894 F.3d 1277
8th Cir.2018Background
- Jonathan Scarborough was fired by Federated Mutual Insurance Company in 2014 and sued under the Minnesota Whistleblower Act (MWA), claiming his firing was retaliation for reporting employee theft.
- Scarborough presented evidence that he informed supervisors about an employee stealing from Federated and warned of consequences.
- The district court granted Federated’s motion for summary judgment, concluding Scarborough’s disclosures were not MWA-protected reports.
- The district court applied pre-2013 judicial definitions of “report” and “good faith,” which required proof the reporter’s purpose was to expose illegality.
- In 2013 the Minnesota legislature amended the MWA, adding statutory definitions of “report” and “good faith,” eliminating the prior purpose-based inquiry.
- The Minnesota Supreme Court in Friedlander held the 2013 amendment removed the judicially created purpose requirement and directed courts to assess only the content of the report.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Scarborough’s disclosures qualify as an MWA-protected “report” under the post-2013 statute | Scarborough contends his communication about employee theft was a report of a suspected violation and thus protected | Federated argued the disclosures did not meet the judicially created pre-2013 standards for a protected report | Court vacated district judgment and remanded for reconsideration under the post-2013 statutory definitions (per Friedlander) |
| Whether Scarborough acted in “good faith” | Scarborough asserts he acted in good faith by reporting suspected theft (not knowingly false or reckless) | Federated relied on pre-amendment caselaw requiring a whistleblowing purpose to establish good faith | Court indicated the pre-amendment purpose test is abrogated; good faith is now assessed by whether the employee made knowingly false or recklessly false statements; remanded for district court to apply this standard |
| Whether district court properly applied Minnesota law in granting summary judgment | Scarborough argued the district court applied outdated judge-made standards abolished by the 2013 amendment and Friedlander | Federated defended the summary judgment ruling under the then-applied precedents | Court held the district court relied on abrogated standards; vacated and remanded for reconsideration under Friedlander |
| Whether this Court should resolve factual disputes on appeal | Scarborough sought reversal on the merits | Federated asked affirmance | Court declined to decide factual disputes or merits, directing the district court to reassess summary judgment in the first instance |
Key Cases Cited
- Hohn v. BNSF Ry. Co., 707 F.3d 995 (8th Cir. 2013) (standard of review for summary judgment)
- Washington v. Countrywide Home Loans, Inc., 655 F.3d 869 (8th Cir. 2011) (appellate courts bound by state supreme court on state-law questions)
- Obst v. Microtron, Inc., 614 N.W.2d 196 (Minn. 2000) (pre-2013 MWA interpretation requiring whistleblowing purpose)
- Friedlander v. Edwards Lifescis., LLC, 900 N.W.2d 162 (Minn. 2017) (2013 amendment eliminated purpose requirement; courts must consider report content only)