was based on a complaint that Employee Sykes had made a sexually harassing remark to a female resident.
In fact, however, Employee Sykes had already contacted the Office of the Inspector General to find out how to file his grievance and had discussed its contents.
On August 30, 2004 — following his suspension — Employee Sykes filed a charge of discrimination with the Tennessee Human Rights Commission ("THRC"). CHA knew that Employee Sykes was going to file a charge of discrimination because he had disclosed that fact in his grievance filed earlier in August 2004. CHA received notice that the charge had been filed on September 10, 2004.
The investigators of the allegations against Employee Sykes of a sexual remark were Mr. Lawrence, to whom Sykes had made internal complaints about illegal activities, and Officer Vess, one of the individuals Sykes claimed had engaged in illegal activities. Employee Sykes claims that CHA did not follow its personnel policy regarding the handling of his grievance.
Employee Sykes' employment was terminated on September 30, 2004. Although he was terminated during a meeting with Mr. Lawrence and Officer Vess, they did not tell him the findings of their investigation or even that an investigation had been conducted. Officer Vess said that he and Chief Hazelwood recommended that Employees Sykes' employment be terminated.
The separation notice Employee Sykes received gave no reason for his termination. When Employee Sykes applied for unemployment compensation, CHA once again did not supply a reason for his termination. It was only after Employee Sykes filed a grievance of the performance improvement plan, stating that he was going to file a charge of discrimination, that CHA asserted reasons for his suspension other than the allegation of a sexual remark made to a resident.
Several months after the termination of Employee Sykes' employment, and without disclosing the charges Employee Sykes had made against him, Chief Hazelwood went to the Police Officers' Standards and Training Commission ("the POST Commission") seeking to have Sykes decertified as an officer. Decertification would mean that Employee Sykes could not work anywhere in Tennessee as a law enforcement officer. The matter was pending at the time of the hearing below.
On October 4, 2004, less than a week after Employee Sykes was terminated, Employee Greene received a three-day suspension without pay for violation of the cell phone usage policy. Employee Greene testified at his deposition that Chief Hazelwood had told officers that as long as they paid the overages, he didn't care if officers made personal use of the CHA-issued cell phones. According to Employee Greene, he was not aware, until he was suspended, of the CHA policy that personal use of CHA phones was only to be incidental. According to him, all officers of CHA used their phones for personal calls.
Ultimately, there was a meeting with Officer Vess, Mr. Lawrence, and Mr. Dull about the issue. During the meeting the parties agreed that Employee Greene could pay in installments what CHA said he owed, but Employee Greene was nonetheless suspended. When Greene returned to work, Officer Vest gave him desk duty, took away his cell phone and vehicle, and removed him as the person who made the schedules for contract officers. Officer Vess told him that the desk duty was due to his cell phone overages and that his police duties would be restored to him when he became a "team player" and did what officers needed to do. Officer Vess assigned Employee Greene to work from 5:00 p.m. to 3:00 a.m. Wednesday through Saturday at the desk job.
In December 2004, Employee Greene took leave under the Family Medical Leave Act ("FMLA"). When Employee Greene returned in January, Mr. Lawrence and Officer Vess terminated his employment, saying that he had violated the cell phone use policy. He was fired on January 19, 2005. When he reviewed the documentation CHA provided, Employee Greene realized that CHA had calculated every minute of night and weekend use even though those periods were free. Despite the written policy of CHA, Employee Greene is not aware of any other officer under Chief Hazelwood being disciplined due to personal use of their CHA cell phone.
Employee Greene filed a grievance over his termination. He also filed a charge of discrimination with the THRC.
The Defendants have a different view of what transpired in this case. They say that Employee Sykes was a chronic complainer who believed that he was treated differently because he was from Texas and who believed that Chief Hazelwood gave preferential treatment to the officers he hired from Knoxville.
The Defendants purport to use a 2002 discipline of Employee Sykes that was disputed and removed from his file by the human resources director. Contrary to the holding of the trial court, we view this discipline to be inadmissible since it was made in resolution of the dispute, and the parties agreed it could not to be used against the employee. Defendants may not resurrect it now.
The Defendants say that Employee Sykes and Chief Hazelwood worked together "without significant incident" until June 22, 2004, when Hazelwood gave Sykes a Performance Improvement Plan. The Defendants describe Employee Sykes' reaction upon his receipt of the plan as volatile.
Defendants argue that Employee Sykes and Employee Greene were not motivated in good faith to report the illegal activities about which they complained to management and about which they grieved. Rather, according to the Defendants, Anne Wadley — a member of the CHA board who"openly despised Hazelwood" and blamed him for a violent altercation between CHA officers and residents at the Poss Homes development — invited Employees Sykes and Greene to talk to CHA's board chair, Anne Henniss, and other management in July 2004.
After the July meeting, Anne Hennis contacted Robert Dull, the Deputy Director of Asset Management, and explained that Employees Sykes and Greene had serious concerns about the program. She wanted Chief Hazelwood fired. Mr. Dull said there would have to be an investigation before a decision could be made. Mr. Dull then asked Mr. Lawrence to meet with Employees Sykes and Greene and investigate their concerns.
These meetings took place on July 27, 2004. The Defendants claim that the issues raised were all concerning policy matters. However, they acknowledge that Employees Sykes and Greene claimed that Chief Hazelwood was engaging in "illegal racial profiling." At the conclusion of the meetings, Mr. Lawrence says that he told Employee Sykes that the concerns would be investigated and that, if Sykes felt he was being retaliated against, he should return to see him. According to the Defendants, Employee Sykes never returned.
The Defendants claim that after meeting with Employees Sykes and Greene, Mr. Lawrence interviewed all of the members of CHA and found no support for any of the issues raised. The Defendants also say that an independent consulting firm was hired in late August 2004 to evaluate concerns of board member Wadley and CHA residents. The report was not completed until after the employment of Employees Sykes and Greene was terminated, but CHA says that "the independent investigation did not verify any of the [Employees'] concerns." Employees Sykes and Greene say that no one from the consulting firm ever talked to either of them.
According to the Defendants, on August 19, 2004, two residents complained about Employee Sykes at an Area Residents' Council Meeting, saying that one was being evicted because she refused to have sex with Sykes. CHA put Sykes on suspension on August 25, 2004. As the Employees' brief notes, these residents did not give statements until after Employee Sykes had been suspended. The Defendants' brief does not say which CHA employees conducted the investigation, but it says that Chief Hazelwood was not involved. There is a dispute between the parties as to the role Officer Vess played in the investigation.
The Defendants say that, during the investigation, other problems came to light. For example, the Defendants claim that when Employee Sykes was suspended, officers found in his desk unsecured evidence as well as issued citations that had not been filed with the court. The circumstances of these additional allegations against Employee Sykes are hotly disputed.
As to Employee Greene, the Defendants say that he repeatedly ignored requests for payment of overages on his cell phone account. The Defendants claim that Employee Greene admitted that he did not have a personal cell phone and was using the CHA-issued phone for both his personal and business calls. CHA's policy provided that CHA-issued cell phones were for business use and any personal use was to be incidental. According to the Defendants, Employee Greene did not pay the overages as agreed and, while on FMLA leave, made 1,044 calls that he admitted were personal calls. The Defendants argue that the suspension and subsequent duty changes were not retaliatory, but a result of Greene's failure to pay the overages. As to Employee Greene's assignment to work a desk job from 5:00 p.m. to 3:00 a.m. on a schedule of Wednesday to Saturday, Defendants say that, when Greene complained, the human resources office overruled this part of the discipline and changed his schedule to regular office hours.
On November 3, 2004, Officer Greene filed a charge of discrimination with the THRC. CHA received notice of the charge on November 15, 2004.
The Defendants say: "The record is undisputed that [Chief] Hazelwood was not involved in the . . . terminations." However, Officer Vess testified at his deposition that he and Chief Hazelwood made the recommendation to terminate Sykes' employment.
II.
The issues on appeal, as stated by Employees Sykes and Greene, are:
Whether the Trial Court erred in finding that [Employees'] terminations were not in violation of Tenn. Code Ann. § 50-1-304 when they were terminated following complaints about unconstitutional and illegal activities by their police department.
Whether the Trial Court erred in finding that [Employees'] terminations were not in violation of the Tennessee Human Rights Act.
Whether the Trial Court erred in finding that [Employees] did not establish a claim against their supervisor, [Chief] Hazelwood, for his intentional interference with their employment.
Whether the Trial Court erred in finding that Employee Sykes failed to establish a claim against [Chief] Hazelwood for defamation.
III.
In our review of a grant of summary judgment there is no presumption of correctness accorded to the trial court's determinations. Id. The evidence must be "view[ed] in the light most favorable to the nonmoving party." Eyring v. Fort Sanders Parkwest Med. Ctr., Inc. , 991 S.W.2d 230, 236 (Tenn. 1999). The court must "take the strongest legitimate view of the evidence in favor of the nonmoving party, allow all reasonable inferences in favor of that party, and discard all countervailing evidence." Byrd v. Hall , 847 S.W.2d 208, 210-11 (Tenn. 1993) (citations omitted). Then, if there is a dispute as to any material fact or any doubt as to the conclusions to be drawn from that fact, the motion must be denied. Id. at 211 (citation omitted).
In Hannan v. Alltel Publ'g Co. , 270 S.W.3d 1 (Tenn. 2008), the Tennessee Supreme Court recently addressed the burden-shifting analysis in summary judgment cases. The Court initially stated the general premises that have been the law of this State under Byrd v. Hall , 847 S.W.2d 208 (Tenn. 1993), as follows:
Summary judgment is appropriate when the moving party can show that there is no genuine issue of material fact and that it is entitled to judgment as a matter of law. Tenn. R. Civ. P. 56.04; Byrd v. Hall , 847 S.W.2d 208, 214 (Tenn. 1993). In Byrd , this Court set out the basic principles involved in determining whether a motion for summary judgment should be granted. The moving party has the ultimate burden of persuading the court that "there are no disputed, material facts creating a genuine issue for trial . . . and that he is entitled to judgment as a matter of law." Byrd , 847 S.W.2d at 215. If the moving party makes a properly supported motion, the burden of production then shifts to the nonmoving party to show that a genuine issue of material fact exists. Id.
Hannan , 270 S.W.3d at 5. The Court then said that "in Tennessee, a moving party who seeks to shift the burden of production to the nonmoving party who bears the burden of proof at trial must either: (1) affirmatively negate an essential element of the nonmoving party's claim; or (2) show that the nonmoving party cannot prove an essential element of the claim at trial." Id. at 8-9.
In this case the parties rely almost exclusively on federal court cases applying Tennessee substantive law and federal procedural law. It is significant to note that the Tennessee Supreme Court has explicitly stated that "a moving party's burden of production in Tennessee differs from the federal burden." Hannan , 270 S.W.3d at 8. The High Court noted: "It is not enough for the moving party to challenge the nonmoving party to `put up or shut up' or even to cast doubt on a party's ability to prove an element at trial." Id.
IV. A. 1.
Employees have pled a cause of action for retaliatory discharge under Tenn. Code Ann. § 50-1-304 (2008). While the employment-at-will doctrine has long been recognized in Tennessee, the Supreme Court, in recent years, has created exceptions to that doctrine, exceptions which prevent an employer from firing an at-will employee when doing so would violate a clearly established public policy. Collins v. AmSouth Bank , 241 S.W.3d 879, 884 (Tenn.Ct.App. 2007). Id.
In 1990, the Tennessee General Assembly adopted Tenn. Code Ann. § 50-1-304 as part of the Public Protection Act of 1990. Collins , 241 S.W.3d at 884. The statute, which is commonly referred to as the "Whistleblower Act," is an exception to the common law employment-at-will doctrine. Id. The statute provides, in pertinent part, as follows:
(b) No employee shall be discharged or terminated solely for refusing to participate in, or for refusing to remain silent about, illegal activities.
* * *
(d)(1) Any employee terminated in violation of (b) shall have a cause of action against the employer for retaliatory discharge and any other damages to which the employee may be entitled.
Tenn. Code Ann. § 50-1-304(2008).
There are four elements in a case under Tenn. Code Ann. § 50-1-304:
(1) Plaintiff's status as an employee;
(2) Plaintiff's refusal to participate in, or to remain silent about, illegal activities;
(3) Employer's discharge of the employee;
(4) Exclusive causal relationship between the Plaintiff's refusal to participate in or remain silent about illegal activities and the employer's termination of the employee.
Voss v. Shelter Mut. Ins. Co. , 958 S.W.2d 342, 344 (Tenn.Ct.App. 1997). In a statutory cause of action, the plaintiff must show that the employer's violation was the "sole" reason for the discharge. Id. at 537.
2.
Employees Sykes and Greene's status as employees is not disputed in this case. Nor is it disputed that they were discharged. The trial court held, however, that "[t]here is no evidence in this case that either [Employee Sykes or Employee Greene] was asked or required to participate in or remain silent about any illegal activity."
In their complaint, Employees state that "[d]uring their employment, [they] witnessed several unconstitutional and unlawful searches of residences, incidents of excessive force, violations of HUD regulations and other unconstitutional and illegal activities. . . ." They also allege that they raised their concerns about the illegal actions "with the human resources manager and the assistant director." In addition, they filed grievances including charges that Chief Hazelwood and Officer Vess engaged in racial profiling as well as illegal searches and seizures and excessive use of force. There is evidence in the record supporting these facts.
Without detailing every assertion, it is sufficient to note that Employees Sykes and Greene both asserted that racial profiling was being conducted by Chief Hazelwood. Employee Greene testified at his deposition that Chief Hazelwood "basically said if you're a black male on the housing authority property, then [you] don't belong, period." Employee Greene testified that Hazelwood instructed him to give African-American males who were ages 19 to 35 criminal trespass citations or take them to jail. A letter written by Employee Greene at the request of Andrew Lawrence, Human Resources Manager — the purpose of which was to confirm issues raised during a July 27, 2004, meeting — shows clearly that Employee Greene raised issues concerning racial profiling and illegal searches and seizures.
For example, Employee Greene states that he and Chief Hazelwood saw an apparent drug transaction between two men, one of whom then went into a residence. The officers had no search warrant and the female resident refused to sign a release. Chief Hazelwood nonetheless started searching, rummaging through drawers. Chief Hazelwood then claimed to have found crack cocaine inside a Crown Royal bag and arrested the female resident. He told Employee Greene to say that the crack had been in plain view, but according to Greene, it was not.
CHA's report of the meeting between Employee Greene, Mr. Lawrence and other managers confirms that this and other allegations of illegal activities were made. A memorandum of a meeting between CHA managers and Officer Billy Puckett shows that Officer Puckett shared the Employees' concerns about illegal searches and seizures by Chief Hazelwood and Officer Vess. These concerns were also shared by Officer Dewayne Prater, a Chattanooga Police Department officer who had worked under contract for CHA. Officer Prater filed an affidavit in support of Employees in this case, stating that during his employment with CHA, he witnessed illegal searches by Chief Hazelwood and Officer Vess. He also stated in his affidavit that he was aware that Employees complained of civil rights violations by Chief Hazelwood and Officer Vess. Employees say that they left the premises where Chief Hazelwood and other officers were illegally searching without a warrant. Furthermore, a review of Employee Sykes' grievance shows on its face that in addition to objecting to the improvement plan, he complained of illegal actions, such as racial profiling.
The trial court abused its discretion in holding that paragraph 7 of Officer Prater's affidavit was irrelevant. To the contrary it shows that third parties were aware that Employees were opposing discriminatory practices and is directly relevant on their cause of action under Tenn. Code Ann. § 4-21-301 (1) (2005).
The Fourth Amendment of United States Constitution applies to all seizures of person, including brief stops, as well as the targeting of an individual solely by reference to race. United States v. Brignoni-Ponce , 422 U.S. 873 (1975). The Equal Protection Clause also prohibits selective enforcement of the law based on impermissible criteria, such as race. Whren v. United States , 517 U.S. 806, 813 (1996). The same is true under the Tennessee Constitution. See State v. Vineyard , 958 S.W.2d 730, 734 n. 6 (Tenn. 1997).
The trial court incorrectly concluded that the law required that a plaintiff show an instruction from his or her employer to participate in illegal activities. There is no such requirement in the law. Mason v. Seaton , 942 S.W.2d 470, 475-76 (Tenn. 1997). Furthermore, Employees Sykes and Greene do not have the burden of proving that the actions they complained of were actually illegal. Rather, it is sufficient if they had reasonable cause to believe that illegal conduct had occurred or would occur and reported it in good faith. See id. at 472 ("The statute's protection extends to employees who have reasonable cause to believe a law, regulation, or rule has been violated or will be violated, and in good faith report it.")
The Defendants apparently understand this concept because they argue that there was no reasonable basis for Employee Sykes' belief that being asked to issue a criminal trespass citation or arrest and jail every male between the ages of 19 and 35 that came into the housing developments was profiling. Defendants point out that the chart Sykes was instructed to use referred only to gender and not to race. This argument is not conclusive on the issue whether Employee Sykes believed in good faith that the practice was indeed racial profiling, however.
Both Employee Sykes and Employee Greene say they were instructed by Chief Hazelwood to stop African-American males. According to Employee Sykes, the CHA had a criminal trespass list with over 1,000 people listed on it and a majority of the names were of African-American men between the ages of 19 and 35. (The majority of persons living in the housing developments were African-American.) At a minimum, there is a factual dispute whether Employees had a reasonable basis to believe that the policy, as applied, was racial profiling. This dispute concerning whether Employees acted in good faith precludes summary judgment. Hannan , 270 S.W.3d at 8-9.
3.
Defendants argue that it was insufficient for Employees to merely report their concerns within CHA. In support of this argument, they cite Merryman v. Central Parking Sys ., No. 01A01-9203-CH-00076, 1992 WL 330404, (Tenn.Ct.App. W.S., filed November 13, 1992). In Merryman , this Court held that reporting the behavior to the offending supervisor himself instead of reporting it to management did not qualify the plaintiff as a whistleblower. Merryman , 1992 WL 330404, at *7. But reporting to "either company management or law enforcement officials" does qualify as whistleblowing. Emerson v. Oak Ridge Research, Inc. , 187 S.W.3d 364, 371(Tenn.Ct.App. 2005).
In this case Employees complained to their supervisors as well as members of CHA management and board members. Employee Sykes went to the District Attorney, HUD and the Tennessee Bureau of Investigation, and both Employees Sykes and Greene complained of illegal activities at CHA when they filed charges of discrimination with the THRC. Here there is no question that Employees met the applicable legal standard since they reported the allegedly illegal activities both within CHA and outside the agency.
4.
Defendants argue that the Employees have not shown a causal link between their complaints of illegal activities and the adverse actions taken against them. To satisfy the element of causation in their prima facie case for retaliatory discharge under Tenn. Code Ann. § 50-1-304, Employees must demonstrate an exclusive causal relationship between their reporting of illegal activities to management and their termination. See Collins , 241 S.W.3d at 884 ("Therefore, the primary difference between the common law and statutory claims is that, to benefit from statutory protection, an employee must demonstrate that his or her refusal [to participate in illegal conduct] was the sole reason for his or her discharge") (emphasis in original).
It is well established that in employment law cases, there will rarely be direct evidence of retaliation. In a retaliatory discharge case, the Supreme Court, in 2002, said that "the essential factor to be determined is the employer's motivation. . . . [D]irect evidence of that motivation is rarely within the plaintiff's possession." Mason , 942 S.W.2d at 474. Consequently, the reviewing court must make a determination whether the "proffered admissible evidence shows circumstances that would be sufficient to permit a rational trier of fact to infer a [retaliatory] motive. It is not the province of the summary judgment court itself to decide what inferences should be drawn." Guy v. Mutual of Omaha Ins. Co. , 79 S.W.3d 528, 534 (Tenn. 2002) (quoting Mason , 942 S.W.2d at 474) (emphasis added).
In this case the trial court apparently assumed that the evidence of causation must be direct evidence. The trial court said, for example, with reference to Employee Greene, "Greene has not produced any evidence that anyone at CHA who participated in the decision to terminate him was doing so as a result of any refusal to participate in or remain silent about CHA's activities." While the Employees offered no direct evidence of retaliation, they presented several examples of circumstantial evidence of causation (retaliatory motive) in their terminations.
One circumstantial piece of evidence of causation is the timing of discipline and termination. Employee Sykes filed his grievance on June 24, 2004. He alleges that after he gave copies of the grievance to Chief Hazelwood, he began immediately to be treated differently from similarly situated officers who had not made whistleblowing claims. His grievance hearing was on July 27 and less than a month later he was suspended. And a month after that he was terminated. On October 4, 2004, less than a week after CHA terminated Employee Sykes' employment, it suspended Employee Greene. As Defendants note in their brief, Employee Greene had been in violation of a cell phone policy since the beginning of his employment. But he was not suspended for the violation until just after the Defendants fired Employee Sykes. The timing of the suspension thus raises an issue as to the motive for it. Employee Greene took a month of intervening FMLA leave, but his employment was terminated on January 19, 2005 — a period of just over three months from the suspension to the termination.
In Allen v. McPhee , a case involving sex discrimination, the Supreme Court recently adopted the rule that "close temporal proximity of a complaint and a materially adverse action are sufficient to establish a prima facie case of causation." Allen v. McPhee , 240 S.W.3d 803, 823 (Tenn. 2007) (discussing causation in context of THRA retaliation claim). In Allen , the Court said:
In this case, the TBR [Tennessee Board of Regents] first attempted to reassign Allen two weeks after the filing of her complaint. When Allen declined to accept the reassignment, she was allowed to remain on paid leave while the TBR concluded its investigation. Allen was then officially reassigned when the TBR accepted the findings and recommendations of the investigation less than two months after Allen filed her complaint. These facts indicate a close temporal proximity of the complaint and the reassignment and therefore allow an inference that the TBR was motivated by an intent to retaliate.
Id. The time elements with respect to Employee Sykes in the case at bar are comparable. And as soon as Employee Sykes was gone, Employee Greene was terminated in a similarly short time frame.
Furthermore, Tennessee courts have recognized that circumstantial evidence that can satisfy the causation element of a prima facie case of retaliatory discharge includes "the employer's failure to adhere to established company policy." Newcomb v. Kohler Co. , 222 S.W.3d 368, 391 (Tenn.Ct.App. 2006). In this case, there is evidence that CHA did not follow its own personnel policies when it failed to investigate Employees' grievances.
The Supreme Court has held that "[t]he evidence of a good work history presented by the plaintiff" can "establish a causal relationship between [the] reporting of the suspected illegal activity at [the] place of employment and [the] discharge." Mason , 942 S.W.2d at 474. Employees in this case had good performance records, and Employee Sykes had received a good performance review in November 2003 as well as raises in January and May 2004. Chief Hazelwood testified that Employee Greene had never received discipline prior to his grievance. As in Mason , these facts allow a trier of fact to draw the reasonable inference that there was a causal relationship between the reporting of illegal activities and the terminations.
As previously noted, the Defendants argue that it is undisputed that Chief Hazelwood had nothing to do with the terminations. However, Officer Vess testified that he and Chief Hazelwood recommended Sykes' termination. Officer Vess and Chief Hazelwood were the two officers that Employees claimed were engaging in illegal activities. Moreover, after Employee Greene was suspended and placed at a desk job, Officer Vess told him that his police duties would be returned to him when "he became a team player and did what officers needed to do." The statement links the discipline to a retaliatory motive.
In addition, the circumstances of the suspension strongly suggest that the adverse action was a result of retaliation. Employee Greene was removed from patrol. His car and cell phone were taken and he was assigned to work the desk job, not during normal office hours, but from 5:00 p.m. to 3:00 a.m., Wednesday through Saturday. The latter part of the discipline was so suspiciously retaliatory in nature that when Employee Greene called attention to it, CHA supervisors, above Chief Hazelwood and Officer Vess in the chain of command, immediately changed the desk duty hours to conform to normal office hours.
Similarly, the circumstances of the suspension of Employee Sykes raise a question whether the action was a result of retaliation. Rather than simply meet with Employee Sykes in the normal course of business, Officer Vess called Sykes on his cell phone and told him not to attend a meeting with OIG inspectors. Then, when Officer Vess delivered the suspension to Sykes, he brought with him Mr. Lawrence, the Human Resources Manager, several CHA officers and Chattanooga Police Department officers. A jury could reasonably find that the makeup of the group delivering the message was for the purpose of harassing, intimidating and embarrassing Employee Sykes. This conclusion is reinforced by the fact that the written notice of suspension gave no reason for it and Officer Vess gave no reason when asked. One could conclude from all of this that Sykes' disciplinary action was not handled in a routine way.
In a summary judgment motion, the burden is on the moving party to either negate that Employees have shown the element of causation in their retaliatory discharge claims or else show that they cannot prove causation at trial. Hannan , 270 S.W.3d at 9. The Defendants in this case have failed to meet their burden with respect to causation on either prong.
5.
The trial court held that Employee Sykes and Employee Greene failed to produce any evidence that complaints made about the CHA safety department were the sole cause of their terminations. In its judgment, the trial court noted that "most of Sykes' complaints centered on how CHA's safety department was organized and operated. Those complaints do not qualify as `whistleblowing' under this statute." While the trial court's conclusion is a correct statement of the law, it is clear that both Employees complained of racial profiling and illegal arrests, searches and seizures that they observed. These matters do qualify as whistleblowing under the statute.
We hold that there is a genuine issue of material fact as to the issue of "sole cause" with respect to Employee Sykes' retaliatory discharge claim under Tenn. Code Ann. § 50-1-304. Furthermore, the Defendants failed to show that Employee Sykes cannot prove at trial that retaliation was the sole reason for his termination.
The case of Employee Greene is different. The facts show that he was suspended over the cell phone policy. After the suspension, he took FMLA leave for approximately a month. During that time, despite his suspension and despite the warnings that he needed to pay his overages and cease using the CHA-issued cell phone for personal calls, he made more than a thousand personal calls. Whether the calls were made at night or on weekends and free as Employee Greene asserts is not the point. We affirm the trial court's holding that "Employee Greene violated the cell phone policy after having been warned not to do so and suspended for that very reason." We thus hold that Employee Greene may not proceed under the statutory cause of action requiring that retaliation be the "sole cause" of the discharge. The facts before us clearly show a legitimate basis for his termination and, hence, that any retaliation could not be the "sole cause."
B.
Employees in this case also assert that they were terminated for filing claims under the Tenneseee Human Rights Act, Tenn. Code Ann. § 4-21-101, et seq. ("the Act"). Employees Sykes and Greene both filed charges of discrimination, claiming a racially hostile work environment. The Act also prohibits a person or entity from retaliating or discriminating "in any manner against a person because such person has opposed a practice declared discriminatory by this chapter. . . ." Tenn. Code Ann. § 4-21-301 (1) (2005). Employees claim that they opposed discriminatory practices against African-American residents of CHA housing developments. To state a claim for retaliation, a plaintiff must establish that:
the plaintiff engaged in a protected activity; . . . the exercise of the plaintiff's protected civil rights was known to the defendant; . . . the defendant thereafter took an employment action adverse to the plaintiff; and . . .that there was a causal connection between the protected activity and the adverse employment action.
Newsom v. Textron Aerostructures , 924 S.W.2d 87, 96 (Tenn.Ct.App. 1995). Among activities that courts have considered as opposing discriminatory practices are "publicly and privately expressing that an employer has illegally discriminated," such as reporting illegal discrimination to supervisors. See Wilson v. Wayne County , 856 F. Supp. 1254, 1260 (M.D. Tenn. 1994).
In their briefs to this court, Employees address only their claims for being retaliated against for opposing practices of discrimination. The Defendants suggest that Employees' filing of a lawsuit based on their charges of discrimination — at a time before the THRC completed its investigation — was somehow improper. Contrary to the Defendants' point, however, it has been held that a plaintiff may proceed directly in state court by filing a complaint within one year of the discriminatory act or acts. Hoge v. Roy H. Park Broad. of Tenn., Inc. , 673 S.W.2d 157, 160 (Tenn. Ct App., E.S., 1984). There is no requirement in Tennessee that a discrimination complaint be filed with THRC or that once a charge is filed with THRC the plaintiff must wait for the agency to conclude its investigation in order to proceed to court. Puckett v. Tennessee Eastman Co. , 889 F.2d 1481, 1485 (6th Cir., 1989) ("the nature of the chancery court action as a discrete and additional remedy compelled a conclusion that the legislature did not intend the commencement of administrative proceedings to operate as an election and foreclose a judicial remedy").
The Defendants have asserted legitimate, non-discriminatory business reasons for terminating Employees. Those reasons, however, are hotly disputed and clearly involve genuine issues of material fact. Nonetheless, as Tennessee law has been applied, the assertions require Employees to show that the reasons advanced by CHA are pretextual. See, e.g., Hill v. Perrigo of Tennessee , No. M2000-02452-COA-R3-CV, 2001 WL 694479, at *6 (Tenn.Ct.App. M.S. filed June 21, 2001) (citations omitted).
The following circumstantial evidence (which has been discussed earlier) meets that burden: the proximity in time of complaints and adverse actions; the alleged failure to follow internal personnel policies as to investigations of grievances; the involvement of Officer Vess (whom Employees allege engaged in illegal activities and discrimination) in suspensions and terminations of Employees; the involvement of Chief Hazelwood (whom Employee Sykes also alleges engaged in illegal activities and discrimination) in the suspension of Employee Sykes and in recommending his termination; the prior favorable evaluations of Employees and lack of discipline of them prior to the complaints; the clearly retaliatory nature of the terms of Employee Greene's return to work after suspension; the similarly retaliatory nature of Officer Vess's serving a notice of suspension on Employee Sykes, accompanied by officers of the CHA police, the Chattanooga Police Department and CHA's manager of human resources; and the ongoing use of racist language in the work environment, which involved dealing primarily with minority members.
We hold that the Defendants failed to negate that the Employees' terminations were retaliation for having opposed discriminatory practices, including illegal arrests based on racial profiling, warrantless searches and illegal seizures of the mostly African-American residents of CHA's housing developments. We also hold that Defendants failed to negate that Employees were retaliated against for refusing to participate in these practices. Thus, we vacate the judgment of the trial court granting summary judgment on Employees' claims under Tenn. Code Ann. § 4-21-101 et seq.
C.
Tennessee recognizes statutory and common law actions for unlawful inducement of breach of contract. Givens v. Mullikin , 75 S.W.3d 383, 405 (Tenn. 2002). Intentional interference with an at-will employment contract, without privilege or justification, is actionable. Forrester v. Stockstill , 869 S.W.2d 328, 330 (Tenn. 1994); Baldwin v. Pirelli Armstrong Tire Corp. , 3 S.W.3d 1, 6 (Tenn.Ct.App. 1999).
In Lyne v. Price , W2000-00870-COA-R3-CV, 2002 WL 1417177 (Tenn.Ct.App. W.S., filed June 27, 2002), an at-will secretary for a university's athletic department sued her supervisor in his individual capacity for intentional interference with her employment after she was discharged by the university. Id. at *1. The trial court granted the supervisor's motion to dismiss. The motion was based upon Tenn. R. Civ. P. 12.02(1) and (6). Id. at *2. On appeal, we reversed, holding that the plaintiff's amended complaint was "sufficient to state a claim against [her supervisor] in his individual capacity." Id. at *4. In the course of our opinion, we noted the applicable principles:
A corporation may only act through its agents and employees; consequently, a corporate director, officer or employee is not individually liable for tortious interference with a corporate contract, such as an at-will employment agreement, so long as he is acting in furtherance of the corporate interest. A corporate director, officer or employee may be held liable for interference with such a contract if "he is acting outside the scope of his authority, acting with malice, or acting to serve his own interests." However, where there is intentional interference with an employment contract, there is frequently "some element of ill will"; consequently, where the director, officer or employee is generally acting in furtherance of the corporate interest, "the addition of a spite motive usually is not regarded as sufficient to result in liability." He may be held liable if "the reason underlying his interference is purely a malevolent one, and a desire to do harm to the plaintiff for its own sake." . . . [T]he public interest is served by corporations having candid advice from their officers and employees, and . . . fear of individual liability would limit such advice. Consequently, the actions of an officer, director or employee of a corporation are considered to be the actions of the corporation so long as he is acting "within the general range of this authority, and his actions are substantially motivated by an intent to further the interest of the corporation." Under these circumstances, the director, officer or employee is immune from individual liability.
Id. at *3 (citations omitted).
On the record before us, the evidence creates a genuine issue of material fact as to whether "the reason underlying [Chief Hazelwood's] interference is purely a malevolent one, and a desire to do harm to the plaintiff for its own sake." Id. This genuine issue precludes a grant of summary judgment to Chief Hazelwood on this particular claim of Employees. Accordingly, we vacate the trial court's grant of summary judgment as to Employees' claim of unlawful inducement of breach of contract.
D.
Employee Sykes also appeals the granting of summary judgment of his cause of action for defamation against Chief Hazelwood. A plaintiff establishes a claim for defamation by showing the following: "a party published a statement; . . . with knowledge that the statement is false and defaming to the other; or . . . with reckless disregard for the truth of the statement or with negligence in failing to ascertain the truth of the statement." Sullivan v. Baptist Mem. Hosp. , 995 S.W.2d 569, 572 (Tenn. 1999).
Employee Greene does not appeal the dismissal of his cause of action for defamation.
Employee Sykes says that Chief Hazelwood discussed the alleged reasons for his termination with other officers of CHA as well as Chattanooga Police Department officers and that the reasons were not true. At his deposition, Employee Sykes listed the names of officers with whom he claims Chief Hazelwood discussed his termination, but he has not produced affidavits of these witnesses and his testimony is without detail as to what was said or when. Employees thus have not complied with the mandate of Rule 56.06 that "an adverse party may not rest upon the mere allegations or denials . . . but his or her response, by affidavits or as otherwise provided in this rule, must set forth specific facts showing that there is a genuine issue for trial. If the adverse party does not so respond, summary judgment, if appropriate, shall be entered against the adverse party." Tenn. R. Civ. P. 56.06.
As to one conversation with Sergeant McPhearson, Employee Sykes says that the conversation occurred "right before this suspension." The Defendants correctly point out that the timing of the alleged conversation shows that it occurred more than six months before the lawsuit was filed and thus any slander by Chief Hazelwood would have occurred more than six month before the lawsuit was filed. Thus, the alleged statements to Sergeant McPhearson would be barred by the applicable statute of limitations. Tenn. Code Ann. § 28-3-103 (2000); Quality Auto Parts Co. v. Bluff City Buick Co. , 876 S.W.2d 818, 821 (Tenn. 1994).
Employee Sykes also alleges that Chief Hazelwood discussed alleged reasons for his termination with residents of CHA housing projects. But, again, at his deposition, Employee Sykes could not provide the names of any resident with whom Chief Hazelwood allegedly spoke. Thus, Employees have not carried the burden under Rule 56.06 to show that there are genuine issues of material fact for trial as to alleged defamatory discussions with residents of CHA housing developments.
Employee Sykes also says that Chief Hazelwood's report to the POST Commission was defamatory. Defendants claim that Chief Hazelwood was immune from this claim pursuant to Tenn. Code Ann. § 4-21-1003 (2005), which provides protection for the free flow of information from citizens to governmental agencies. Defendants also argue that Chief Hazelwood "had a duty" to make the report. Based on the record, it is unclear whether Chief Hazelwood had a duty to report. But we need not decide whether a duty existed or the issue of immunity. Nor need we determine the issue raised in Employees' brief concerning the applicability of privileges under defamation law.
Employee Sykes' allegations concerning the report to the POST Commission, like the other claims of defamation, are not specific. For example, although Employee Sykes claims that Chief Hazelwood's letter to the Post Commission defamed him, the record does not show what portions of the letter sent by Chief Hazelwood to the Commission are allegedly defamatory.
Once the Defendants filed a properly supported summary judgment motion, it was incumbent upon Employee Sykes to produce specific evidence that makes clear that there are genuine issues of material fact as to the issue of defamation. Tenn. R. Civ. P. 56.06. This Sykes failed to do. The trial court's granting of summary judgment on the claim of defamation is thus affirmed.
V.
In summary, we (1) vacate the trial court's grant of summary judgment as to the plaintiff Sykes' claim under Tenn. Code Ann. § 50-1-304; (2) affirm the trial court's grant of summary judgment as to the plaintiff Greene's claim under that statute; (3) vacate the grant of summary judgment as to both plaintiffs' claims under Tenn. Code Ann. § 4-21-301; (4) vacate the court's grant of summary judgment as to the plaintiff Sykes' claim against Chief Hazelwood for inducement of breach of contract; and (5) affirm the grant of summary judgment on the plaintiff Sykes' claim of defamation.
VI.
The judgment of the trial court is vacated in part and affirmed in part. Exercising our discretion, we tax the costs on appeal against the Chattanooga Housing Authority. This case is remanded to the trial court for further proceedings, consistent with this opinion.