McBride v. Peak Wellness Center, Inc.
688 F.3d 698
| 10th Cir. | 2012Background
- McBride, a CPA, served as Peak Wellness Center’s business manager for about nine years and was terminated in January 2009 for purported performance/morale issues.
- McBride alleged retaliation under the federal False Claims Act (FCA) for reporting accounting improprieties to Peak’s Board.
- She asserted federal and state claims: FCA whistleblower retaliation, FLSA violations, breach of contract, breach of implied covenant of good faith, defamation, and Title VII sex discrimination.
- The district court granted Peak summary judgment on all claims; McBride appeals the grant and an evidentiary ruling denial.
- Peak presented evidence that McBride’s FCA notice to the Board was insufficient to show intent to pursue a qui tam action; McBride’s other statutory and contractual claims proceeded to summary judgment analysis.
- Wyoming law governs contract exhaustion, implied covenant, and at-will employment presumptions; the contract grievance procedure was deemed mandatory, and McBride failed to timely pursue it.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| FCA retaliation viability | McBride contends Peak retaliated for FCA activity. | There was no clear notice of FCA action or intent to pursue a qui tam action. | Summary judgment affirmed for Peak; no prima facie FCA retaliation evidence. |
| FLSA pay deductions for exempt employee | Peak deducted leave time from McBride’s accrued leave, violating exempt compensation rules. | Deductions did not reduce salary and did not violate FLSA for exempt employees. | Summary judgment affirmed; no FLSA violation. |
| Breach of employment contract—exhaustion of grievance procedures | McBride was deprived of a contractual grievance remedy upon termination. | Contractual review procedures were mandatory and must be timely pursued. | Contract claim barred; McBride did not timely seek review. |
| Breach of implied covenant of good faith and fair dealing | McBride asserts a special relationship (trust/reliance) justified a duty not to terminate without cause. | No special relationship existed; fiduciary duties do not create such a covenant in this context. | Claim failed as a matter of law; no qualifying special relationship. |
| Defamation and hostile work environment based on sex | Alleged defamatory emails and hostile environment claim based on sex discrimination. | Most statements were nonactionable rhetorical hyperbole; one timely statement lacked injury and wasn’t peculiarly harmful to an accountant. | Defamation and hostile environment claims failed; insufficient factual injury and lack of discriminatory impact. |
Key Cases Cited
- United States ex rel. Ramseyer v. Century Healthcare Corp., 90 F.3d 1514 (10th Cir. 1996) (Notice required that plaintiff show intent to pursue FCA action)
- Spradling v. City of Tulsa, 95 F.3d 1492 (10th Cir. 1996) (Deductions from leave policy context; policy cannot reduce salary)
- Abshire v. County of Kern, 908 F.2d 483 (9th Cir. 1990) (Policy of deductions for sick leave vs. salary; right distinction)
- Metz v. Laramie Cnty. Sch. Dist. No. 1, 173 P.3d 334 (Wyoming 2007) (Grievance-right interpretation; procedure permissive vs mandatory)
- Bryant v. Pac. Power & Light, 701 P.2d 1165 (Wyoming 1985) (Requirement to file grievance is mandatory; exhaustion governs)
- Jackson State Bank v. Homar, 837 P.2d 1081 (Wyoming 1992) (Waiver elements for contractual rights)
- Hoflund v. Airport Golf Club, 105 P.3d 1079 (Wyoming 2005) (Longevity of service does not alone create special relationship)
- Trabing v. Kinko's, Inc., 57 P.3d 1248 (Wyoming 2002) (Longevity of service not sufficient for implied covenant)
- Dworkin v. L.F.P., Inc., 839 P.2d 903 (Wyoming 1992) (Defamation: abusive epithets generally nonactionable)
- Oncale v. Sundowner Offshore Servs., Inc., 523 U.S. 75 (Supreme Court 1998) (Hostile work environment standards in sexual discrimination)