Opinion
C/A 3:22-cv-2752-JFA-KDW
03-20-2023
Antonio Daniels, Plaintiff, v. Harsco Corporation, Defendant.
REPORT AND RECOMMENDATION
Kaymani D. West United States Magistrate Judge.
This employment-related matter is before the court for issuance of a Report and Recommendation (“R&R”)as to Defendant's Partial Motion to Dismiss. ECF No. 15. Plaintiff originally filed his Complaint in the Lexington County Court of Common Pleas; Defendant removed the matter to this court on August 18, 2022. ECF No. 1. In response to an earlier Partial Motion to Dismiss, ECF No. 4, Plaintiff filed an Amended Complaint, ECF No. 10. The Amended Complaint includes the following causes of action: (1) a claim of whistleblower retaliation brought pursuant to the Federal Railroad Safety Act (“FRSA”); (2) defamation; (3) race discrimination in violation of 42 U.S.C. § 1981; (4) retaliation in violation of 42 U.S.C § 1981; and (5) wrongful discharge, breach of employee handbook. Am. Compl., ECF No. 10.
This matter is referred to the undersigned pursuant to 28 U.S.C. § 636(b) and Local Civil Rule 73.02(B)(2) (D.S.C.).
In the Partial Motion to Dismiss, Defendant Harsco Corporation (“Defendant” or “Harsco”) seeks Rule 12(b)(6) dismissal of Plaintiff's FRSA-based whistleblower retaliation claims and the state-law-based claims of defamation and wrongful discharge/breach of employee handbook.Mem. Support Def. Mot. Dism. (“Def. Mem.”), ECF No. 15-1. Plaintiff opposes the Motion to Dismiss, ECF No. 16, and Defendants filed a Reply, ECF No. 18. After considering the parties' filings and applicable law, the undersigned recommends Defendant's Partial Motion to Dismiss, ECF No. 15, be granted in part and denied in part as discussed herein.
Defendant does not seek Rule 12 dismissal of the claims of race discrimination or retaliation brought pursuant to 42 U.S.C. § 1981 (causes of action three and four).
I. Legal standard
“A motion filed under Rule 12(b)(6) challenges the legal sufficiency of a complaint.” Francis v. Giacomelli, 588 F.3d 186, 192 (4th Cir. 2009). The court measures the legal sufficiency by determining whether the complaint meets the Rule 8 standards for a pleading. Id. The Supreme Court considered the issue of well-pleaded allegations, explaining the interplay between Rule 8(a) and Rule 12(b)(6) in Bell Atlantic Corp. v. Twombly:
Federal Rule of Civil Procedure 8(a)(2) requires only “a short and plain statement of the claim showing that the pleader is entitled to relief,” in order to “give the defendant fair notice of what the . . . claim is and the grounds upon which it rests.” While a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations, a plaintiff's obligation to provide the “grounds” of his “entitle[ment] to relief” requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do. Factual allegations must be enough to raise a right to relief above the speculative level . . .550 U.S. 544, 555 (2007) (internal citations omitted); see also Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (“A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” (citing Twombly, 550 U.S. at 556)). When considering a motion to dismiss, the court must accept as true all of the factual allegations contained in the complaint.” Erickson v. Pardus, 551 U.S. 89, 94 (2007). The court is also to “‘draw all reasonable inferences in favor of the plaintiff.'” E.I. du Pont de Nemours & Co. v. Kolon Indus., Inc., 637 F.3d 435, 440 (4th Cir. 2011) (quoting Nemet Chevrolet, Ltd. v. Consumeraffairs.com, Inc., 591 F.3d 250, 253 (4th Cir. 2009)). Although a court must accept all facts alleged in the complaint as true, this is inapplicable to legal conclusions, and “[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.” Iqbal, 556 U.S. at 678 (citation omitted). While legal conclusions can provide the framework of a complaint, factual allegations must support the complaint for it to survive a motion to dismiss. Id. at 679. Therefore, a pleading that provides only “labels and conclusions” or “naked assertion[s]” lacking “some further factual enhancement” will not satisfy the requisite pleading standard. Twombly, 550 U.S. at 555, 557. Further, the court “need not accept as true unwarranted inferences, unreasonable conclusions, or arguments.” E. Shore Mkts., Inc. v. J.D. Assocs., Ltd. P'ship, 213 F.3d 175, 180 (4th Cir. 2000). In addition, statements by counsel that raise new facts constitute matters beyond the pleadings and cannot be considered on a Rule 12(b)(6) motion. Kolon Indus., Inc., 637 F.3d at 449. Additional statements by counsel that may not be considered include not only those of the pleader's counsel but also statements of defense counsel who is seeking dismissal. Id. (citing Dolgaleva v. Va. Beach City Pub. Sch., 364 Fed.Appx. 820, 825 (4th Cir. 2010), in which district court erroneously dismissed complaint based on defendant's statements in hearing that disputed complaint's allegations). At bottom, the court is mindful that a complaint “need only give the defendant fair notice of what the claim is and the grounds upon which it rests.” Coleman v. Md. Ct. of Apps., 626 F.3d 187, 190 (4th Cir. 2010) (internal quotation marks omitted).
II. Background
The following facts are taken from Plaintiff's Amended Complaint and construed in the light most favorable to him:
In October 2007 Plaintiff began working as a “mechanical assembler working on railway equipment” at Defendant's Lexington, South Carolina facility (“Facility”). Plaintiff became a team leader around May 2019. As of March 2020 Byron Tobin was transferred in as a supervisor at the Facility; Tobin's responsibilities included supervising Plaintiff's team and directly supervising Plaintiff. Also in March 2020 Kevin Greer became the Facility's Production Manager; in this position, Greer was responsible for overseeing the supervisors, including Tobin. Am. Compl. ¶¶ 7-13.
In May 2020, Plaintiff “reported to Tobin that a railway machine was being taken outside to run prior to having windows installed because it posed a direct and unnecessary danger to the employees working on the machinery.” Am. Compl. ¶ 14. Tobin disregarded Plaintiff's report and pushed the work on the machine to proceed. Plaintiff then reported the safety concern to Greer, who indicated he would check on the situation and get back with Plaintiff. Id. ¶¶ 15, 16. Plaintiff's coworker and teammate, Todd Carter (“Carter”) reported the safety concerns of running the railway machine before the windows were installed to James Butner (“Butner”)who was one of the employees who supervised safety of operations at the Facility. Id. ¶ 17. Tobin learned that Plaintiff and Carter made the safety reports, and he “took Plaintiff and Carter off the factory floor and into an office and attempted to intimidate them for having reported their safety concerns to the safety supervisor[.]” Id. ¶ 18. Tobin accused Plaintiff of going against him when reporting the safety conditions and indicated Plaintiff had gone against his authority on other occasions. Tobin demoted Plaintiff from his team-leader position. Id. ¶ 21.
Defendant indicates this individual's name is James Buckner.
On May 21, 2020, Plaintiff met with Greer and Shannon Gardner (“Gardner”) who is a representative of Harsco's Human Resources (“HR”) Department. During this meeting, Plaintiff reported that Tobin had been harassing him on the job and retaliating against him since his reporting of the safety concerns in March 2020. Plaintiff requested a transfer from the team under Tobin. Greer and Gardner advised Plaintiff they would investigate his complaints and follow up with him, but this never happened. Am. Compl. ¶¶ 22-23.
In June 2020, Plaintiff alleges that Tobin suspended him for leaving early and missing mandatory overtime, despite previously announcing that mandatory overtime would change to voluntary and not informing Plaintiff of the assigned work hours. Am. Compl. ¶¶ 24-27. Plaintiff again complained to HR that Tobin was harassing him for reporting the prior alleged safety hazard. Id. ¶ 28. After following up with HR, Plaintiff was told to return to work on June 22, 2022. Id. ¶ 29. On June 22, 2022, Plaintiff arrived at Harsco's facility 30 minutes prior to his normal work start time; however, no one appeared to let him into the Facility. Id. ¶ 30. Plaintiff alleges that he reported to HR that he could not access the Facility, then returned home and requested emergency vacation for the missed work time. Id. ¶ 30. Tobin contacted Plaintiff later on June 22, 2020 to inform him that Plaintiff's employment was terminated effective immediately. Id. ¶ 31.
III. Analysis
A. FRSA whistleblower retaliation claim
Defendant first seeks dismissal as a matter of law as to Plaintiff's FRSA whistleblower claim, brought under 49 U.S.C. § 20109: the FRSA's “Whistleblower Protection Provision.” Investigator's Desk Aid to the [FRSA] Whistleblower Protection Provision, 29 U.S.C. § 20109, ECF No. 18-1. As summarized in the Desk Aid, the “FRSA promotes safety in railroad operations and reduces railroad-related accidents by protecting employees from retaliation for engaging in protected activities including reporting alleged violations of federal law relating to railroad safety or security and reporting work-related injuries or hazardous safety or security conditions.” Desk Aid 2. Protected activity for FRSA purposes may fall under subsection (a)'s “general protections,” subsection (b)'s “hazardous safety or security conditions” subsection, or subsection (c)'s “prompt medical attention” subsection. Id. at 6-10; id. at 6 (noting there is some overlap in the three sections). Only subsections (a) and (b) potentially are relevant to this case. Subsection (a) applies to employees of “railroad carriers,” as well as contractors or subcontractors of such railroad carriers; subsection (b) applies to employees of railroad carriers but not to employees of their contractors or subcontractors. 49 U.S.C. § 20109(a), (b). Defendant argues Plaintiff has not and cannot plead a plausible claim under either § 20109(a) or (b). Defendant acknowledges it is a contractor of a railroad carrier, making subsection (a) applicable; however, it argues Plaintiff's reporting was not protected under subsection (a) because Plaintiff did not assist in an investigation of an alleged safety violation. Defendant argues subsection (b) is inapplicable because it is not a railroad carrier. Reply 2.
In seeking dismissal as a matter of law, Defendant has provided an FRSA “Desk Aid” compiled by the Occupational Health and Safety Administration (“OSHA”) to provide OSHA's “summary of the scope of coverage and protected activity” for purposes of FRSA retaliation complaints. Investigator's Desk Aid to the [FRSA] Whistleblower Protection Provision, 29 U.S.C. § 20109, ECF No. 18-1, available at https://www.whistleblowers.gov/sites/default/files/FRSA-Desk-Aid-FINAL-12-20-2019.pdf (last visited Feb. 1, 2023). The “Desk Aid” does not take the place of the statute or regulations. The court references it herein because it is looked to by Defendant and it offers a helpful summary of 49 U.S.C. § 20109's protections.
The court first considers whether Plaintiff has pleaded a retaliation claim based on 29 U.S.C. § 20109(a). Defendant characterizes subsection (a) as “protecting employees of both ‘railroad carriers' and contractors to railroad carriers from retaliation for assisting in investigations of alleged safety violations.” Def. Reply 2 (emphasis added). Looking to Plaintiff's Amended Complaint, Defendant submits Plaintiff only “reported an allegedly hazardous safety condition, not that he participated in an investigation of an alleged safety hazard[,]” placing his activity under subsection (b) only. Reply 2. The court agrees that Plaintiff's allegations concern reporting of safety concerns to his superiors and do not indicate he ever participated in any actual investigation. However, subsection (a) does not necessarily require participation in an active safety-related investigation. Rather, focus on the language bolded below indicates that “provid[ing] information” the employee reasonably believes to violate a law rule, or regulation “relating to railroad safety or security,” may constitute protected activity so long as the information is provided to “a person with supervisory authority over the employee or such other person who has the authority to investigate, discover, or terminate the misconduct[.]” 29 U.S.C. § 20109(a) (emphasis added).
(a) In general.--A railroad carrier engaged in interstate or foreign commerce, a contractor or a subcontractor of such a railroad carrier, or an officer or employee of such a railroad carrier, may not discharge, demote, suspend, reprimand, or in any other way discriminate against an employee if such discrimination is due, in whole or in part, to the employee's lawful, good faith act done, or perceived by the employer to have been done or about to be done--
(1) to provide information, directly cause information to be provided, or otherwise directly assist in any investigation regarding any conduct which the employee reasonably believes constitutes a violation of any Federal law, rule, or regulation relating to railroad safety or security, or gross fraud, waste, or abuse of Federal grants or other public funds intended to be used for railroad safety or security, if the information or assistance is provided to or an investigation stemming from the provided information is conducted by--
(A) a Federal, State, or local regulatory or law enforcement agency (including an office of the Inspector General under the Inspector General Act of 1978 (5 U.S.C. App.; Public Law 95-452);
(B) any Member of Congress, any committee of Congress, or the Government Accountability Office; or
(C) a person with supervisory authority over the employee or such other person who has the authority to investigate, discover, or terminate the misconduct;
(2) to refuse to violate or assist in the violation of any Federal law, rule, or regulation relating to railroad safety or security;
(3) to file a complaint, or directly cause to be brought a proceeding related to the enforcement of this part or, as applicable to railroad safety or security, chapter 51 or 57 of this title, or to testify in that proceeding;
(4) to notify, or attempt to notify, the railroad carrier or the Secretary of Transportation of a work-related personal injury or work-related illness of an employee;
(5) to cooperate with a safety or security investigation by the Secretary of Transportation, the Secretary of Homeland Security, or the National Transportation Safety Board;
(6) to furnish information to the Secretary of Transportation, the Secretary of Homeland Security, the National Transportation Safety Board, or any Federal, State, or local regulatory or law enforcement agency as to the facts relating to any accident or incident resulting in injury or death to an individual or damage to property occurring in connection with railroad transportation; or
(7) to accurately report hours on duty pursuant to chapter 211.49 U.S.C. § 20109(a) (emphasis added).
Here, Plaintiff's Amended Complaint avers he reported to his supervisor (Tobin) and his supervisor's supervisor (Greer) that a railway machine was being handled in a dangerous manner. Am. Compl. ¶¶ 14, 16. Greer advised Plaintiff he would “check on the situation and get back to Plaintiff.” Id. ¶ 16. The situation was also reported to a safety supervisor. Id. ¶ 17. See Pl. Mem. 3-4 (citing portions of subsection (a) in support of its claims). This suffices to set out a plausible protected activity under 49 U.S.C. § 20109(a).Although the language of subsection (a) also applies to reports that result in investigations, participation in an actual investigation is not necessarily required. See Desk Aid 5 (offering subsection (a) example of a prohibition of retaliation against “an employee of the contractor for providing information to the employer regarding conduct that the employee reasonable believes violations FRA rules or for providing information to the National Transportation Safety Board regarding facts related to a railroad accident.” (emphasis added)). As Plaintiff has pleaded a plausible cause of action under 49 U.S.C. § 20109(a), Defendant's Motion to Dismiss the FRSA retaliation claim should be denied.
This recommended ruling considers the plausibility of Plaintiff's pleaded allegation as to his reporting only. Nothing herein is intended as a definitive ruling that Plaintiff's actions were protected for purposes of any post-discovery analysis.
The court also considers whether Plaintiff plausibly has pleaded a violation of subsection (b), which protects railroad carriers' employees from retaliation for, inter alia, “reporting, in good faith, a hazardous safety or security condition[.]” 49 U.S.C. § 20109(b)(1)(A). Harsco argues it is not a “railroad carrier,” making subsection (b) inapplicable. Def. Mem. 3-4; Reply 2-5. In his brief response to this argument, Plaintiff looks to the allegations of his Amended Complaint, submitting Harsco is both a contractor and a railroad carrier. Plaintiff argues he has at least presented a question of fact as to whether Harsco would be considered a “railroad carrier” for purposes of the statute. Pl. Mem. 3-4.
The FRSA defines a “railroad carrier” as a “person providing railroad transportation . . . .” 49 U.S.C. § 20102(3). A “railroad” is defined as follows:
(2) “railroad”--
(A) means any form of nonhighway ground transportation that runs on rails or electromagnetic guideways, including--
(i) commuter or other short-haul railroad passenger service in a metropolitan or suburban area and commuter railroad service that was operated by the Consolidated Rail Corporation on January 1, 1979; and
(ii) high speed ground transportation systems that connect metropolitan areas, without regard to whether those systems use new technologies not associated with traditional railroads; but
(B) does not include rapid transit operations in an urban area that are not connected to the general railroad system of transportation.49 U.S.C. § 20102(2). Defendant sets out the Desk Aid's exemplar list of what type of concerns would be considered “railroad carriers” (long-distance, intercity passenger railroads; commuter railroads; short-haul passenger service (e.g., airport to downtown or to resort); high-speed ground transportation systems that connect metropolitan areas, regardless of technology used; and most tourist, scenic, and excursion railroads), submitting that Harsco's operation does not fit into any of these examples. Reply 4 (citing Desk Aid 6). On the other hand, Harsco's provision of service on tracks falls into what the Desk Aid lists as common contractors and subcontractors for purposes of subsection (a): manufacturers of railroad equipment, repair shops, track maintenance contractors, staffing firms, and medical contractors. Id.
Plaintiff's Amended Complaint alleges Defendant is both a “railroad carrier,” as that term is defined in 49 U.S.C. § 20102(3) and a “contractor or subcontractor of a railroad carrier” within the meaning of subsection (a) of 49 U.S.C. 20109, and it is “an employer subject to the antiretaliation provisions of 49 U.S.C. § 20109 of the FRSA.” Am. Compl. ¶ 37. Plaintiff submits the following allegations in the Amended Complaint “remove any doubt that it was ‘providing railroad transportation' in 2020,” Pl. Mem. 4:
33. Harsco has several business lines; in 2020, Harsco's rail operations, referred to by Harsco as “Harsco Rail,” represented approximately 18% of its revenues in 2020.
34. Harsco Rail engages in the research, development, sale, and aftermarket service and maintenance of a number of railroad items, including surfacing equipment, utility track vehicles, production grinders, tie equipment, and new track construction equipment, and its customers include “railroad carriers” as defined by 49 U.S.C. § 20102(3).
35. Harsco provides its customers both on-site technical assistance and training programs for the equipment it sells.
36. Moreover, Harsco offers “contracting services” to its customers. Harsco provides work crews that operate its customers' equipment, determine its customers maintenance need, and meets those needs. In its Form 10-K Annual Report for the fiscal year ending in December 31, 2020 filed with the United States Securities and Exchange Commission, which is incorporated herein by reference, Harsco touts that “Harsco Rail's contract service teams have covered more than 397 thousand miles of track, helping customers achieve desired productivity goals.”
37. While providing the foregoing services and products, Harsco provided railroad transportation to its own employees and equipment and for its customers. As such and at all times relevant to this Amended Complaint, Harsco was both a “railroad carrier” as defined in 49 U.S.C. § 20102(3) and a “contractor or subcontractor of a railroad carrier” within the meaning of 49 U.S.C. § 20109(a), and it was an employer subject to the anti-retaliation provisions of 49 U.S.C. § 20109 of the FRSA.Am. Compl. ¶¶ 33-37.
Plaintiff submits Harsco “cannot credibly suggest that it has not ‘provided railroad transportation' to its employees, customers, and equipment while covering those 397,000 miles of railroad track[.]” Pl. Mem. 4. “[I]n any event,” Plaintiff submits that the question of whether Harsco is a “railroad carrier” is a “dispute of fact” not properly considered at the Rule 12(b)(6) stage. Id.
Plaintiff has not, however, explained any particular “issue of fact” he believes exists. Rather, the issue to be considered is deciding whether, considering the facts as alleged by Plaintiff, Harsco falls into the statutory definition of a “railroad carrier.” Such an issue is one of law. That Harsco has “covered” a certain number of miles of track and that its “customers include ‘railroad carriers'” does not transform Harsco into a railroad carrier itself. In considering the sufficiency of Plaintiff's pleading, the court accepts all facts in the light most favorable to Plaintiff but is in no manner bound by his conclusions of law. Twombly, 550 U.S. at 555 (noting “courts are not bound to accept as true a legal conclusion couched as a factual allegation” (internal citation omitted)). Plaintiff has not plausibly pleaded a claim under 49 U.S.C. § 20109(b) because it has not pleaded facts from which it could plausibly be inferred that Harsco was “providing rail transportation.”' Section (b), therefore, is inapplicable. To the extent Defendant's Motion to Dismiss Plaintiff's FRSA retaliation claim seeks dismissal of Plaintiff's claim brought under 49 U.S.C. § 20109(b) it should be granted.
B. Defamation
Harsco seeks dismissal of Plaintiff's defamation cause of action, arguing Plaintiff has not alleged any actionable, nonprivileged defamatory statements were made to third parties. Def. Mem. 4-5. Alternatively, Defendant argues Plaintiff's defamation claim is time-barred because it was not “commenced” within South Carolina's applicable two-year statute of limitations. Id. at 5-6. Appropriately, both parties analyze the defamation claim under South Carolina law. Plaintiff submits he has pleaded a plausible defamation cause of action. Pl. Mem. 8-10. Plaintiff does not dispute or otherwise respond to Defendant's timeliness argument, however. Because it is potentially dispositive the court considers the timeliness argument first.
Defendant submits Plaintiff's defamation claim was not timely “commenced” based on applicable South Carolina law. In considering timeliness, a “‘federal court must honor state court rules governing commencement of civil actions when an action is first brought in state court and then removed to federal court.'” MidS. Carbon Corp. v. TriCamp Cap., LLC, 622 Fed.Appx. 223, 225 (4th Cir. 2015) (quoting Winkels v. George A. Hormel & Co., 874 F.2d 567, 570 (8th Cir. 1989)). See Kinder v. City of Myrtle Beach, No. 4:15-CV-01416-RBH, 2017 WL 227969, at *2 (D.S.C. Jan. 19, 2017) (in diversity context, noting that “a federal court must apply state law not only to determine the relevant statute of limitations but also to determine when a civil action is ‘commenced' for purposes of the limitations period.” (internal citations omitted), affd in part, appeal dismissed in part, 700 Fed.Appx. 287 (4th Cir. 2017).
Defamation claims are subject to a two-year statute of limitations that begins to run when the allegedly defamatory statement is made. S.C. Code Ann. § 15-3-550; Harris v. Tietex Int'l Ltd., 790 S.E.2d 411, 416 (S.C. Ct. App. 2016). “Unless an action is commenced before expiration of the limitations period, the plaintiff's claim is normally barred.” Blyth v. Marcus, 470 S.E.2d 389, 390-91 (S.C. Ct. App. 1996) (citing McLain v. Ingram, 444 S.E.2d 512 (S.C. 1994)). As Defendant has properly noted, South Carolina requires both filing of the summons and complaint and service on the defendant to commence a civil action. Section 15-3-20(B) of the South Carolina Code provides: “A civil action is commenced when the summons and complaint are filed with the clerk of court if actual service is accomplished within one hundred twenty days after filing.” S.C. Code Ann. § 15-3-20(B). Similarly, South Carolina Rule of Civil Procedure 3(a) provides:
(a) Commencement of civil action. A civil action is commenced when the summons and complaint are filed with the clerk of court if:
(1) the summons and complaint are served within the statute of limitations in any manner prescribed by law; or
(2) if not served within the statute of limitations, actual service must be accomplished not later than one hundred twenty days after filing.S.C.R. Civ. P. 3(a) (second emphasis added). As the South Carolina Supreme Court has explained:
[T]he legislative intent in amending section 15-3-20(B) in 2002 was to provide a safety net for cases where filing of the summons and complaint occurs near the end of the statute of limitations and service is made after the limitations period has run. The statute and the rule, read together, provide that (1) an action is commenced upon filing the summons and complaint, if service is made within the statute of limitations, and (2) if filing but not service is accomplished within the statute of limitations, then service must be made within 120 days of filing.Mims ex rel. Mims v. Babcock Ctr., Inc., 732 S.E.2d 395, 397-98 (S.C. 2012) (emphasis in original).
Liberally construing Plaintiff's Amended Complaint, the allegedly defamatory remarks were made on June 22, 2020, at the latest. See Am. Compl. ¶ 31. Plaintiff filed his Complaint in the Lexington County Court of Common Pleas on March 23, 2022. Compl., ECF No. 1-1. The Complaint was filed within the two-year limitations period. For the matter to have been “commenced” for purposes of South Carolina law, it also needed to be served on Defendant on or before July 21, 2022-120 days after the March 23, 2022 filing date. It was not. Defendant was served on July 22, 2022. Notice of Removal ¶ 17, ECF No. 1.
Defendant's Motion to Dismiss Plaintiff's defamation claim as untimely should be granted. See Bellamy v. Horry Cnty. Police Dep't, No. 419CV03462RBHKDW, 2020 WL 2559544, at *3 (D.S.C. Apr. 30, 2020), report and recommendation adopted, No. 419CV03462RBHKDW, 2020 WL 2556953 (D.S.C. May 20, 2020) (granting motion to dismiss claim as untimely when complaint was served but not filed within the relevant statute of limitations period and was not served within the 120-day grace period). This recommended ruling is bolstered by Plaintiff's failure to even address the timeliness issue in responding to the pending motion to dismiss, thereby arguably abandoning his defamation claim. See, e.g., Waiters v. Sci. Applications Int'l Corp., No. 2:17-CV-3227-BHH-BM, 2019 WL 5874132, at *10 (D.S.C. May 10, 2019) (stating plaintiff abandoned claim by failing to address in his memorandum in opposition to defendant's motion to dismiss argument raised in defendant's motion to dismiss), adopted by, 2019 WL 4462810 (D.S.C. Sept. 18, 2019); Jones v. Family Health Ctr., Inc., 323 F.Supp.2d 681, 690 (D.S.C. 2003) (noting that claim not addressed in opposition memorandum had been abandoned).
Even if Defendant's substantive argument is considered, the Motion to Dismiss should be granted as to Plaintiff's defamation claim. To establish defamation under South Carolina law, Plaintiff must show: “(1) a false and defamatory statement was made; (2) the unprivileged publication was made to a third party; (3) the publisher was at fault; and (4) either actionability of the statement irrespective of special harm or the existence of special harm caused by the publication.” Erickson v. Jones Street Publishers, LLC, 629 S.E.2d 653, 664 (S.C. 2006) (citation omitted). Plaintiff alleges Defendant granted Tobin the authority to make reports to HR and that “Tobin, as an authorized servant of the Defendant, knowingly made false accusations about Plaintiff and communicated these false statements to Plaintiff and human resources.” Am. Compl. ¶¶ 51-52. “Specifically,” Plaintiff continues, “Tobin falsely communicated to third parties that Plaintiff left the facility unauthorized while on shift.” Id. Defendant submits Plaintiff has included no allegation that defamatory remarks were made to any third party. The undersigned agrees. Plaintiff alleges Tobin had the authority to make reports to HR, and that is what he did. There is no allegation of a report to anyone not affiliated with Harsco. Plaintiff's defamation claim is subject to dismissal. See Gentry v. Bioverativ U.S. LLC, No. CV 2:19-00873-MBS, 2019 WL 3802476, at *9 (D.S.C. Aug. 13, 2019) (granting motion to dismiss defamation claim, noting alleged statement concerning plaintiff that involved a representative of defendant and someone from defendant's HR department did not satisfy the requirement that a privileged statement be published to a third party).
South Carolina courts typically include “falsity” in stating the elements of defamation. However, as the court noted in Jeter v. Allstate Insurance Co., No. CV 7:15-1458-TMC, 2016 WL 7115912, at *4 (D.S.C. Aug. 22, 2016), a private individual claiming defamation as to a matter that is not of public concern “has no duty to plead or prove falsity during [his] case-in-chief[.]” Id. at *12, n.4 (quoting Parrish v. Allen, 656 S.E.2d 382, 392 (S.C. Ct. App. 2007)). Truth is an affirmative defense as to which the defendant has the burden of proof unless the statement involves a constitutional issue. Id.
C. Wrongful discharge, Breach of Employee Handbook
Finally, Defendant seeks dismissal of what Plaintiff calls a “Fifth and Alternative Cause of Action” for “Wrongful Discharge, Breach of Employee Handbook.” Am. Compl. page 13. In his pleading, Plaintiff cites to and quotes specific portions of Harsco's employee handbook,including portions of the retaliation policy and a vacation-related policy, alleging the mandatory language of such policies creates a contract between him and Harsco. Am. Compl. ¶ 88. Plaintiff submits that Defendant did not follow the mandatory language of the quoted policies and “did not adhere to its progressive discipline plan or its whistleblower procedure outlined in its policies thereby breaching its employment contract with Plaintiff.” Am. Compl. ¶ 89. Defendant submits the Handbook does not constitute a contract and includes a conspicuous disclaimer to that effect. Def. Mem. 6-7 (citing, inter alia, SC Code Ann. § 41-1-110). Even if the disclaimer itself does not suffice to require dismissal of this cause of action, Defendant argues, Plaintiff has pointed to no mandatory provisions of Handbook that altered his at-will status and were breached. Id. at 78.
As Plaintiff directly references and relies on the handbook in his Complaint and Amended Complaint, the court may consider the document on Harsco's motion to dismiss without converting the motion to one for summary judgment under Rule 56. See Givens v. Erie Ins. Co., C. A. No. 6:22-842-HMH, 2022 WL 2759167, at *3 (D.S.C. 2022). In Plaintiff's Amended Complaint he cites to a copy of the Employee Handbook that Defendant had provided in connection with its now-moot motion to dismiss. Handbook, ECF No. 4-2. Defendant has provided a copy of the same handbook as an exhibit to its pending Motion. ECF No. 15-2. For congruity, the court will cite to the ECF-generated page number of the Handbook found at 15-2 herein.
A plaintiff alleging breach of contract must plead the existence of a valid contract, consisting of offer, acceptance and consideration. Roberts v. Gaskins, 486 S.E.2d 771, 773 (1997). In South Carolina, there is a presumption of at-will employment. Prescott v. Farmer's Tel. Co-Op., Inc., 516 S.E.2d 923, 927 n.8 (1999). Therefore, the employee plaintiff must “plead sufficient factual allegations to establish the existence of an employment contract beyond the at-will relationship.” Amason v. P.K. Mgmt., LLC, No. 3:10-cv-1752-JFA, 2011 WL 1100169, at *6 (D.S.C. Mar. 23, 2011). This requires pleading that the employee and employer entered into a contract “with terms of employment that limited the duration of the relationship or the right of termination or both.” Weaver v. John Lucas Tree Expert Co., No. 2:13-cv-1698-PMD, 2013 WL 5587854, at *6 (D.S.C. Oct. 10, 2013). In some instances, an employer may alter the employee's at-will status through mandatory language in a handbook. Grant v. Mount Vernon Mills, Inc., 634 S.E.2d 15, 20 (S.C. Ct. App. 2006). Language in an employee handbook may create an employment contract only when “(1) the handbook provisions and procedures in question apply to the employee; (2) the handbook sets out procedures binding on the employer; and (3) the handbook does not contain a conspicuous and appropriate disclaimer.” Bishop v. City of Columbia, 738 S.E.2d 255, 259 (S.C. Ct. App. 2013) (citations omitted).
Section 41-1-110 of the South Carolina Code provides as follows:
It is the public policy of this State that a handbook, personnel manual, policy, procedure, or other document issued by an employer or its agent after June 30, 2004, shall not create an express or implied contract of employment if it is conspicuously disclaimed. For purposes of this section, a disclaimer in a
handbook or personnel manual must be in underlined capital letters on the first page of the document and signed by the employee. For all other documents referenced in this section, the disclaimer must be in underlined capital letters on the first page of the document. Whether or not a disclaimer is conspicuous is a question of law.S.C. Code Ann. § 41 -1-110.
In support of its argument that its Handbook contains the requisite conspicuous disclaimer language, Defendant looks to Handbook's “first substantive page” as well as the “Employee Handbook Acknowledgement and Receipt” signed by Plaintiff. See ECF No. 15-2 at 4 (“first substantive page,” containing a two-paragraph “Important Notice,” which begins by indicating the handbook “is an outline; it does not constitute a contract.”). The “Important Notice” and the following paragraphs are underlined and in all capital letters. Id. (e.g., “IMPORTANT NOTICE”). Defendant has identified Plaintiff's signed “Employee Handbook Acknowledgement and Receipt” as being on “Harsco Employee Handbook: pg. 1.” ECF No. 152 at 58 (signed by Plaintiff on December 11, 2018); see also id. at 2 (unsigned copy of “Employee Handbook Acknowledgement and Receipt”). Defendant seeks dismissal based on the disclaimer.
Plaintiff disagrees, arguing the disclaimer does not satisfy the statutory requirements. Plaintiff's argument focuses only on the “Employee Handbook Acknowledgement and Receipt,” indicating it is not signed and, even if were, it is neither underlined or in capital letters. Plaintiff does not reference the “Important Notice” disclaimer found on the “first substantive page.” Pl. Mem. 5-7.
Defendant submits the disclaimer may be considered conspicuous for purposes of the statute even when it is on the “page after the cover page of the handbook.” Reply 5 (citing and quoting Bishop v. City of Columbia, 738 S.E.2d 255, 258-60 (S.C. Ct. App. 2013)).
Having reviewed the disclaimer pages the undersigned cannot recommend a finding as a matter of law that they satisfy S.C. Code Ann. § 41 -1-110. Defendant's characterization of the disclaimer as being on the “first substantive page” notwithstanding, the “Important Notice” disclaimer, which includes the required typography, is on the second page after the cover. For the court to dismiss a breach of an implied employment contract claim based on the disclaimer alone, it must plainly apply with all statutory requirements. Cf. Smith v. Daimler Trucks NA, LLC, No. CV 7:14-2058-BHH-KFM, 2016 WL 762605, at *13 (D.S.C. Jan. 21, 2016), report and recommendation adopted, No. CV 7:14-2058-BHH, 2016 WL 741390 (D.S.C. Feb. 25, 2016) (finding disclaimer did not meet statutory requirements because entire disclaimer, although in all capital letters, was not all underlined).
The undersigned notes Defendant's citation to Bishop and agrees that the “first page” statutory requirement may at times be satisfied by having a compliant conspicuous disclaimer on the “first page after the cover page” of the handbook. Bishop, 738 S.E.2d at 258-60. Here, though, Defendant has indicated the “Employee Handbook Acknowledgement and Receipt” was “Harsco Employee Handbook: pg. 1.” ECF No. 15-2 at 58; see also id. at 2. Were the properly capitalized-and-underlined “Important Notice” language found at ECF No. 15-2 at 4 also on that first page, this recommendation would be different.
However, finding the disclaimer is not conspicuous as a matter of law does not end the court's analysis. Plaintiff must also identify portions of the Handbook that are mandatory, are applicable to him, and were breached. Grant, 634 S.E.2d at 20. To be considered mandatory language, the purported contract must be “definitive in nature, promising specific treatment in specific situations.” Anthony v. Atl. Grp., Inc., 909 F.Supp.2d 455, 467 (D.S.C. 2012). It must not be “couched in permissive language” such as “normally” and “should.” Grant, 634 S.E.2d at 21-22. Plaintiff “must direct the court to some particular provision he claims was violated that limited the employer's right to discharge him” and “the handbook promise must restrict the right of an employer to discharge.” Lawrence v. Westinghouse Savannah River Co., Inc., No. 1:03-cv-0484-27, 2005 WL 36968031, at *4 (D.S.C. Mar. 31, 2005).
In his Amended Complaint, Plaintiff looks to the following excerpts from the Handbook as providing the mandatory language:
85. With respect to certain policies and procedures, Harsco's employee handbook uses mandatory language in many sections including but not limited to Harsco's retaliation policy.
86. Specifically, Harsco's retaliation policy uses the following mandatory language:
a. “The Company will neither engage in nor tolerate unlawful retaliation of any kind against any person. . .” [ECF No. 4-2, p. 12].
b. “Harsco will not permit any retaliation against an employee who has made a complaint or report of discriminatory harassment.” [ECF No.: 4-2, p. 9].
87. Other non-compliant, binding, and mandatory language is used in the following non-exhaustive locations within the Defendant's handbook:
a. “Any officer, manager, supervisor, other employee, agent or nonemployee who, after appropriate investigation, has been found to have engaged in unlawful discrimination, harassment or retaliation and/or inappropriate behavior inconsistent with this policy (even if not unlawful) will be subject to appropriate corrective action, up to and including termination of his or her employment or other relationship with our Company.” [ECF No. 4-2, p.13].
b. “Employees must call the main number at 803-822-9160, choose option 8 and leave a message as to their status as well as their request to use Emergency Vacation or Personal Time Off (PTO).” [ECF No. 4-2, p. 55].
88. Such language creates a binding contract between Defendant's employees and the Defendant.
89. In terminating Plaintiff, Harsco, through its agents and employees, failed to adhere to the progressive discipline plan or its whistleblower procedure outlined in its policies thereby breaching its employment contract with Plaintiff.Am. Compl. ¶¶ 85-88 (citing copy of Handbook found at ECF No. 4-2, which corresponds to the copy of the Handbook found at ECF No. 15-2). In responding to the pending Motion Plaintiff further discusses the anti-retaliation clause, indicating the clause “mandated that [Plaintiff] ‘must report' the retaliation he was suffering ‘immediately by contacting your Division Human Resources Leader. You may neither keep the complaint confidential nor investigate the complaint on your own.'” Pl. Mem. 7 (citing [ECF No. 4-2, p. 12, (ECF No. 15-2 at 12)). Plaintiff submits that, in exchange for Plaintiff's required reporting, Defendant “promised” [Plaintiff] the following:
[that Plaintiff's complaint of retaliation] will be investigated promptly, thoroughly and impartially. Further, the existence and nature of your complaints, as well as the identity of any complainant, witness or accused, will be disclosed only to the extent necessary to conduct a prompt, impartial and thorough investigation or as may be necessary to take appropriate corrective measures. The Company will neither engage in nor tolerate any form of unlawful retaliation, as set forth above.Handbook, ECF No. 4-2 at 12, (ECF No. 15-2 at 12). Without further detailed legal analysis, Plaintiff submits these provisions “are definitive in nature, promise specific treatment in specific situations, and restrict the right of Harsco to discharge Daniels; therefore Daniels has plead the requirements of an action for breach of implied contract of employment.” Pl. Mem. 7 (citing Anthony, 909 F.Supp.2d at 467 (citing Hessenthaler, 616 S.E.2d at 698)).
Defendant disagrees, first noting the Handbook itself indicates that employment is “at will.” Def. Mem. 7; see Handbook, ECF No. 15-2 at 3, 4 (acknowledgment and disclaimer); ECF No. 15-2 at 14-15 (indicating employees are “at-will,” meaning they “are not guaranteed employment or any particular job or type of work for any specified period of time; both Harsco and the employee have the right to terminate the employment relationship at any time and for any or no reason and with or without prior notice”). Further, Defendant acknowledges the Handbook “endorses a policy of progressive discipline”; however, the Handbook specifically provides that progressive discipline is not required. Def. Mem. 7. The Handbook's “Rules of Conduct” sets out various “Group 1” and “Group 2” Rule Violations. Handbook, ECF No. 15-2 at 21. The Handbook also contains this specific language:
The disciplinary procedure set forth below will be followed in most circumstances. However, the Company reserves the right, at its discretion, to omit one or more steps of the Disciplinary Policy, when, in the sole judgement of the Company, circumstances require.Id. (italics in original). Further the Handbook indicates violations of certain rules of conduct “may” result in disciplinary action. Id. at 22-23.
Further, while the Handbook includes several references to nonretaliation, and the section quoted by Plaintiff in his Amended Complaint (ECF No. 15-2 at 8, 10-12, 42), includes some mandatory language, none of the Handbook's provisions limit Defendant's right to discharge an employee further than the obligations already imposed by applicable employment laws. A “handbook or policy provision at issue must ‘restrict the right to discharge' and ‘must also make a promise that the employee is entitled to something related to discharge.'” Parker v. Premise Health Emp. Sols., Inc., No. CV 3:18-2740-MGL-KDW, 2020 WL 6218795, at *19 (D.S.C. June 5, 2020) (quoting Lawrence, 2005 WL3968031, at *14). Here, the policy language regarding discrimination, while including mandatory language, is in no way tied to a promise as to Plaintiff's employment status. Similarly, the mandatory language regarding the need to call in as to taking emergency vacation is not tied to a promise as to employment status. ECF No. 15-2 at 55. Cf. Lawrence, 2005 WL 3968031, at *17 (noting attendance policy did not change the at-will nature of employment relationship as it did not “promise [p]laintiff that he would not be discharged if he reported to any manager.”).
Defendant's Handbook does not restrict its right to discharge Plaintiff at-will. Even if a promise were found to exist, Plaintiff has not plausibly alleged any breach. Plaintiff's wrongful termination/breach of contract claim should be dismissed.
IV. Conclusion and recommendation
Based on the foregoing, the undersigned recommends Defendant's Motion to Dismiss, ECF No. 15, be granted in part and denied in part as to Plaintiff's FRSA retaliation claim as discussed above. If this R&R is adopted, this matter will proceed as to the FRSA and Section 1981 claims.
If the R&R is adopted, the court will issue a scheduling order upon Defendant's filing of an answer.
IT IS SO RECOMMENDED.