Dunn et al v. Reynolds School District No. 7 et al, No. 3:2009cv01259 - Document 29 (D. Or. 2010)
Court Description: OPINION AND ORDER: Defendants' Motion for Summary Judgment 18 is granted in part, and denied in part. Signed on 11/15/10 by Magistrate Judge Dennis J. Hubel. (kb)
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Dunn et al v. Reynolds School District No. 7 et al Doc. 29 1 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF OREGON 8 PORTLAND DIVISION 9 10 11 12 13 14 15 16 SUSAN DUNN and HEIDI MASUNAGA,) ) Plaintiffs, ) ) v. ) ) REYNOLDS SCHOOL DISTRICT NO. 7) a political subdivision of the) State of Oregon and public ) body corporate, and ROBERT ) FISHER, an individual, ) ) Defendants. ) ) No. CV-09-1259-HU OPINION & ORDER 17 18 James Brown 215 SW Washington St., Ste. 202 Portland, Oregon 97204 19 Attorney for Plaintiffs 20 21 22 Barrett C. Mersereau Peter R. Mersereau MERSEREAU & SHANNON, LLP 1 SW Columbia St., Ste. 1600 Portland, Oregon 97258 23 Attorneys for Defendants 24 25 26 27 28 1 - OPINION AND ORDER Dockets.Justia.com 1 HUBEL, Magistrate Judge: 2 Plaintiffs Susan Dunn and Heidi Masunaga bring claims for 3 violations of 4 discharge, breach 5 Reynolds School District No. 7 and its former superintendent, 6 Robert Fisher. 7 claims against them, as well as for qualified immunity for Fisher. 8 All 9 Magistrate Judge in accordance with Federal Rule of Civil Procedure parties civil of rights under contract, 42 U.S.C. and wage § 1983, claims, wrongful against the Defendants move for summary judgment as to all have consented to entry of final judgment 10 73 and 28 U.S.C. § 636(c)). 11 by a grant defendants' motion, in part, and deny, in part. 12 For the reasons set forth below, I FACTS 13 In the spring of 2009, plaintiff Susan Dunn was the principal 14 of Davis Elementary School. 15 commenced July 1, 2008, and was scheduled to end on June 30, 2011. 16 Pl.'s Resp. Def.'s Concise Statement Material Facts at ¶ 8; Def.'s 17 Reply Pl.'s Concise Statement Material Facts at ¶ 1. 18 Heidi Masunaga was the principal for Alder Elementary School, and 19 also had a three-year contract that commenced on July 1, 2008 and 20 was scheduled to end on June 30, 2011. 21 of defendant Reynolds School District No. 7 ("the District"), in 22 Fairview, Oregon. 23 She had a three-year contract that Id. Plaintiff Both schools are part As part of their compensation, the District provided group 24 health insurance to the plaintiffs. 25 a 26 reimbursement benefit, the plaintiffs and other District employees 27 submitted 28 administrators medical reimbursement documents program. reflecting In addition, the District had In health evaluated the documents 2 - OPINION AND ORDER order to expenses, before obtain and the District reimbursing the 1 plaintiffs. 2 District and Reynolds Administrators' Association For 2003/04, 3 2004/05, 2005/06" outlined the reimbursement benefit as, The "Memorandum of Agreement between Reynolds School 4 A. 5 . . . . 6 3. The unused monthly portion of the budgeted insurance/TSA benefit shall remain in a pool for use by individual administrators to recover deductible or co-pay costs incurred under the above insurance plans. 7 Medical Insurance: 8 Decl. Barrett Mesereau Ex. 9, at 2. The "Memorandum of Agreement 9 between Reynolds School District and Reynolds Administrators' 10 Association For 2006/07, 2007/08, 2008/09" was more specific about 11 the benefit, 12 13 3. Administrators carrying individual or family medical insurance through the District may be reimbursed for the following: 14 15 16 17 a. Deductible costs for required medical procedures and required prescriptions covered by the insurance policy (e.g. insurance pays only 80%, reimbursable is remaining 20%). b. Co-pay costs for medical visits or hospitalization (e.g. $15.00 fee for a doctor appointment). 18 Reimbursement is not available for: 19 20 a. Alternative medical procedures or healthy life style activities not covered by the insurance policy (e.g. spa, health club, vitamins, etc.). 21 22 b. Surgery or medical procedures, or prescriptions of an elective or optional nature even if covered by the insurance policy (e.g. cosmetic surgery). 23 24 25 Id., Ex. 10, at 2. On November 28, 2008, defendant Robert Fisher, the 26 superintendent of the District, sent the plaintiffs a letter 27 stating, in part, 28 The district made a series of errors in administering the 3 - OPINION AND ORDER 1 program. 2 ! The district did not pool the unused benefit dollars. ! The district paid for elective procedures. ! The district paid claims from documents that did not contain sufficient information to determine if the payment covered a co-payment or deductible. ! The district paid claims for non-covered items effectively expanding the coverage to all out-of-pocket medical expenses. 3 4 5 6 7 8 9 10 11 12 13 These errors are serious. They involve questionable use of taxpayer dollars and they serve as an example of the district's poor management practices. Being proactive, I have board and legal support to: ! Seek investigation into the practices to determine if any crime has been committed in the administration of the program. ! Demand and pursue collection of all payments made to administrators for elective procedures. ! Bill and pursue collection of all payments for dental services, eyewear and contact lenses, and goods and services that were not covered by the insurance plan or the reimbursement program. 14 Id. Ex. 3, at 1; Ex. 4 at 1. 15 had been conducted of all records from July 1, 2002, through 16 November 28, 2008. 17 "paid $3,508.40 in error." 18 the letter indicated she was "paid $5,755.51 in error." 19 4, at 2. 20 enclosed copies of claims paid in error and respond to the district 21 regarding your plans for repayment by December 17, 2008." Id., Ex. 22 3, at 2; Ex. 4, at 2. The letter indicated that a review In Dunn's case, the letter indicated she was Id., Ex. 3, at 2. In Masunaga's case, Id., Ex. Both letters asked the plaintiffs to "[p]lease review the 23 According to plaintiffs, Fisher told them "don't complicate 24 your lives by getting attorneys mixed up in this because . . . I'm 25 contacting the district attorney and this is a serious matter and 26 it involves public funds and misuse of public funds." Decl. Robert 27 Brown, Att. 8, at 4. Dunn and Masunaga, however, retained counsel, 28 who wrote in a letter dated January 12, 2009, "It has been reported 4 - OPINION AND ORDER 1 to me that the district's superintendent has intimated to one or 2 more of the district's administrators it would not be in their best 3 interests to involve legal counsel regarding these matters." 4 Att. 9, at 1; Att. 10, at 1. Id., 5 The letter also formally alerted the District that plaintiffs 6 did not believe the district had a legal right to demand the 7 overpayments back, and asked that the Districts demands regarding 8 the alleged overpayments cease and desist. 9 10 11 12 13 14 15 16 17 18 19 On April 3, 2009, Fisher sent Dunn and Masunaga letters restating the District's demands, My review indicates that if you do not refund the medical expense reimbursement that was improperly approved, you may be in violation of ORS Chapter 244, as well as TSPC Standards for Competent and Ethical Performance of Oregon Educators, particularly OAR 584-020-0035(2)(a), which states that educators must "adhere to the conditions of a contract or the terms of appointment;" and (e) to "not use the district's or school's name, property, or resources for non-educational benefit or purposes without approval of the educator's supervisor of the appointing authority" in this case the approval of the Board of Directors, which adopted the administrators' agreement and its terms. Since you have not complied with my request for you to reimburse the District during the last four months, on behalf of the District, I am now giving you the following directives. 20 21 You are to refund to the District the total . . . that was paid to you as reimbursement for non-covered medical expenses. 22 23 You are hereby directed further to submit a check to my office for the full amount . . . made out to the District, by April 22, 2009. 24 25 26 27 28 Failure to repay the reimbursement not authorized under the terms and conditions of the Board-approved administrators' agreement will be considered insubordination on your part, because you will be willfully disobeying an order that the superintendent of the Reynolds School District has a right to give; and, you will be considered also in neglect of your duties, including your duty to accept only that compensation from 5 - OPINION AND ORDER 1 the District which was authorized by the Board-approved administrators' agreement. 2 3 4 It is extremely important for you to know, to be informed, and to be aware that both insubordination and the neglect of duty are grounds for dismissal of a contract administrator under ORS 342.865(1). Therefore, it is my hope that you will comply with this directive. 5 Id. Att. 11, at 1-2; Att. 12, at 1-2. 6 On April 22, 2009, both plaintiffs submitted letters of 7 resignation to Fisher, effective June 30, 2009. Mersereau Decl. 8 Ex. 1, at 1; Ex. 2, at 1. Both plaintiffs mentioned in their 9 letters that they had many unused vacation days and expected to be 10 paid for them. 11 Fisher sent a follow-up letter on April 23, 2009, which 12 stated, in part, 13 14 On April 22, 2009, you willfully disobeyed my order and did not repay the District. . . which you have been notified would be considered insubordination. 15 16 17 18 19 20 Before I make my recommendation to dismiss you from the Reynolds School District to the Board of Education, I am scheduling a pre-termination hearing for you to respond to the potential charges leading to your dismissal. The hearing will be on Tuesday, April 28, 2009 . . . in my office. Id. Att. 13, at 1, Att. 14, at 1. School board member Shelly Chase testified that her 21 understanding regarding Fisher's recovery method was that "if it 22 wasn't paid back, then the employees would be . . . [t]erminated." 23 Id. Att. 19, at 2. 24 not paid the money and [Fisher] was going to terminate them." 25 Att. 19, at 4. 26 testified that "if [Fisher] recommended [termination] to the board, 27 the board would stand behind it." 28 school board member, Donna Edgley, characterized Fisher's strategy, Later, Chase was "told [Dunn and Masunaga] had Id., Another school board member, Richard Phelps, 6 - OPINION AND ORDER Id., Att. 20, at 2. Yet another 1 "It was, from the very, very beginning, this is what we're doing 2 and they're going to pay it back or they're not going to work here. 3 And that was it." 4 Id., Att. 22, at 2. Despite the resignation letters, Fisher moved forward and held 5 the scheduled April 28, 2009 pre-termination hearing. 6 few details about what happened at the pre-termination hearing. On 7 May 4, 2009, Fisher wrote the plaintiffs again: 8 There are Please be advised that I have accepted your resignation effective June 30, 2009, in lieu of moving forward with a recommendation for dismissal. 9 10 After reflecting upon your comments in your April 22, 2009, letter and the comments made at the hearing, I see no reason to continue moving toward termination, especially since you submitted your letter of resignation . . . . 11 12 13 Now that I have accepted your resignation, please be advised of the following: 14 1. You are required to use all of your unused vacation days, which means your last workday will be May 20, 2009 . . . . 2. Please remove all of your personal belongings before May 20, 2009, so that you will not return to your school after your last day of work. 3. Unless you have received prior approval . . . you are not to be on any school campus after your last workday. 4. If you prefer to move your resignation date prior to May 20, 2009, and receive payment for your unused vacation pay on your last day of work, please submit a letter to Ken Richardson to that effect by 4:00 pm on Wednesday, May 6, 2009. 15 16 17 18 19 20 21 22 Brown Decl. Att. 15, at 1; Att. 16, at 1. 23 changed the last day of employment for the principals in order "to 24 save money for the district." 25 Fisher testified that he Att. 23, at 5. For reasons that are not addressed, Fisher only held the job 26 of superintendent for 14 months. 27 position the following school year. 28 /// 7 - OPINION AND ORDER Att. 23, at 4. He left the 1 STANDARDS 2 Summary judgment is appropriate if there is no genuine issue 3 of material fact and the moving party is entitled to judgment as a 4 matter of law. 5 initial responsibility of informing the court of the basis of its 6 motion, and identifying those portions of "'pleadings, depositions, 7 answers to interrogatories, and admissions on file, together with 8 the affidavits, if any,' which it believes demonstrate the absence 9 of a genuine issue of material fact." 10 Fed. R. Civ. P. 56(c). The moving party bears the Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986) (quoting Fed. R. Civ. P. 56(c)). 11 "If the moving party meets its initial burden of showing 'the 12 absence of a material and triable issue of fact,' 'the burden then 13 moves to the opposing party, who must present significant probative 14 evidence tending to support its claim or defense.'" Intel Corp. v. 15 Hartford Accident & Indem. Co., 952 F.2d 1551, 1558 (9th Cir. 1991) 16 (quoting Richards v. Neilsen Freight Lines, 810 F.2d 898, 902 (9th 17 Cir. 1987)). 18 designate facts showing an issue for trial. 19 322-23. 20 The nonmoving party must go beyond the pleadings and Celotex, 477 U.S. at The substantive law governing a claim determines whether a 21 fact is material. 22 Ass'n, 809 F.2d 626, 630 (9th Cir. 1987). All reasonable doubts as 23 to the existence of a genuine issue of fact must be resolved 24 against the moving party. 25 Radio, 475 U.S. 574, 587 (1986). 26 drawn from the facts in the light most favorable to the nonmoving 27 party. 28 T.W. Elec. Serv. v. Pacific Elec. Contractors Matsushita Elec. Indus. Co. v. Zenith The court should view inferences T.W. Elec. Serv., 809 F.2d at 630-31. If the factual context makes the nonmoving party's claim as to 8 - OPINION AND ORDER 1 the existence of a material issue of fact implausible, that party 2 must come forward with more persuasive evidence to support his 3 claim than would otherwise be necessary. 4 Research and Tech. Group, 916 F.2d 528, 534 (9th Cir. 1990); 5 California Architectural Bldg. Prod., Inc. v. Franciscan Ceramics, 6 Inc., 818 F.2d 1466, 1468 (9th Cir. 1987). 7 Id.; In re Agricultural DISCUSSION 8 Plaintiffs brought claims for a violation of their civil 9 rights under 42 U.S.C. § 1983, wrongful discharge, breach of 10 contract, and wage claims under Oregon law. 11 injunctive relief, in the form of reinstatement in their former 12 positions and expungement of all references to their terminations 13 and the surrounding accusations from the District s records. 14 Before the court is the District's motion for summary judgment on 15 all of plaintiffs claims except for injunctive relief. Defendants 16 also seek 17 qualified immunity on the § 1983 claims. 18 I. 19 to establish that Plaintiffs also seek defendant Fisher is entitled to Constructive Discharge The parties agree that a threshold issue is whether the 20 plaintiffs were constructively discharged. 21 under federal and state law, and plaintiffs bring claims under 22 both. The standard differs 23 A. 24 When a plaintiff brings a § 1983 claim based on constructive 25 discharge, the court evaluates the alleged constructive discharge 26 under federal law. 27 F.3d 936, 940-41 (9th Cir. 2009). 28 standard Federal for See e.g. Knappenberger v. City of Phoenix, 566 constructive 9 - OPINION AND ORDER discharge In the Ninth Circuit, the differs depending on the 1 circumstances. 2 the conditions of her working environment, the inquiry is whether 3 "working conditions bec[a]me so intolerable that a reasonable 4 person in the employee s position would have felt compelled to 5 resign?" Poland v. Chertoff, 494 F.3d 1174, 1184 (9th Cir. 2007). 6 A 7 "unendurable working conditions." 8 Institute of Tech., 96 F.3d 1305 (9th Cir. 1996). 9 Circuit also recognizes "employment claims based on a theory of 10 coercion," where "a resignation may be found involuntary if, from 11 the totality of the circumstances, it appears that the employer's 12 conduct in . . . obtaining the resignation effectively deprived the 13 employee of free choice in the matter." Knappenberger, 566 F.3d at 14 941 (citations omitted). 15 involuntary and constitute a deprivation of property for purposes 16 of a due process claim in the absence of intolerable working 17 conditions." In situations where an employee quits because of constructive discharge does not always, however, demand See e.g. Kalvinskas v. Cal. The Ninth In such situations, "resignation may be Id. 18 In Kalvinskas, a long-time employee was effectively given a 19 choice between retiring and receiving his pension or remaining 20 employed, but having the disability benefits he was receiving 21 reduced to nothing. 22 because a reasonable person in [his] position would feel he had no 23 choice but to retire, Kalvinskas's retirement was involuntary for 24 purposes of the ADEA's prohibition of retirement plans that require 25 or permit involuntary retirement. 26 Kalvinskas's choice to be involuntary not because of discriminatory 27 or intolerable working conditions, but rather, "because of the 28 coercion inherent in the choice between retirement and a complete 96 F.3d at 1306. 10 - OPINION AND ORDER The Ninth Circuit held that, Id. at 1308. The court deemed 1 deprivation of income." 2 675, 683 (9th Cir. 1983) 3 resigning could demonstrate he left his employment involuntarily). 4 Here, the evidence in the record shows that the plaintiffs 5 were given the ultimatum to pay thousands of dollars in a short 6 period of time, or be fired. 7 validity or legality of the ultimatum. 8 that "if one is fired, that's a big black mark on your record" and 9 "you are not going to get another job." Id.; see also Lojek v. Thomas, 716 F.2d (suggesting an employee coerced into There was no mechanism to contest the Plaintiff Dunn testified Brown Decl. Att. 7, at 7. 10 Plaintiff Masunaga testified, "Rather than being fired, I resigned 11 . . . [b]ecause I knew I needed a job, and I was not going to get 12 a job if I was going to be fired from the school district." 13 Decl. Att. 8, at 4. 14 Given the coercion inherent in the ultimatum to Brown pay a 15 substantial sum of money or be fired, and based on the evidence of 16 the negative effects of being fired, I find that, from the totality 17 of the circumstances, there is a question of fact whether the 18 District's conduct in obtaining the resignation of the plaintiffs 19 deprived 20 effectively constructively discharging plaintiffs under federal 21 law. Dunn and Masunaga of free choice in the matter, 22 B. 23 Plaintiffs argue that under Sheets v. Knight, 308 Or. 220, 779 24 P.2d 1000 (1989), an individual has been constructively discharged 25 if she resigned rather than be fired. 26 Sheets was expressly overruled by McGanty v. Stadenraus, 321 Or. 27 532, 557, 901 P.2d 841,856-57 (1995), which holds, 28 Oregon Law The District responds that to establish a constructive discharge, a plaintiff must 11 - OPINION AND ORDER 1 6 allege and prove that (1) the employer intentionally created or intentionally maintained specified working condition(s); (2) those working conditions were so intolerable that a reasonable person in the employee's position would have resigned because of them; (3) the employer desired to cause the employee to leave employment as a result of those working conditions or knew that the employee was certain, or substantially certain, to leave employment as a result of those working conditions; and (4) the employee did leave the employment as a result of those working conditions. 7 The Oregon Supreme Court, however, has held that McGanty did not 8 overrule Sheets with respect to the relevant issue. 9 Wyle Laboratories Corp., 327 Or. 433, 439, 963 P.2d 678, 681 2 3 4 5 See Stupek v. 10 (1998). 11 of the elements of constructive discharge, it also cited Sheets for 12 the proposition that "[a] forced resignation may support a claim 13 for wrongful discharge." 14 15 16 17 Although the Stupek court quoted the McGanty formulation Id. The Stupek court explained, Where the employee unconditionally has been told 'resign today or be fired,' the employer has decided that the employment relationship is at an end and that the employee shall leave. The employee merely selects the manner in which the employer's will is accomplished. Under such circumstances a fact finder may find that a 'resignation' was a discharge. 18 Id. (citing Sheets, 308 Or. at 227). 19 Court 20 McGanty's requirement that working conditions were so intolerable 21 that a reasonable person in the employee's position would have 22 resigned because of them. effectively held that In so explaining, the Supreme Sheets offers an alternative to 23 Here, the evidence demonstrates that Fisher insisted Dunn and 24 Masunaga would have to pay substantial sums of money to pay back 25 allegedly erroneous reimbursements they had received, if they 26 wanted to continue working for the District. 27 fired. 28 substantially Pay us back or be By April 23, 2009, Fisher knew Dunn and Masunaga were certain 12 - OPINION AND ORDER to leave their employment, one way or 1 another, 2 requesting payment, he wrote, 3 because of the condition he'd imposed. No On April 22, 2009, you willfully disobeyed my order and did not repay the District the [money], which you have been notified would be considered insubordination. Before I make my recommendation to dismiss you from the Reynolds School District to the Board of Education, I am scheduling a pre-termination for you to respond to the potential charges leading to your dismissal. 4 5 6 7 Brown Decl. Att. 13, at 1; Att. 14, at 1. 8 resigned "in lieu of being terminated from my position." 9 Decl. Att. 8, at 4. 10 longer Viewed in the Brown Dunn resigned "[b]ecause if [she] didn't resign [she] would be fired." 11 In her words, Masunaga light Brown Decl. Att. 7, at 7. most favorable to the nonmoving 12 plaintiffs, there is an issue of material fact whether a finder of 13 fact would find that in this case plaintiffs' resignations were 14 actually discharges. 15 the state law issue is denied. 16 II. Defendants' motion for summary judgment on Violation of Due Process Rights Under the Fourteenth Amendment 17 In their complaint, plaintiffs allege that "Defendant Fisher, 18 while acting under color of state law, effected taking of plaintiff 19 Masunaga s property in violation of her right to due process of 20 law" by "coercing her resignation . . . . terminating plaintiff's 21 employment . . . . [and] by depriving plaintiff access to the 22 judicial process for determination of a matter in dispute between 23 her and her employer." 24 language of the complaint alleges two property interests each: a 25 property interest in the job of principal and a property interest 26 in the unused accrued vacation days. 27 the complaint alleges a procedural due process violation. 28 13 - OPINION AND ORDER Compl. ¶ 35. Broadly construed, the In addition, the language of 1 A. 2 The Fourteenth Amendment protects against the deprivation of Procedural Due Process 3 property or liberty without due process. 4 U.S. 247, 259 (1978); Brady v. Gebbie, 859 F.2d 1543, 1547 (9th 5 Cir. 6 procedural due process thus has three elements: (1) a liberty or 7 property interest protected by the Constitution; (2) a deprivation 8 of the interest by the government; and (3) lack of process. 9 Portman v. County of Santa Clara, 995 F.2d 898, 904 (9th Cir. 10 1988). A § 1983 claim based See Carey v. Piphus, 435 upon the deprivation of 1993). 11 1. 12 Property Interest Protected by Constitution a. Property Interest in Employment 13 An employee has a constitutionally protected property interest 14 in continued employment if he has a "reasonable expectation or a 15 'legitimate claim of entitlement' to it." 16 1547-48 (quoting Roth, 408 U.S. at 577.). 17 entitlement 18 understandings that stem from an independent source, such as state 19 law. 20 Fire Protection Dist. No. 10, 74 Or. App. 550, 554 (1985). 21 statute, rule or contract may also confer the property interest. 22 Trivoli, 74 Or. App. at 554. 23 arises if it is created Brady, 859 F.2d at A legitimate claim of by existing rules or See id. at 1548; see also Trivoli v. Multnomah County Rural A Here, the District concedes that both plaintiffs had contracts 24 for employment with it from July 1, 2008, through June 30, 2011. 25 Therefore, each had a constitutionally protected property interest 26 in continued employment through the end date of the contracts. 27 28 b. Property Interest in Unused Vacation Days The Supreme Court has held, 14 - OPINION AND ORDER 1 7 The procedural component of the Due Process Clause does not protect everything that might be described as a 'benefit': To have a property interest in a benefit, a person clearly must have more than an abstract need or desire and more than a unilateral expectation of it. He must, instead, have a legitimate claim of entitlement to it. Such entitlements are, of course, ... not created by the Constitution. Rather, they are created and their dimensions are defined by existing rules or understandings that stem from an independent source such as state law. . . . Our cases recognize that a benefit is not a protected entitlement if government officials may grant or deny it in their discretion. 8 Town of Castle Rock, Colo. v. Gonzales, 545 U.S. 748, 756 (2005) 9 (internal citations and quotations omitted). 2 3 4 5 6 10 The Ninth Circuit has never considered the precise question of 11 whether accrued leave is the type of property protected by the 12 Fourteenth Amendment. 13 898, 906 (9th Cir. 1993). 14 analogous question of whether accrued sick leave is protected. Id. 15 at 907. 16 because deprivation of a specific employment benefit is a loss 17 which is easily defined, "entitlement to accumulated sick leave, 18 although a property interest, is not constitutionally protected." 19 Id. at 906 (citing Ramsey v. Bd. of Education, 844 F.2d 1268, 1272 20 (6th Cir. 1988).). Portman v. County of Santa Clara, 995 F.2d The Ninth Circuit declined to answer an The court noted, however, that in the Sixth Circuit, 21 In a District of Arizona case analogous to the case at bar, a 22 school principal was asked to resign from her position while under 23 contract. 24 951963, at *1 (D. Ariz. 2007). 25 against 26 violation of her due process rights with regard to non-payment of 27 her accrued sick leave. 28 written policy of the District is clear that in order to receive the Ordway v. Lucero, No. CV-04-1046-PCT-MHM, 2007 WL school district, 15 - OPINION AND ORDER The principal brought a § 1983 case claiming Id. at *6. among other things, a The court noted that "the 1 payment for such leave upon separation, the employee must have ten 2 years of continuous service with the District." 3 the principal in the case did not have ten years of service, the 4 court held that the principal did not have a property interest in 5 her unpaid leave. 6 7 Here, Since Id. Reynolds Personnel Policy entitled GCDC Administrator Vacation, dated January 4, 2007, read, 8 Vacation When Terminating. Administrators whose contract year runs July 1 through June 30, and who have vacation available as a benefit, will be paid for unused vacation time, not to exceed forty-two days (forty-three days if a leap year is involved). 9 10 11 the Id. at *7. Brown Decl. Att. 17, at 1. 12 The clear contractual language creates a property right in the 13 unused vacation days. 14 2. 15 Deprivation of Interest by Government Again, in the Ninth Circuit, "resignation may . . . constitute 16 a deprivation of property for purposes of a due process claim." 17 Knappenberger, 566 F.3d at 941. 18 local governmental entity, qualifies as the government for purposes 19 of a § 1983 due process claim. 20 School Dist. No. 40, 907 F. Supp. 1423, 1435-36 (D. Or. 1995). 21 a. A school district, which is a See Plumeau v. Yamhill County Deprivation of Employment by Government 22 I have already held that there is a material issue of fact 23 whether the plaintiffs' resignations were involuntary, and thus a 24 constructive 25 employer whose conduct obtained the resignation, Fisher, on behalf 26 of the District, qualifies as the government under this prong of 27 the test. 28 /// discharge. 16 - OPINION AND ORDER Defendants do not contest that the 1 b. Deprivation of Unused Vacation Days 2 Dunn and Masunaga's resignation letters set an effective date 3 of June 30, 2009, and set forth that they expected to be paid for 4 any unused vacation days in addition to being paid under the 5 contract through June 30. 6 Fisher modified the terms of plaintiffs' resignations, and wrote: 7 1. You are required to use all of your unused vacation days, which means your last workday will be May 20, 2009 . . . . On acceptance of the resignations, 8 9 10 4. If you prefer to move your resignation date prior to May 20, 2009, and receive payment for your unused vacation pay on your last day of work, please submit a letter to Ken Richardson to that effect by 4:00 pm on Wednesday, May 6, 2009. 11 Brown Decl. Att. 15, at 1; Att. 16, at 1. 12 There are situations in which an employer may legitimately 13 force an employee to use vacation days during a set period. For 14 example, under FMLA, "an employer may require the employee, to 15 substitute any of the accrued paid vacation leave. . . for [FMLA 16 leave] . . . for any part of the 12-week period of such leave." 29 17 U.S.C. § 2612(d)(2)(A); see also 29 C.F.R. § 825.207. "The logical 18 purpose underlying the substitution language in the FMLA and 19 accompanying regulations is to protect employers who offer paid 20 . . . leave benefits to their employees from having to provide both 21 the statutory 12 weeks of leave required by the FMLA and the paid 22 leave benefit separately." Strickland v. Water Works and Sewer Bd. 23 of City of Birmingham, 239 F.3d 1199, 1206 (11th Cir. 2001). By 24 analogy, the District could perhaps argue that it was not required 25 to both pay the plaintiffs through their desired resignation date 26 of June 30, as well as provide a lump sum for unused vacation days 27 after that date. 28 17 - OPINION AND ORDER 1 The District did not, however, make such an argument, whatever 2 its merits might be on these facts, in the motion. 3 argued first that the plaintiffs had no property interest in their 4 unused vacation days because it wasn't in the contract, and second, 5 that Dunn agreed to take her vacation days before leaving work both 6 arguments, however, are controverted by evidence in the record. 7 Therefore, on the basis of the arguments in support of the motion, 8 I hold there is an issue of fact whether Fisher, acting on behalf 9 of the District, deprived the plaintiffs of their property right in 10 The District the unused vacation days. 11 3. Lack of Process 12 "The base requirement of the Due Process Clause is that a 13 person deprived of property be given an opportunity to be heard at 14 a meaningful time and in a meaningful manner." 15 Educ. of Lynwood Unified School Dist., 149 F.3d 971, 984 (9th Cir. 16 1998). 17 before or after the deprivation, so long as the opportunity to be 18 heard is meaningful. Brewster v. Bd. of Depending on the circumstances, the hearing may be held Id. 19 At times the question of whether a deprivation occurred 20 without due process requires an analysis of whether available state 21 law process can constitute "due process." 22 Sprinklers, Inc., 532 U.S. 189, 195-97 (2001). 23 breach 24 deprivation of a property right derived from a contract, unless the 25 deprivation constitutes a denial of a present entitlement." DeBoer 26 v. Pennington, 287 F.3d 748, 750 (9th Cir. 2002). 27 Court has described "present entitlement" as "a right by virtue of 28 which [one is] presently entitled either to exercise ownership of contract claim 18 - OPINION AND ORDER provides Lujan v. G & G Fire adequate A "common law process for the The Supreme 1 dominion over real or personal property, or to pursue a gainful 2 occupation." Lujan, 532 U.S. at 190. 3 In Lujan, a state agency determined that a subcontractor on a 4 public works project had violated the California Labor Code, and 5 issued 6 subcontractor. 7 parties under § 1983, claiming that the issuance of the notices 8 without a hearing violated its due process rights. 9 The Court held that the subcontractor "ha[d] not been denied any 10 present entitlement," but merely a "payment that it contends it is 11 owed under a contract," which in turn is an interest "that can be 12 fully protected by an ordinary breach-of-contract suit." 13 196. (distinguishing the case from situations in which a claimant 14 is denied "a right by virtue of which he was presently entitled 15 either 16 property, or to pursue a gainful occupation"). 17 Court stated, "[w]e hold that if California makes ordinary judicial 18 process available to respondent for resolving its contractual 19 dispute, that process is due process." Id. at 197. 20 notices to directing the Id. at 191-93. exercise a. ownership withholding of payment to the The subcontractor sued the state dominion over real Id. at 193. or Id. at personal In summary, the Lack of Process Regarding Employment 21 Here, defendants moved for summary judgment as to plaintiffs' 22 § 1983 claims on the basis that plaintiffs were not deprived of 23 their employment because they resigned. 24 against this claim by attempting to show that the process afforded 25 Dunn and Masunaga was adequate. Defendants did not move 26 I have already held there is an issue of material fact whether 27 the defendants deprived the plaintiffs of a property interest in 28 their jobs. The issue remains whether the plaintiffs were given an 19 - OPINION AND ORDER 1 opportunity to be heard at a meaningful time and in a meaningful 2 manner under Brewster. 3 The evidence in the record shows that Fisher held a pre- 4 termination hearing on April 28, 2009. 5 the record about what transpired at the hearing. 6 established the absence of a material issue of fact whether Dunn 7 and 8 meaningful 9 motion as to this claim is denied. Masunaga were manner. 10 11 b. Under afforded Lujan, an There are few details in opportunity Accordingly, to defendant's Fisher has not be heard summary in a judgment Lack of Process Regarding Vacation Days plaintiffs' property right in their unused 12 vacation 13 Plaintiffs allege they were entitled to payment for a specific 14 number of vacation days, presumably with each vacation day worth a 15 certain amount. Just as in Lujan, this property right can be fully 16 protected by an ordinary breach of contract suit. Therefore I find 17 that a typical state law breach of contract action would constitute 18 due process. 19 deprived of judicial process. days is easily definable and governed by contract. There is nothing in the record suggesting they were 20 Accordingly, with respect to the claims for accrued vacation 21 days, I grant defendants' motion for summary judgment against the 22 § 1983 procedural due process claims. 23 B. 24 The substantive component of the Due Process Clause forbids Subtantive Due Process 25 the government 26 property in such a way that shocks the conscience or interferes 27 with rights implicit in the concept of ordered liberty. Nunez v. 28 City of Los Angeles, 147 F.3d 867, 871 (9th Cir. 1998) (quoting from 20 - OPINION AND ORDER depriving a person of life, liberty, or 1 United States v. Salerno, 481 U.S. 739, 746 (1987)); Daniels v. 2 Williams, 474 U.S. 327, 331 (1986) (explaining that substantive due 3 process 4 oppressively exercised). A threshold requirement to a substantive 5 or procedural due process claim is the plaintiff's showing of a 6 liberty 7 Wedges/Ledges of Cal., Inc. v. City of Phoenix, 24 F.3d 56, 62 (9th 8 Cir. 1994). Most courts around the country have rejected the claim 9 that substantive due process protects the right to a particular 10 public employment position, and the Ninth Circuit has yet to decide 11 the issue. 12 97 (9th Cir. 2007). protects or against property government interest power protected by arbitrarily the and Constitution. Engquist v. Oregon Dept. of Agric., 478 F.3d 985, 996- 13 The Supreme Court has not specified the boundaries of the 14 right to pursue a profession, but has identified it generally. See 15 Conn v. Gabbert, 526 U.S. 286, 291-92 (1999) (stating that there is 16 some generalized due process right to choose one's field of 17 private employment ). 18 recognizing the right all deal with a complete prohibition of the 19 right 20 interruption. 21 liberty interest in pursuing an occupation of one's choice. 22 Dittman v. Cal., 191 F.3d 1020, 1029-30 (9th Cir. 1999). 23 plaintiff can make out a substantive due process claim if she is 24 unable to pursue an occupation and this inability is caused by 25 government actions that were arbitrary and lacking a rational 26 basis. 27 cert. denied, 543 U.S. 1149 (2005); Wedges/Ledges, 24 F.3d at 65. 28 But see Zorzi v. County of Putnam, 30 F.3d 885, 895 (7th Cir. 1994) to engage in The Court has noted, however, that cases a calling, Id. at 292. and not [a] sort of brief The Ninth Circuit has recognized the See A Sagana v. Tenorio, 384 F.3d 731, 742-43 (9th Cir. 2004), 21 - OPINION AND ORDER 1 (holding that this occupational liberty is protected only by 2 procedural due process rights, and not substantive due process). 3 Almost all of the Ninth Circuit cases recognizing this 4 substantive due process right dealt with government legislation or 5 regulation, and not the acts of a government as an employer, which 6 allegedly 7 profession. 8 claims for a public employer's violations of occupational liberty 9 are limited to extreme cases, such as a government blacklist, prevented the plaintiff from Engquist, 478 F.3d at 997. pursuing a specific Substantive due process 10 which 11 employers effectively excludes the blacklisted individual from his 12 occupation, much as if the government had yanked the license of an 13 individual in an occupation that requires licensure. 14 98. 15 Cir.1997)). 16 protection 17 access to a particular profession to the same degree as government 18 regulation." 19 when circulated (quoting or Olivieri otherwise v. publicized Rodriguez, 122 F.3d to prospective Id. at 997- 406, 408 (7th Put another way, "there is substantive due process against government employer actions that foreclose Id. at 998. In Engquist, the plaintiff worked for the Oregon Department of 20 Agriculture. 21 statements about planning to fire the plaintiff, during a budget 22 crisis, the supervisor discharged the plaintiff. 23 After being discharged, the plaintiff applied to roughly 200 jobs, 24 and was not offered a position by any employer. 25 suit against her former employer for violation of her substantive 26 due process rights, the plaintiff presented evidence that her 27 supervisors made defamatory statements about her to two or three 28 others in the industry. Id. at 990. 22 - OPINION AND ORDER After a supervisor made repeated Id. at 999. Id. Id. at 991. After filing There was no evidence, 1 however, 2 plaintiff's inability to procure another job in her given field. 3 Id. 4 present sufficient evidence to sustain her substantive due process 5 claim." that the defamatory statements were the cause of Therefore, the Ninth Circuit held that the plaintiff "did not Id. 6 1. Substantive Due Process Claim for Employment 7 Here, plaintiffs resigned in order to avoid a "black mark" 8 that might have inhibited their abilities to practice their chosen 9 profession. I held, above, that Fisher's conduct in obtaining the 10 resignations may equate to constructive discharge. 11 plaintiffs might argue that Fisher's conduct related to their 12 constructive discharge rises to the level of making the plaintiffs 13 unable 14 plaintiffs preemptively resigned, thus avoiding the damaging result 15 of 16 employment elsewhere as a principal. 17 the plaintiffs mitigated the damage that might have occurred. to the 18 pursue "black their mark" and profession. the On the corresponding other Thus, the hand, inability the to find By analogy to contract law, The facts of this case are less egregious than those of 19 Enquist, 20 defamatory comments to others in the industry, and the plaintiff 21 unsuccessfully applied to two hundred jobs. 22 evidence shows only that plaintiffs resigned or were constructively 23 discharged. 24 mere 25 profession to the same degree as a government regulation, and thus 26 constitute a substantive due process violation. where the plaintiff was fired, the supervisor made In this case, the There is no case law in the Ninth Circuit holding that discharge, without more, could foreclose access to a 27 Accordingly, to the extent plaintiffs' claim a violation of 28 substantive due process as to their employment, I grant summary 23 - OPINION AND ORDER 1 judgment to the defendants. 2 3 2. There are Substantive Due Process Claim for Benefits no Ninth Circuit cases where a plaintiff has 4 succeeded in asserting a substantive due process claim for the 5 value of lost vacation days, or anything similar, upon termination. 6 Fisher's actions as to the vacation days did not deprive Dunn or 7 Masunaga of property in such a way that shocks the conscience or 8 interferes with rights implicit in the concept of ordered liberty. 9 Accordingly, to the extent plaintiffs claim a substantive due 10 process violation with respect to accrued vacation time, I grant 11 summary judgment to the defendants. 12 13 In summary, defendants' motion for summary judgment against plaintiffs' 14 (1) procedural due process claims for employment is denied, 15 (2) procedural due process claims for unused vacation days is 16 17 18 granted, and (3) substantive due process claims is granted. III. Qualified Immunity 19 With respect to § 1983 claims that involve, as here, a defense 20 of qualified immunity, the United States Supreme Court has stated: 21 Section 1983 provides a federal cause of action against any person who, acting under color of state law, deprives another of his federal rights. 42 U.S.C. § 1983. In order to prevail in a § 1983 action for civil damages from a government official performing discretionary functions, the defense of qualified immunity that our cases have recognized requires that the official be shown to have violated 'clearly established statutory or constitutional rights of which a reasonable person would have known.' Harlow v. Fitzgerald, 457 U.S. 800, 818 (1982). 22 23 24 25 26 27 Conn v. Gabbert, 526 U.S. 286, 290 (1999). 28 entitled to qualified immunity for his "official conduct so long as 24 - OPINION AND ORDER A defendant is 1 that 2 clearly-established federal rights." 3 Boise, Idaho, ___F.3d___ , 2010 WL 3895700, 15 (9th Cir. 2010). conduct is objectively reasonable and does not violate Cmty. House, Inc. v. City of 4 I have already held, above, that plaintiffs' § 1983 claims, 5 inasmuch as they intend to state a claim for substantive due 6 process, do not survive summary judgment. 7 analyze qualified immunity for those claims. 8 whether defendant Fisher met his burden of establishing that any 9 procedural due process claim raised by this factual record was not 10 There is no need to The issue, then, is clearly established at the relevant time. 11 I have previously noted in this opinion that defendant 12 Fisher's 13 occurred only. 14 regard, and without any challenge to the other aspects of a 15 procedural due process claim, nor to the law in that regard being 16 clearly established at the time of the acts in this case, Fisher 17 has failed to meet his burden of proving that he is entitled to 18 qualified immunity on the § 1983 claims. 19 this regard. 20 IV. 21 22 23 challenge was a challenge to whether a termination Having held there is a question of fact in this His motion is denied in Wrongful Discharge under Oregon Law Plaintiffs third and fourth claims for relief are for wrongful discharge under Oregon law, for Dunn and Masunaga, respectively. Under Oregon law, an employer may discharge an employee at any 24 time for 25 statutory, or constitutional requirement. 26 Corp., 333 Or. 401, 407, 40 P.3d 1059 (2002)(citing Patton v. J.C. 27 Penney Co., 301 Or. 117, 120, 719 P.2d 854 (1986)). 28 wrongful discharge is a narrow exception to this general rule. Id. any reason 25 - OPINION AND ORDER unless doing so violates a contractual, Babick v. Oregon Arena The tort of 1 Oregon courts have recognized two circumstances that give rise 2 to the common law tort of wrongful discharge: (1) discharge for 3 exercising a job-related right of important public interest and (2) 4 discharge for complying with a public duty. 5 407, 6 discharge for filing a worker's compensation claim (Brown v. 7 Transcon Lines, 284 Or. 597, 588 P.2d 1087 (1978)) and resisting 8 sexual harassment by a supervisor (Holien v. Sears, Roebuck & Co., 9 298 Or. 76, 689 P.2d 1292 (1984)). Examples of the second category 10 include discharge for serving on jury duty (Nees v. Hocks, 272 Or. 11 210, 536 P.2d 512 (1975)), for reporting patient abuse at a nursing 12 home (McQuary v. Bel Air Convalescent Home, Inc., 69 Or. App. 107, 13 684 P.2d 21 (1984)), and for refusing to sign a false report 14 regarding a fellow employee's work-related conduct (Delaney v. Taco 15 Time Int'l Inc., 297 Or. 10, 681 P.2d 114 (1984)). 40 P.3d 1059. Examples of the Babick, 333 Or. at first category include 16 In Oregon, however, the tort of wrongful discharge was not 17 intended to be a tort of general application, but rather an 18 interstitial tort to provide a remedy when the conduct in question 19 is unacceptable and no other remedy is available. Cantley v. DSMF, 20 Inc., 422 F. Supp. 2d 1214, 12220 (D.Or. 2006)(citing Draper v. 21 Astoria School Dist., 995 F. Supp. 1122, 1128 (D.Or.1998))(internal 22 quotation omitted). 23 278 Or. 347, 351-52, 563 P.2d 1205 (1977). "The underlying purpose 24 of that tort in this state is not to vindicate individual interests 25 of the employee by assuring that he or she receives the maximum 26 possible recovery, but rather to protect important public policies 27 by punishing conduct that thwarts those interests." 28 Astoria Sch. Dist., 995 F. Supp. 1122, 1130 (D.Or. 1998). Thus, a See also Walsh v. Consol. Freightways, Inc., 26 - OPINION AND ORDER Draper v. 1 claim for common-law wrongful discharge is not available in Oregon 2 if (1) an existing remedy adequately protects the public interest 3 in question and (2) the legislature has intentionally abrogated the 4 common-law remedies by establishing an exclusive remedy regardless 5 whether the courts perceive that remedy to be adequate. 6 Deschutes Cnty., 204 Or. App. 7, 14, 127 P.3d 655 (2006). Olsen v. 7 When determining whether the plaintiff may pursue both a 8 common law claim for wrongful discharge and a § 1983 claim arising 9 from the same facts, "the question is not whether the existing 10 remedy [under § 1983] is 'the best possible remedy' or 'identical 11 to 12 'adequately protect the employment related right.'" Draper, 995 F. 13 Supp. at 1134. 14 to protect the public interest in certain employment-related rights 15 of a public employee and, accordingly, has operated to dismiss the 16 plaintiff's wrongful discharge claims in those cases on summary 17 judgment or in response to motions to dismiss. 18 v. Multnomah Cnty., No. 08-CV-886, 2009 WL 1476689, at *12 (D.Or. 19 May 27, 2009); Baynton v. Wyatt, 411 F. Supp. 2d 1223 (D.Or. 2006); 20 Carlton v. Marion Cnty., No. 03-CV-6202, 2004 WL 1442598 (D.Or. 21 Feb. 19, 2002); Minter v. Multnomah Cnty., No. 01-CV-352, 2002 WL 22 31496404 (D.Or. May 10, 2002). 23 the tort remedy' but merely whether it is sufficient to Section 1983 generally provides an adequate remedy See, e.g., Shultz In Baynton, the plaintiff was a human resources manager for 24 defendant the Port of Portland. 25 performed a reorganization of labor, after which plaintiff was 26 asked to assume additional duties. 27 also discussed with her many policy issues, including public status 28 and management of resources, 27 - OPINION AND ORDER 411 F.Supp.2d at 1224. Id. possible The Port Plaintiff's supervisor discrimination against 1 African American employees, unequal pay increases, compensation for 2 public employees, 3 employees. Id. at 1224-25. Plaintiff was subsequently fired. Id. 4 at 1225. Plaintiff brought claims for wrongful discharge and under 5 § 1983. 6 claim on the basis that plaintiff already had an adequate statutory 7 remedy under § 1983. 8 an adequate remedy under § 1983 depending on the facts proven in 9 each claim and the defenses raised. Id. and pay increases for politically-connected Defendant moved to dismiss the wrongful discharge Id. Plaintiff argued that she may not have Id. Judge King held that "a 10 plaintiff suing under § 1983 for First Amendment retaliation has 11 the same remedies as under her wrongful discharge claim, and the 12 analysis does not require the court to determine the merits of the 13 claim; rather the court evaluates whether the claim, if proven, 14 provides an adequate remedy." 15 remedy under § 1983 was the same, if not better, than 16 under the wrongful discharge claim. 17 dismissed the wrongful discharge claim. 18 Id. The court held the plaintiff's Id. it would be On that basis, the court Id. Here, if proven, Dunn and Masunaga's § 1983 claim provides an 19 adequate remedy. 20 claims. 21 judgment as to the claims for wrongful discharge. 22 V. Therefore, the plaintiffs may not pursue both Accordingly, I grant the District's motion for summary Breach of Contract 23 Plaintiffs fifth, sixth, seventh, and eighth claims for 24 relief are for breach of contract related to pay for unused sick 25 days and for breach of the implied covenant of good faith and fair 26 dealing. 27 A. Unused Sick Pay 28 The District argues 28 - OPINION AND ORDER that there is no provision in the 1 Administrator Agreements that provides for payment for unused sick 2 days. 3 contain a provision reading: But the plaintiffs point out that the Agreements each 4 2. 5 Any benefit granted to the Reynolds Education Association . . . that is not covered in this agreement shall automatically accrue to administrators covered by this agreement (see Reynolds Education Association . . . contract[]). 6 7 Fringe Benefits: 8 Mersereau Decl., Ex. 9, at 1; Ex. 10, at 1. 9 agreement 10 between Reynolds School In turn, the 2006-2009 District and the Reynolds Education Association provides, in part, 11 4. 12 The District will make payment for unused, accumulated sick leave for employees retiring under the provision of PERS with the following provisions: 13 14 Payment for Unused Sick Leave a. day. Payments shall be $50.00 per accumulated sick leave 15 Brown Decl. Att. 18, at 3. 16 The District argues that because the Administrator Agreement 17 provision regarding Fringe Benefits only applies to benefits not 18 covered in this agreement, and because benefits available upon 19 early retirement are covered in the Agreement on page 5, the pay 20 for unused sick days provision in the Reynold Education Association 21 agreement does not apply. 22 I am not persuaded by the District's reasoning. The plain 23 meaning of the Fringe Benefits clause is that if a specific benefit 24 is not addressed in the Administrator Agreement, but the specific 25 benefit is granted under the Reynolds Education Association 26 contract, then the party signing the Administrator Agreement gets 27 the benefit. The early retirement provision of the Administrator 28 29 - OPINION AND ORDER 1 Agreement does not explicitly address payment for unused sick 2 leave. In order to avoid inclusion of the unused sick leave 3 benefit under 4 Agreement must contain explicit language that addresses unused sick 5 leave one way or another. 6 motion for summary judgment as to this claim is denied. the Fringe Benefits clause, It does not. the Administrator Accordingly, defendants' 7 B. 8 In general, every contract has an obligation of good faith in 9 Breach of Covenant of Good Faith and Fair Dealing its performance and enforcement under the common law. Elliott v. 10 Tektronix, Inc., 102 Or. App. 388, 396, 796 P.2d 361, rev den, 311 11 Or. 13, 803 P.2d 731 (1990). 12 good faith and fair dealing without also breaching the express 13 provisions of a contract." 14 addition, a claim for breach of the duty of good faith and fair 15 dealing "may be pursued independently of a claim for breach of the 16 express terms of the contract." 17 Ins. 18 dismissed, 318 Or. 476, 869 P.2d 859 (1994). 19 duty is to prohibit improper behavior in the performance and 20 enforcement of contracts, and to ensure that the parties "will 21 refrain from any act that would 'have the effect of destroying or 22 injuring the right of the other party to receive the fruits of the 23 contract.'" 24 89 P.3d 1249 (2004) (quoting Perkins v. Standard Oil Co., 235 Or. 25 7, 16, 383 P.2d 107 (1963)). Yet, the duty "cannot contradict an 26 express contractual term, nor otherwise provide a remedy for an 27 unpleasantly motivated act that is expressly permitted by the 28 contract." Co., 118 Or. App. "[A] party may violate its duty of Elliott, 102 Or. App. at 396. 377, In McKenzie v. Pac. Health & Life 381, 847 P.2d 879 (1993), rev The purpose of that Iron Horse Eng'g v. Nw. Rubber, 193 Or. App. 402, 421, Zygar v. Johnson, 169 Or. App. 638, 645, 10 P.3d 326 30 - OPINION AND ORDER 1 (2000), rev den, 331 Or. 584, 19 P.3d 356 (2001). 2 The duty "does not operate in a vacuum[,]" rather it "focuses 3 on the 'agreed common purpose' and the 'justified expectations' of 4 the parties, both of which are intimately related to the parties' 5 manifestation of their purposes and expectations in the express 6 provisions of the contract." 7 515-16, 60 P.3d 567 (2002). 8 faith 9 reasonable expectations of the parties. 10 and fair dealing OUS v. OPEU, 185 Or. App. 506, The common law implied duty of good serves to effectuate the objectively Klamath Off-Project Water Users, Inc. v. Pacificorp, 237 Or. App. 434, 445 (2010). 11 In their complaint, Dunn and Masunaga each simply allege, "By 12 threatening and thereafter initiating plaintiff s dismissal for the 13 purpose of coercing her to pay money, which was not a lawful basis 14 for any adverse employment action, defendant Fisher acted unfairly 15 and in bad faith." Compl. ¶¶ 56, 66. 16 Without citing any law, the District simply argues that it did 17 not breach the implied covenant of good faith and fair dealing 18 because no one terminated the principals they resigned. 19 I have already addressed the issue of resignation and held 20 there is a material issue of fact regarding whether the plaintiffs 21 were constructively discharged. 22 defendants' motion as to this claim, the District's motion for 23 summary judgment as to this claim is denied. 24 what will come of this claim at trial. 25 VI. Therefore, on the narrow basis of It remains to be seen Wage Claims 26 The plaintiffs argue that the provision for payment for unused 27 sick leave was compensation within the meaning of ORS 652.150, and 28 that failure to pay compensation for the unused sick leave was in 31 - OPINION AND ORDER 1 violation of the statute. 2 The statute delineates the penalty "if an employer willfully 3 fails to pay any wages or compensation of any employee whose 4 employment ceases, as provided in ORS 652.140 and 652.145." 5 652.150. 6 discharges an employee or when employment is terminated by mutual 7 agreement, all wages earned and unpaid at the time of the discharge 8 or termination become due and payable not later than the end of the 9 first business day after the discharge or termination." ORS In turn, ORS 652.140(1) provides, "When an employer "Wages" 10 means "all compensation for performance of service by an employee 11 for an employer whether paid by the employer or another person. 12 Wages include the cash value of all compensation paid in any medium 13 other than cash and all compensation owed an employee by an 14 employer." 15 As OAR 839-001-0410. discussed above, the Payment for Unused Sick Leave 16 provision 17 District and the Reynolds Education Association provides that 18 "[t]he District will make payment for unused, accumulated sick 19 leave" in the amount of 20 Brown Decl. Att. 18, at 3. 21 provides that employees will be compensated for unused, accumulated 22 sick leave. 23 falls within the meaning of "wages" under ORS 652.150. 24 25 in the 2006-2009 28 between Reynolds School "$50.00 per accumulated sick leave day." The sick leave provision expressly Due to the contractual language, such compensation Therefore, defendant's motion for summary judgment as to plaintiffs' wage claims is denied. 26 27 agreement CONCLUSION Defendants' motion for summary judgment [#18] is granted, in part, and denied, in part. 32 - OPINION AND ORDER Defendants' motion is 1 2 3 4 5 6 7 8 9 10 11 12 (1) granted with regard to plaintiffs' § 1983 claims for substantive due process, (2) granted with regard to procedural due process related to unused vacation days, (3) denied with regard to plaintiffs' § 1983 claim for procedural due process related to employment, (4) denied with regard to defendant Fisher's defense of qualified immunity, (5) granted with regard to plaintiffs' claims for wrongful discharge, (6) denied with regard to plaintiffs' claims for breach of contract, and 13 (7) denied with regard to plaintiffs' wage claims. 14 IT IS SO ORDERED, 15 16 Dated this 15th day of November , 2010. 17 18 /s/ Dennis J. Hubel 19 Dennis James Hubel United States Magistrate Judge 20 21 22 23 24 25 26 27 28 33 - OPINION AND ORDER
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