Stephen Wesbrook v. Karl Ulrich
2016 U.S. App. LEXIS 18872
| 7th Cir. | 2016Background
- Stephen Wesbrook was deputy director of the Marshfield Clinic Research Foundation and was terminated effective January 2, 2012 after internal complaints about his management style and a performance-improvement process.
- Defendants: Dr. Karl Ulrich (Clinic CEO) and Dr. Edward Belongia (senior research scientist). Ulrich drafted a nine-page "Chronology" and submitted it, Belongia’s November letter, and a letter from Melvin Laird to the Clinic board before the termination vote.
- Key statements at issue: Belongia’s letter that Wesbrook used "coercion and intimidation" and that employees had "filed complaints" with HR; Ulrich’s description of the performance-improvement process; Laird’s statement that he spoke with over forty Clinic/RF affiliates who criticized Wesbrook.
- District court granted summary judgment for defendants, finding the challenged statements were true or substantially true and therefore privileged; motive immaterial.
- On appeal under Wisconsin law, the Seventh Circuit affirmed, holding substantially true statements communicated within the enterprise are privileged and cannot support tortious-interference claims by an at-will employee.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether defendants’ statements were privileged (truth/substantial truth) | Wesbrook: statements were false or materially misleading (e.g., "coercion" vs. "intimidation", "filed" complaints) | Defendants: statements were true or substantially true based on HR investigations, resignations, and witness reports | Held: Statements were true or substantially true and therefore privileged; no tortious interference as a matter of law |
| Whether defendant motive (ill will) negates privilege | Wesbrook: Ulrich/Belongia acted from improper motives; motive should matter | Defendants: motive irrelevant where statements are true/substantially true | Held: Motive irrelevant when statements are (substantially) true; privilege stands |
| Whether Ulrich misrepresented compliance with a performance-improvement plan | Wesbrook: Ulrich alleged Wesbrook failed to comply with the plan | Defendants: Ulrich did not assert failure to comply; termination followed Wesbrook’s inadequate response and the board never approved a joint plan | Held: Ulrich’s Chronology did not state noncompliance; account truthful and causation lacking for any asserted noncompliance |
| Precedent Preston’s applicability and correctness | Wesbrook: Preston’s two-prong test should not limit tort claims against supervisors/co-workers | Defendants: Preston correctly prevents tort detour around at-will employment doctrine | Held: Court follows and defends Preston; allowing widespread tort claims would undermine at-will employment policy |
Key Cases Cited
- Mackenzie v. Miller Brewing Co., 608 N.W.2d 331 (Wis. Ct. App. 2000) (truthful information transmission is privileged and cannot support tortious interference)
- Preston v. Wisconsin Health Fund, 397 F.3d 539 (7th Cir. 2005) (employee tortious-interference claims require that the defendant not benefit and that the act be independently tortious)
- Briesemeister v. Lehner, 720 N.W.2d 531 (Wis. Ct. App. 2006) (elements of tortious interference and factors for privilege inquiry)
- Terry v. Journal Broadcast Corp., 840 N.W.2d 255 (Wis. Ct. App. 2013) (substantial truth suffices in defamation context)
- Liebe v. City Finance Co., 295 N.W.2d 16 (Wis. Ct. App. 1980) (truthful information is privileged)
- Heinritz v. Lawrence University, 535 N.W.2d 81 (Wis. Ct. App. 1995) (strong presumption that employment is at-will)