Petition for Writ of Certiorari — Passaic Valley Sewerage Commissioners v. United States Department of Labor
Supreme Court brief1993
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AUG 16 1993
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IN THE OF FG
Supreme Court of the United States
OcTOBER TERM, 1993
PASSAIC VALLEY SEWERAGE COMMISSIONERS
Petitioner,
VS.
UNITED STATES DEPARTMENT OF LABOR
AND
ROBERT REICH, THE SECRETARY OF LABOR
Respondent.
On Petition for a Writ of Certiorari to the
United States Court of Appeals for the Third Circuit
PETITION FOR WRIT OF CERTIORARI
Michael P. Ambrosio
Counsel of Record
Gabriel M. Ambrosio
~ GABRIEL M. AMBROSIO, ESQS.
464 Valley Brook Avenue
P.O. Box 911
Lyndhurst, New Jersey 07071
(201) 933-8844
QUESTION PRESENTED
Whether an employee's intracorporate complaint, consisting of
disruptive and persistent iniemal criticisms regarding the employer's
operating practices, constitutes a “proceeding” which is entitled to
protection under Section 507, the whistle-blower provisions, of the
Federal Water Pollution Control Act, 33 U.S.C. § 1367.
LIST OF PARTIES
Petitioner:
Passaic Valley Sewerage Commissioners
Respondents in Interest:
United States Depanment of Labor
Robert Reich, the Secretary of Labor
Other Respondent:
Joseph Guttman
RULE 29.1 LISTING
The Petitioner is a body politic and corporate created by an act of the
New Jersey Legislature. N.JLS.A. 58:14-1 et seg. As such, Peti-
tioner has no parent companies or non-wholly owned subsidianes
to list pursuant to Rule 29.1 of this Court.
ill
Page
uN WOR ENNEINS CRIED cas ssssssseseisnsssocssoncsenssevessne sasavesenssastss i
TABLE OF AUTHORITIES ............... eclannites esishmaee chilies iV
a 0s 9 Lana exn baa beasndciesibensinasnichveud sapveasaxnessendetors
a es pa cds hacceecosasiwisnvaks<aunde abchvsmsesessensvaese veces 2
STATUTORY PROVISIONS INVOLVED ....0......cccccccseeeeeees 3
NINE RE” UES PANS oi oss cacscnssesersvavessvassunsnsis cainceecenes 4
REASONS FOR GRANTING THE WRIT o.0......ccceccccccceceeeeeees 10
I. THE DECISION BELOW SQUARELY CONFLICTS WITH
THE OPINION OF THE FIFTH CIRCUIT IN BROWN & ROOT
v. DONOVAN, 747 F.2d 1029 (Sth Cir. 1984).
A. THESTATUTOR Y LANGUAGE OFTHE WHISTLE-BLOWER
STATUTES CANNOT BE STRETCHED TO ENCOMPASS
INTRACORPORATE COMPLAINTS.
B. THELEGISLATIVE HISTORIES OF THE WHISTLE-BLOWER
PROVISIONS SUPPORTS THE CONCLUSION THAT INTER-
NAL FILINGS ARE NOT PROTECTED.
C. THE STRUCTURE OF THECLEAN WATER ACT INDICATES
THAT §507IS DESIGNED TO PROTECT “WHISTLE-BLOW-
ERS” WHO PROVIDE INFORMATION TO GOVERNMEN-
TAL ENTITIES, NOT TO THEIR EMPLOYER
Il. THE INTENDED SCOPE AND REACH OF THE VARIOUS
FEDERAL ENVIRONMENTAL, SAFETY AND ENERGY
WHISTLE-BLOWER STATUTES IS A MATTER OF NA-
TIONAL IMPORTANCE WHICH SHOULD BE RESOLVED
BY THIS COURT.
ty EA 10
aegis ya wat dunsannckassaceunsasvans lovessivinaidsossesnale a-]
TABLE OF AUTHORITIES
CASES: Page
Brown & Root v. Donovan, 747 F.2d 1029
I TT I ic a ea eheae 11-14, 16
Consolidated Edison Co. v. Donovan, 673
a ne ae fe hs eee li
Kansas Gas & Electric Co. v. Brock, 780 F.2d 1505
10th Cir. 1985), cert. denied, 478 U.S. 1011 (1986) .......00000.2.. 1]
Mackowiak v. University Nuclear Systems.Inc.,
Fe ae © ee Hes I vos ea sede nec cd co dcn ve ee eke 1]
Passaic Valley Sewerage Commissioners v.
Init ates Department of Labor and Robert Reich
the Secretary of Labor, 992 F.2d 474 (3rd Cir. 1993) 00.0.0... l
Phillips v. Interior Board of Mine Operations Appeals,
$00 F.2d 772, 779 (D.C. Cir. 1974), cert. denied, 420
AE To Th. 2p} eee a eae NGL Aria Ao Rate Weeks 11,14
STATUTES
Federal
ee Fe FU eee ae eee a 10
42 U.S.C. § 7622
Comprehensive Environmental Response,
Comipensstion amd LARDGERY AGE occ icciseciccscnsscscsssesccscosscsosesncasvens 10
42 U.S.C. § 9610
Energy Reorganization Act Of 1974 ooo. eccceeeeeeeeeeeeeeecees 10-16
42 U.S.C. § 5846
42 U.S.C. § 5851(a)
Federal Mine Safety and Health Act of 1969 woo. 10, 14
30 U.S.C. § 815(c)(1)(formerly codified
at 30 U.S.C. § 820(b)(1)
_
STATUES continued Page
Federal Railroad Safety Authorization Act..........0.00000000000.00...... 10
45 U.S.C. § 441(a)
Federal Water Pollution Control Act of 1972 ................. PASSIM
Pe cs OE acd iroces tereemouals PASSIM
SF Urs Se RCT kaseridsndectsdc orci dncencemiee
Se eee siete cad esac a ee PASSIM
LER. 3S aaa Dy ks: . | Nala epee OMe Sith MOREA rz ee I< Cae ese 4
FF Fe BD ead a ce oa 4
PNSSIONIRE LBOOE TRCTIMNOINS AACE onc ccicccceccaneneesexseccevsntsesscncanessocenmness 10
29 U.S.C. § 158(a)(4)
Resource Conservation and Recovery ACt ...........2000ccccceeeeeeeeees 10
42 U.S.C. § 6971
RE TI ES FO Gi sicdecchcearcassePctscciterintisee ee 10
42 U.S.C. § 300(G)-9(i)
Toxic Substances Comtrol At ...............ccccccccecescccscocececoccoocccoccee 10
15 U.S.C. § 2622
State:
Picks GuUans UNINC Md, ett lanes or ecacaae ii, 4
Miscellaneous:
S.Rep.No. 414. 92d Cong., 2d Sess.
83 (1971), reprinted in 1972 U.S.C.C.A.N. 3748 .00.00...cc.. 12,14
Senate Report No. 848, U.S.C.C.A.N. 1978, p.7303 .......ccceeee 12
H.R.Rep. No. 1796, 95th Cong., 2d Sess. 16-17 (1978),
CF es M RIG, NOPE ON FUNG FINOD povsconsiasessiinsesaresssinscesesnconses 14
No.
IN THE SUPREME COURT OF THE UNITED STATES
October Term, 1993
PASSAIC VALLEY SEWERAGE COMMISSIONERS
Petitioner
¥.
UNITED STATES DEPARTMENT OF LABOR
and ROBERT REICH,
THE SECRETARY OF LABOR
Respondent
On Petition for a Writ of Certiorari to the
United States Court of Appeals for the Third Circuit
PETITION FOR WRIT OF CERTIORARI
OPINIONS BELOW
The decision of the United States Court of Appeals forthe Third
Circuit was rendered on April 16, 1993. That decision is reported
at 992 F.2d 474 and is. reproduced at pages 1a-16a of the appendix
to this petition (Pet. App.”).
The Final Decision and Order of the Secretary of Labor of the
United States Department of Labor, rendered. n March 13. 1992, is
unreported and is reproduced at Pet. App. 17a-32a.
The Recommended Decision and Order rendered by the Ad-
ministrative Law Judge on April 17, 1985, is unreported and is
reproduced at Pet. App. 33a-38a.
JURISDICTION
The decision of the Ur + > States Court of Appeals forthe Third
Circuit was issued on April 16, 1993. The time within which to file
this petition was extended to August 16, 1993, by Order of Justice
David H. Souter. The junsdiction of the Court is invoked pursuant
to 28 U.S.C. § 1254(1)
STATUTORY PROVISIONS INVOLVED
Section 507 of the Federal Water Pollution Control Act, 33
U.S.C. § 1367(a) [more commonly known as § 507 of the Clean
Water Act], provides that:
No person shall fire, or in any way discrim’-
nate against, or cause to be fired or discriminated
against, any employee or any authorized represen-
tative of employees by reason of the fact that such
employee or representative has filed, instituted, or
caused to be filed or instituted any proceeding
under this chapter, or has testified or is about to
testify in any proceeding resulting from the admin
istration or enforcement of the provisions of this
chapter.
STATEMENT OF THE CASE
On December 7, 1984, the Complainant, Joseph Guttman, filed
a claim with the Unites States Department of Labor (“Depanment’’)
alleging that he was discharged from his position with the Peti-
tioner, the Passaic Valley Sewerage Commissioners (“PVSC’’), in
violation of the employee protection provisions of the Federal
Water Pollution Control Act, 33 U.S.C. § 1367. The matter was
referred for investigation to the Wage and Hour Division of the
Department, which, by letter of January 7, 1985, found no merit to
the complaint. (Pet. App. 39a-41a). Thereafter, on January 11,
1985, Complainant requested a hearing with the Office of Admin-
istrative Law Judges. The hearing was conducted over a period of
1 1/2 days on February 19 and 20, 1985.
On April 17, 1985, the Administrative Law Judge (“ALJ”)
issued a Recommended Decision and Order (hereinafter the
“RD&O”) denying the Complainant’s claim and concluding that
there was no factual basis to sustain the allegation of retaliatory
discharge. (Pet. App. 33a-38a). Almost seven years after the ALJ
issued his recommendations, the Secretary of Labor (““Secretary”’)
reversed and concluded in a Final Decision and Order dated March
13, 1992, (hereinafter the “FD&O"), that the PVSC had discharged
Complainant in violation of employee protection provisions of the
Clean Water Act and ordered reinstatement with back pay. (Pet.
App. 17a-32a). On May 13, 1992, the PVSC filed a Petition for
review of the Secretary’s FD&O with the Circuit Court of Appeals
for the Third Circuit pursuant to 33 U.S.C, § 1367(b) and § 1369(b).
In its opinion issued on Apnil 16, 1993, the Third Circuit affirmed
the Secretary’s FD&O. (Pet. App. 1a-16a).
The PVSC is a body politic and corporate organized under the
laws of the State of New Jersey, N.LS.A. 58:14-1 et seg., which
operates one of the largest sewage treatment works in the nation. In
the early 1980's, the PVSC’s treatment works was upgraded to a
secondary treatment plant at a cost of approximately $500 million. !
Seventy-Five percent of the plant’s construction costs were paid
1 As a secondary treatment plant over 90 percent of pollutants are removed,
whereas formerly, as primary treatment facility, only 10-15 percent of pollutants
were removed.
through federal appropriations under 202 of the Federal Water
Pollution Control Act, 33 U.S.C. § 1251 et seg. (commonly known
as the Clean Water Act), bringing the PVSC operations under the
Clean Water Act regulations which condition federal funding. To
date, the PVSC has maintained one of the mostefficient and modem
facilities in the country. This efficiency is reflected in the fact that
the PVSC has consistently passed the annual operating audits of the
United States Environmental Protection Agency (“EPA’’) with near
perfect scores.
The Clean Water Act requires, as acondition of federal funding,
that recipients adopt a system of billing, or user charges, to assure
that each recipient of waste water treatment services pays its
proportionate share of the costs of operation and maintenance of the
waste treatment services. 33 U.S.C. § 1284(b)(1)(A). To comply
with this requirement, PVSC instituted an ad valorem user charge
system. Under this system, which was approved by the EPA and
was the subject of extensive public hearings”, users pay in propor-
tion to both the volume of waste water discharged to the system and
the concentration of dissolved and undissolved solids to be treated.
The PVSC implements its user charge system via customer self-
monitoring, whichis patterned after the self-monitoring procedures
incorporated in most National Pollutant Discharge Elimination
System (“NPDES”) Permits issued under the authority of the Clean
Water Act. Thus, the user charge system adopted by the PVSC
requires that each industrial user be responsible for sampling,
monitoring and reporting on its waste water discharges to the PVSC
Treatment Works. The user charge system is further designed to
allow the PVSC to perform periodic compliance checks of each
facility’s self-monitoring system and equipment.
A significant — and innovative — component of the self-
monitoring system implemented by the PVSC is its split-sampling
requirement. Essentially, in addition to its regular sampling proce-
dures, each industrial user must prepare a daily split sample,
whereby one sample would be analyzed by the industrial user and
the other would be analyzed by the PVSC. The split sample is
y soe . .
“In addition, the present user charge system has sustained at least one judicial
challenge and has been critically examined by a number of the systems users.
generally not utilized to calculate user charges.? Rather, the split
samples are utilized as a regulatory device which enable the PVSC
to evaluate the accuracy of the self-monitoring data collected by
users. Thus, by comparing its split sample test results with those
obtained by the industrial user, the PVSC can quickly and effi-
ciently determine whether the user is properly analyzing its dis-
charges or whether a problem exists.
The Complainant, Joseph Guttman, was hired by PVSC, effec-
tive March 31, 1980, as Chief of Laboratory and Stream Pollution
Control. Beginning in August 1981 and continuing for the duration
of his employment with the PVSC, Complainant was highly critical
of the split sample procedure. Guttman claimed that the lab was
being flooded with samples which he contended were unreliable
because they were taken by the system’s industrial users and not by
PVSC’s own inspectors. To remedy this problem — which he alone
perceived — Complainant recommended that PVSC’s inspectors
prepare the sample which would be “split”, on a yearly, rather than
daily, basis. Complainant essentially maintained that the split
sampling method of monitoring was unreliable and cost excessive
by reason of the excessive number of samples to be analyzed. Atthe
hearing before the ALJ, Guttman testified that the crux of his
Opposition to the split sample system was its “‘self-verification”’
component. In other words, Guttman insisted that only PVSC
personnel should be allowed to prepare the split sample. While
Guttman harbored objections to the PVSC user charge system, he
also admitted during the hearing before the ALJ that he had no
formal training or expericnce with respect to the design, develop-
ment or implementation of user charge systems.4
Sometime after Guttman first raised his concems over the user
charge system, the Executive Director of the PVSC, with approval
of the PVSC Commissioners, appointed the Chief of Industrial
Waste, Frank D’Ascensio, to oversee the laboratory and Supervise
3 In fact, most split samples are thrown away by the user and not collected by the
Pvc...
4 The record also establishes the fact that Guttman did not participate in the least
in the development of the user charge system adopted by the PVSC.
nel
Complainant. The record below shows that Complainant's and Mr.
D’Ascensio’s working relationship was extremely volatile, that
they disagreed strongly over the user charge system, and did not
generally communicate productively with each other in any re-
spect.” Mr. D’Ascensio testified that his relationship with the
Complainant deteriorated at an accelerated rate when Guttman
instituted the practice of throwing out the split samples collected by
Mr. D’Ascensio’s department. As a result of these and other
subversive activities, Mr. D’Ascensio believed that the Complain-
ant was deliberately attempting to sabotage the user charge system
and that Guttman’s behavior was jeopardizing the PVSC’s credit-
ability with its customers. On the basis of these actions, Mr.
D’Ascensio prepared a performance evaluation of the Complainant
on February 28, 1984, which was highly critical of Complainant’s
job performance and described the situation as “serious.” Shortly,
thereafter by memorandum of March 23, 1984, to Mr. D’Ascensio,
Complainant alleged that PVSC’s user charge verification system
violated the Clean Water Act and could not withstand a legal
challenge. While Guttman had been critical of the user charge
system for some time, his March 23, 1984 memo was the first time
that a Clean Water Act violation was articulated.
The PVSC’s in-house counsel responded to Complainant's
Memorandum of March 23, 1984, by a letter dated April 2, 1984,
asking Complainant to identify what statutory provisions the user
charge system violated and to otherwise explain its legal defects.
Complainant responded by memorandum of April 12, 1984, that
204 (b)(1)(A) of the Clean Water Act (33 U.S.C. § 1284(b)(1 )(A)]
was violated because the user charge system in place did not assure
proportionate cost sharing by system users. Mr. D’Ascensio
responded to Complainant’s March 23, 1984 Memorandum at
length on April 19, 1984 and rejected Guttman’s position-" The
Complainant was given an opportunity to brief the PVSC Commis-
sioners on May 15, 1984, at which time he presented his views on
5 The record below further demonstrates that others at the PVSC found Guttman
to be extremely excitable and incapable communicating with others. Indeed,
during the course of the hearing, the ALJ noted on the record several times that the
Complainant was disruptive and non-cooperative.
the user charge system. At the conclusion of that mecting, the
Commissioners solicited the opinion of in-house counsel who
represented that there was no “substance’’ whatsoever to the
Complainant’s allegations. On that basis, the Commissioners
rejected Guttman’s claims and have not revisited that issue to date.
Furthermore, most of the witnesses that appeared on behalf of the
PVSC testified that at no time were Guttman’s claims — that
PVSC’s user charge system was legally defective — taken sen-
ously.6
In March 1984, Mr. D’Ascensio recommended to the Execu-
tive Director of the PVSC, Carmine T. Perrapato, that Complainant
be terminated. Mr. D’Ascensio testified that he was afraid.the user
charge system was being deliberately undermined by Complainant,
who would not cooperate on defining what level of difference
between company and industrial analyses was acceptable, was
rejecting as unacceptable a suspiciously large number of samples
and was otherwise deliberately and maliciously undermining the
integrity and credibility of the system and the PVSC. During the
ALJ’s cross examination, Mr. D’Ascensio explained that his con-
cem for the integrity of the system was grounded upon Guttman’s
refusal to cooperate and Guttman’s lack of competence in the lab—
not Guttman’s memos, views or allegations conceming the legality
of the user charge system. In an attempt to mediate the differences
between Complainant and Mr. D’ Ascensio, the Executive Director
assigned the Personnel Manager to take over supervision of the
Complainant.
Some six months later, just prior to leaving PVSC, the Director
of Personnel recommended a reorganization plan to the Executive
Director. This plan combined several departments, including the
laboratory, under one head. All the departments would retain a
chief, except the laboratory, where the position of chief would be
eliminated. By memorandum of September 6, i984, the Executive
© During the hearing, Guttman admitted on the record that he threatened to report
his claim to the EPA only one time, which occurred during a telephone conversation
with PVSC’s in-house counsel. While he did not recall this threat, PVSC’s counsel
testified that he would not have conside-ed such a threai serious in light of
Guttman’s lack of legal training or other relevant expertise.
|
9
Director recommended to the Commissioners that the position of
Chief of Laboratory was unnccessary. The Executive Director
testified that elimination of Complainant’s job was strictly a cost
culling move, as the position was notneeded. On October 11, 1984,
the Commissioners adopted an official resolution implementing the
reorganization plan and eliminated the position of Chief of Labora-
tory effective November 10, 1984.
In his RD&Q, the ALJ concluded that Guttman had engaged in
protected conduct to the very limited extent that he may have
threatened to report the PVSC to the EPA during a telephone
conversation with PVSC’s in-house counsel (Pet. App. at 35a).
However, the ALJ further concluded that there was no relationship
between the complainant’s protected activity and his discharge. Id.
The Secretary, on the other hand, held that “Complainant’s exien-
sive reporting to PVSC officials over a period of years that PVSC’s
user charge system violated the [Clean Water Act] is an activity
fully protected under the [Clean Water Act].” (Pet. App. at 25a).
The Secretary went on to note “[t}hat Complainant’s views in this
regard may have been shown on this record to be wrong, narrow,
misguided, or, as the ALJ found, “‘ill-formed and not based on direct
knowledge, ..., does not render Complainant’s communication of
his views unprotected.” (Pet. App. at 26a).
The Third Circuit concluded that “‘|a]lthough there is evidence
which supports the proffered reason for Guttman’s employment
termination, there is substantial evidence that indeed Guttman’s
apparent lack of interpersonal skills contributed to his selection for
employment termination.” (Pet. App. at 6a). Nevertheless, the
Third Circuit ruled that the record supported the Secretary's conclu-
sion that Guttman’s employment was terminated in retaliation for
conduct which was protected under § 507 of the Clean Water Act
even though it was admittedly disruptive. Id. More specifically, the
Court reasoned that intracorporate complaints fell squarely within
the protection of the whistle-blower provisions of the Clean Water
Act. (Pet. App. at 9a). The Court also concluded that because
Guttman’s “personality” problems and lack of interpersonal skills
arose solely within the context of his “complaint activity” (regard-
ing the PVSC’s user charge system), the PVSC was prohibited by
§ 507 from taking any adverse action on the basis of that “complaint
activity.”” (Pet. App. at 15a).
10
REASONS FOR GRANTING THE WRIT
§ 507(a) of the Clean Water Act provides that no employee
may be fired “by reason of the fact that such employee ... has filed,
instituted, or caused to be filed or instituted any proceeding under
this chapter, or has testified or is about to testify in any proceeding
resulting from the administration or enforcement of the provisions
of this chapter.” (emphasis added). This case involves an issue that
has divided the lower courts — whether the act of making a purely
intemal and intracorporate complaint constitutes a “proceeding”
which falls within the protection of the “whistle-blower” provisions
of the Clean Water Act and a variety of similarly worded federal
environmental, safety and energy statutes.’ Because the affected
Statutes govem such a broad spectrum of activities and affect
literally millions of employer-employee relationships throughout
the United States, the answer to the question presented is of great
national concem.
In ruling that purely internal, intracorporate complaints are
protected by the whistle-blower provisions of the Clean Water Act,
the Third Circuit created a impenetrable shield behind which
incompetent and disgrunticd employees are free to attack the
discretionary decisions of management. So long as those attacks are
tangentially related to an issue within the jurisdiction of the general
statute, Management is utterly powerless to defend itself. Indeed,
the Complainant in this case hid behind this shield for more than
three years during which he used such means as sabotage to
dismantle the user charge system established by the PVSC and to
discredit the agency before its customers. Whether Congress
intended to afford protection to such “complaints” or “filings” is a
question which has clearly divided the lower courts, and therefore,
guidance from this Coun is urgently needed.
7 See e.g. 42 U.S.C. § 7622 [Clean Air Act}; 42 U.S.C. § 9610 [Comprehensive
Environmental Response, Compensation and Liability Act}; 42 U.S.C. § 300 () -
9 (i) [Safe Drinking Water Act]; 42 U.S.C. § 6971 [Resource Conservation and
Recovery Act}; 15 U.S.C. § 2622 [Toxic Substances Control Act]; 42 U.S.C. §
5851 [Energy Reorganization Act]; 30 U.S.C. § 815 (c) (1) [Federal Mine Safety
and Health Act]; 29 U.S.C. § 158 (a) (4) [National Labor Relations Act]; 45 U.S.C.
§ 441 (a) [Federal Railroad Safety Authorization Act].
1]
I. THE DECISION BELOW SQUARELY CON-
FLICTS WITH THE OPINION OF THE FIFTH
CIRCUIT IN BROWN & ROOT v. DONOVAN,
747 F.2d 1029 (Sth Cir. 1984).
In addition to the Third Circuit, at least four federal courts of
appeal have had occasion to address the issue of whether purely
intemal and intracorporate complaints fall within zone of protection
afforded the vanious whistle-blower statutes. Three of these courts
— the D.C. Circuit, Ninth Circuit and the Tenth Circuit — have
concluded thatintracorporate complaints are protected.® Mackowiak
vy. University Nuclear Systems, Inc., 735 F.2d 1159 (9th Cir.
1984)(Internal safety and quality control complaints protected
under the Energy Reorganization Act of 1974); Phillips v. Interior
Board of Mine Operations Appeals, 500 F.2d 772, 779 (D.C. Cir.
1974), cen. denied, 420 U.S. 938 (1975)(coal minor’s “notifica-
tion” to the foreman of possible dangers protected under Federal
Coal Miner Health and Safety Actof 1969)?; Kansas Gas & Electric
Co. v. Brock, 780 F.2d 1505 (10th Cir. 1985), cert. denied, 478 U.S.
1011 (1986)(intemal complaints protected under the Energy Reor-
ganization Act).'!° However, the conclusions reached by at least
two of these counts of appeal directly conflict with the opinion
rendered by the Filth Circuitin Brown & Rootv, Donovan, 747 F.2d
1029 (Sth Cir. 1984). There, the Fifth Circuit soundly rejected the
argument that the filing of a purely intemal, intracorporate com-
plaint fell within the scope of the whisue-blower provisions of the
* In addition, in Consolidated Edison Co. v. Donovan, 673 F. 2d 61 (2nd Cir.
1982), the Second Circuit affirmed a finding by the Secretary of Labor that an
employee was discharged for having reported safety violations under the ERA.
However, neither paly to thal action ever questioned whether internal complaints
are protected
ss In Phillips, the D.C. Circuit reasoned that, under the facts of the case, the
Fnillip
actof and employee “notifying” his supervisor of « dangerous condition, was an
“essenual” preliminary stage the process of filing or commencing a proceeding
under the general statute. Id. at 785. On that basis, the decision of the Third Circuit
is Clearly distinguishable.
10 Justice White, joined by Justices O'Connor and Blackmun, filed a dissenting
opinion on the denial of the peution for writ of certiorari, where the question
presented was identical to the issued presented here.
, |
12
~
Energy Reorganization Act, 42 U.S.C. § 5851(a) (“ERA”).!! The
Fifth Circuit predicated its conclusion on three considerations:
... first, the statutory language cannot be stretched
to encompass such filing. Second, the legislative
history of the [ERA] does not support such an
extension of the meaning of section 5851. Third,
the structure of the ERA indicates that section
5851(a) is designed solely to protect from retalia-
tion corporate “whistle blowers” who inform re-
sponsible officials of corporate failings. [747 F.2d
at 1031}.
These considerations apply equally as well to the employee
— protection provisions under the Clean Water Act.
Given the fact that the Fifth Circuit disagrees with at least three
other courts of appeal on whether the protection afforded employ-
ees via the federal whistle-blower provisions extends to intemal
complaints, this issue will continue to be contested, especially in
view Of the split in authority among the circuits. As it now stands,
nuclear projects and wastewater treatment facilities — and innu-
merable other facilities subject to regulation of various federal
environmental and safety statutes — operating within the jurisdic-
tion of the Fifth Circuit are governed by a radically different
statutory interpretation than such projects and facilities operating in
other jurisdictions. This presents obvious problems for the agencies
11 The whistle-blower provisions of the Clean Water Act mirror that of the several
other federal environmental, safety and evergy statutes including the Energy
Reorganization Act, 42 U.S.C. § 5851(a) (“ERA”). In particular, the employee
protection provisions of the Clean Water Act and the ERA were both patterned
after the whistle-blower provisions of the Federal Coal Mine Health and Safety Act
of 1969, Pub. L. No. 91-173 § 110(b) (1), 83 Stat. 742 (formerly codified at 30
U.S.C. § 820 (b) (1). S. Rep. No. 414. 92d Cong., 2d Sess. 83 (1971), reprinted in
1972 U.S.C.C.A.N. 3748; Senate Repori No. 848, U.S.C.C.A.N. 1978, p. 7303.
Because the present case was the first to present a Circuit Court with such an issue
under the Clean Water Act, the third Circuit relied upon the decisions arising under
the ERA and the Mine Safety Act to support its conclusion that intracorporate
complaints fall within the protective scope of the whistle-blower statutes. (Pet.
App. at 10a).
a
13
charged with enforcing whistle-blower statutes as well as for those
that must comply with these statues.
A. THE STATUTORY LANGUAGE OF THE
WHISTLE-BLOWER STATUTES CANNOT
BE STRETCHED TO ENCOMPASS
INTRACORPORATE COMPLAINTS.
On their face, the statutory language utilized in cach of the
environmental whistle-blower statutes clearly indicates that Con-
gress intended to protect employees that (a) have commenced or
filed, or caused to be commenced or filed, a proceeding under one
of the relevant statutes; or (b) has testified or participated, oris about
to testify or participate, in any such proceeding. The Fifth Circuit
found that the term “proceeding” refers to “a formal legal or
administrative proceeding as the term is used in section 5851” and
that “[a]bsent a clearly expressed legislative intention to the con-
trary,” courts are bound by the meaning an ordinary reader would
give to the statutory language. 747 F.2d at 1031-1032. In addition,
the Fifth Circuit reasoned that by expressly identifying the types of
activities which were protected by the whistle-blower provisions of
§ 5851 —Le., filing, commencing, or participating in a proceeding
— Congress purposely chose not to afford protection to a wide
spectrum of other activities including intracorporate filings and
complaints. Id, at 1032. The statutory language of these whistle-
blower provisions do not even suggest that Congress intended to
protect purely internal, intracorporate filings or complaints. This is
in despite of the fact that such protection could have been easily
extended had Congress so intended.
B. THE LEGISLATIVE HISTORIES OF THE
WHISTLE-BLOWER PROVISIONS SUPPORTS
THE CONCLUSION THAT INTERNAL FIL-
INGS ARE NOT PROTECTED.
In addition to the specific language of the statute, the Fifth
Circuit in Brown & Root found that the legislative history of the
federal whistle-blower provisions of § 5851(a)[which is identical
to the provisions under the Clean Water Act] does not support
14
protection of purely intemal and intracorporate filings and com-
plaints. The ERA and the Clean Water Act were both pattemed after
the employee protection provisions of the Federal Mine Health and
Safety Actof 1969, 30 U.S.C. 815(c)[1] (‘MSA”’). Both provisions
were specifically intended to provide protection to employees ...
‘for taking part or assisting in administrative or legal proceedings”
to enforce the requirements of general statutes. S.Rep. No. 414,
92nd Cong., 2d Sess. 83 (1971), reprinted in 1972 U.S.C C.A.N.
3748 (Clean Water Act); H.R.Rep. No. 1796, 95th Cong., 2d Sess.
16-17 (1978), U.S.C.C.A.N. 1978, pp. 7303, 7309 (ERA). More
importantly, however, the version of the MSA upon which the
Clean Water Act and ERA whistle-blower provisions were pat-
termed, was subsequently amended toexpressly protect anemployee’s
filing of intemal complaints. As the Court in Brown & Root
acknowledged, the ERA [and the Clean Water Act] have no such
express language and it may therefore be inferred that Congress
intended to deny protection to the filerof an intemal complaint. 747
F.2d at 1034.
The legislative history of the MSA amendments, which ex-
tended protection to internal complaints, indicates that Congress
intended to codify the judicial interpretation given 110 of the Coal
Act. see e.g. Phillips v. Intenor Board of Mine Operations Appeal,
500 F.2d 772 (D.C. Cir. 1978), cert. denied, 420 U.S. 938 (1975).
In Phillips, the Court, in construing the whistle-blower provisions
ofthe MSA before they were amended, reasoned that anemployee’s
notification to his employer of possible work place dangers “‘is an
essential preliminary stage,” or prerequisite, before that employee
would be permitted to make a complaint with the Secretary of Labor
or institute a “proceeding” under the general act. In other words, the
“procedure” employed by the defendant mining company for the
processing of safety complaints required that the complaining
employee begin by notifying his foreman of the safety problem. In
contrast, no such reporting or notification procedures have been
established by EPA or the PVSC for the processing of Clean Water
Act violations.
C. THE STRUCTURE OF THE CLEAN WATER
ACT INDICATES THAT § 507 IS DESIGNED
TO PROTECT “WHISTLE-BLOWERS” WHO
el
15
PROVIDEINFORMATION TOGOVERNMEN-
TAL ENTITIES, NOT TO THEIR EMPLOYER.
Finally, in holding that internal filings and complaints are not
protected under the whistle-blower provisions of the ERA, the Fifth
Circuit reasoned that “the structure of the ERA indicates that
section 5851 is designed to protect “whistle blowers” who provide
information to govemmmental entities, not to the employer corpora-
tion.” Id. at 1034-1035. Similarly, the structure of the Clean Water
Act indicates that § 507 is also designed to protect “whistle
blowers” who provide information to govemmental entities, and
not those who merely allege violations internally. The overall
purpose of the Clean Water Act is pollution prevention and the
maintenance of the national water supply. In that regard, the Clean
Water Act depends upon a number of powerful incentives to
achieve those goals. A Clean Water Act violator is subject to
criminal penalties, civil penalties and, in the case of a NPDES
permit holder, the denial, suspension or revocation of the nght to
discharge to the waters within the jurisdiction of the United States.
In an industry that is already heavily regulated by detailed and
comprehensive procedures, there is no reason to read into a statute
that which is not there.
Il. THE INTENDED SCOPE AND REACH OF
THE VARIOUS FEDERAL ENVIRONMEN-
TAL, SAFETY AND ENERGY WHISTLE-
BLOWER STATUTES IS A MATTER OF NA-
TIONAL IMPORTANCE WHICH SHOULD BE
RESOLVED BY THIS COURT.
Whether or not Congress intended to protect purely internal
filings and complaints is clearly a matter of national importance
which effects literally millions of employers and employees subject
to regulation under the Clean Water Act, and by reason of their
related purpose, a host of other federal statutes. While the protcc-
tion of employees who bring to light violations of the law is an
objective to be encouraged, there must be a balance between these
objectives and management’s need to effectively exercise its dis-
cretion over its employees. The Fifth Circuit was especially
ee
16
concemed that a broad construction of the whistle-blower provi-
sions — such as that asserted by the Secretary of Labor — would
radically alter the tradition employee-employer relationship.
In this regard we are troubled by the Secretary's
inability to confine ina principled way the logical
consequences of his proposed interpretation; these
consequences would seem to extend far beyond
the purpose and structure of the ERA. If, as the
Secretary maintains, all conduct of a qualified
control inspector believing he is helping to ensure
the safety of anuclear plant is protected by section
5851, then the same would appear to be true of all
engineers and architects who work on the design of
the plant. The Secretary’s reading of the statute
would appear to prohibit the discipline or dis-
charge of such people for any disagreement with
their employers on any matter which involved
plant safety. Moreover, thc same would appear to
be true for every employee. Since a wide range of
decisions in a nuclear company will have some
bearing on plant safety, the Secretary asks us to
adopt an interpretation that-would_radically re-
structure the employee-employer relationship in
all nuclear corporations on the basis of a general
“catch all’ provision attached to the end of a
statute. If the statutory languages were not cnough
to persuade us that the secretary’s interpretation is
incorrect, these limitless consequences would give
us pause. [Id at 1035].
The Third Circuit, on the other hand, commented that its all-
inclusive interpretation of § 507 of the Clean Water Act would not
compromise “‘the ability of management to exercise broad discre-
tion in the regulation of employer/employee relations.” (Pet. App.
at 16a). However, the Third Circuit’s interpretation would not only
radically alter the traditional employee-employer relationship, it
would actually discourage employees from reporting violations of
the law to appropnate enforcement agencies. For example, so long
ee eel
17
as Guttman believed that the PVSC was in violation of the Clean
Water Act, in accordance with the Third Circuit's reasoning, his
criticism of the PVSC’s user charge system was protected by § 507
even though that criticism persisted for a period of three years. Had
an enforcement agency, acting on a complaint by Guttman, issued
a determination that the PVSC’s user charge system complied with
the requirements of the Clean Water Act, Guttman would no longer
have the protection of §507 to continuc in his complaints regarding
the legality of that system. Thus, under the principle’s adopted by
the Third Circuit, § 507 offers less protection to employees or
‘“whistle-blowers”’ who report violations to competent enforcement
agencies than to those employees who fail to bring such viloations
to the attention of competent enforcement agencies.
The divergent approaches taken by the various courts of appeal
regarding the interpretation of the whistle-blower statutes can only
be resolved by definitive guidance from this Court. This case
presents an ideal vehicle to resolve this important issue since the
Statute here is patterned after a variety of similarly worded em-
ployee protection statutes.
18
CONCLUSION
For the foregoing reasons, the petition for certiorari should be
granted
Respectfully submitted,
Michael P. Ambrosio
Counsel of Record
Gabriel M. Ambrosio
Gabriel M. Ambrosio, Esqs.
464 Valley Brook Avenue
P.O. Box 911
Lyndhurst, New Jersey 07071
Tel. (201) 933-8844
Counsel for Petitioner
TABLE OF CONTENTS
Page
Passaic Valley Sewerage Commissioners v. United States Depanrt-
ment of Labor and Robert Reich, the Secretary of Labor, (No, 92-
3261) (Opinion of the United States Court of Appeal for the Third
Circuit dated April 16, 1993) o.oo cocccccccccscssseecseeeeec a-]
In the Matter of Joseph Guttman v. Passaic Valley Sewerage
Commissioners, (Case No. 85-WPC-2) (Decision of the Secretary
of Labor dated March 13,1991)... sallantaas Scot natieapacaaiicoes a-17
In the Matter of Joseph Guttman v. Passaic Valley Sewerage
Commissioners, (Case No. 85-WPC-2) (DecisionofJohnC. Holmes,
Administrative Law Judge, dated April 17, 1985)... a-33
Correspondence for United States Department of Labor, Wage and
Hour Division to Joseph Guttman dated January 7, 1985 ...... a-39
a-1
Filed April 16, 1993
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
No. 92-3261
PASSAIC VALLEY SEWERAGE COMMISSIONERS
Petitioner
Vv.
UNITED STATES DEPARTMENT OF LABOR
and ROBERT REICH.
THE SECRETARY OF LABOR
Respondents
On Petition for Review of a Final Order from
the United States Department of Labor
(0090-1: 85-WPC-2)
Argued
January 7. 1993
Before: MANSMANN and NYGAARD. Circuit Judges, and
DALZELL, District Judge.*
(Filed: April 16, 1993)
*Honorable Stewart Dalzell of the United States District Court for the
Eastern District of Pennsylvania. sitting by designation.
a-2
OPINION OF THE COURT
Gabriel M. Ambrosio, Esquire
(ARGUED)
Law Office of Gabriel M. Ambrosio
464 Valley Brook Avenue
P.O. Box 911
Lyndhurst, NJ 07071
Counsel for Petitioner
Marshall J. Breger
Solicitor of Labor
Allen H. Feidman
Associate Solicitor for
Special Appellate and
Supreme Court Litigation
Steven J. Mandel
Deputy Associate Solicitor
William J. Stone, Esquire
Ellen L. Beard, Esquire (ARGUED)
Paul L. Frieden, Esquire
U.S. Department of Labor
Room N-2700
200 Constitution Avenue, N.W.
Washington, DC 20210
Counsel for Respondents
MANSMANN, Circuit Judge.
The Passaic Valley Sewerage Commissioners petition for
a review of a Final Order of the Secretary of Labor’ which
set aside a Recommended Decision and Order of the
Administrative Law Judge, and held the PVSC liable in
equity and for damages for the wrongful discharge of an
employee under the Federal Water Pollution Control Act's
“whistle-blower” employee protection provision.
1. At the time the Final Order of the Secretary of Labor was issued Lynn
Martin served as the Secretary of Labor. We have changed the caption to
reflect automatic substitution of the named public officer pursuant to
Fed. R. App. P. 43(c).
—— -
a-3
The primary issues before us are whether the employee's
activity, which consisted of his repeated intracorporate
complaints regarding the PVSC'’s operating practices, is
protected under the whistle-blower provision, and if so,
whether his employment termination was in retaliation for
his pattern of complaints so as to implicate the PVSC under
that statute. We hold that the administrative interpretation
of the statute as being protective of this employee's
intracorporate complaints comports with the _ broad
remedial purpose of the statute and is hence permissible.
Because the Secretary's finding of retaliatory employment
termination is supported by substantial evidence. we will
affirm the Secretary's remedial orders.
The Passaic Valley Sewerage Commissioners, a corporate
and political organization under New Jersey state law,’
successfully operate a modern secondary sewage treatment
plant. Federal appropriations pursuant to an
Environmental Protection Agency allotment under § 202 of
the Federal Water Pollution Control Act, 33 U.S.C. § 1251 et
seq. (commonly known as the Clean Water Act).‘ provided
75% of the plant’s construction costs, bringing the PVSC
operations under the Clean Water Act regulations -which
condition federal funding.
The Clean Water Act requires recipients of federal funds
to adopt a system of billing or customer user charges which
“assure(s] that each recipient of waste treatment services
within the applicant's Jurisdiction ... will pay its
proportionate share . . . of the costs of operation and
maintenance (including replacement) of any waste
treatment services provided by the applicant.” 33 U.S.C.
§ 1284(b)(1)(A). In compliance with this requirement. the
2.N.J.S.A. 58:14-1 et seq.
3.A secondary treatment plant removes over 90% of pollutants from
waste material. whereas a primary treatment facility removes 10 to 15%
of pollutants. Brief of PVSC at p.5. n.*.
4. This Act authorizes the EPA to make federal grants to state and local
governmental agencies to fund construction of publicly owned waste
treatment plants. 33 U.S.C. § 1281-1299.
a-4
PVSC instituted an ad valorem user charge system.°
purportedly approved by the EPA after numerous public
hearings, whereby the PVSC charged users on the basis of
the volume of waste water discharged to the system and the
concentration of dissolved and undissolved solids to be
treated. 40 C.F.R. §35.929-1(a). The PVSC implements its
user charge system via customer self-monitoring, which
requires that each industrial user sample, monitor and
report on its waste water discharges to the PVSC Treatment
Works, subject to the PVSC’s periodic compliance checks.
The self-monitoring process requires that in addition to its
regular sampling procedure, industrial users prepare a
daily split sample, making one sample available to the
PVSC to collect and perform its own evaluation of the
accuracy of the self-monitored data.
In August of 1981, Joseph Guttman, the PVSC’s Chief of
Laboratory and Stream Pollution Control, became highly
critical of the split-sampling procedure. He remained
critical of the procedure for the duration of his tenure at
the PVSC. The gist of Guttman’s complaints was that the
system was allegedly inordinately expensive, inefficient.
scientifically unreliable and in violation of the Clean Water
Act user charge provisions. His initial written complaint
was conveyed in a memorandum to his superior, the
PVSC’s Chief Engineer Ricci. and included a
recommendation for increased PVSC oversight of sample
preparation. The following year Guttman repeated his
complaints in writing to the Chief of Industrial Waste
D’Ascensio. Again that year. Guttman wrote to Executive
Director Perrapato expressing his dissatisfaction and
requesting an increased supervisory role for himself.
Perrapato apprised all of the individual PVS commissioners
of Guttman’s concerns, and obtained, from in-house legal
counsel, recommendations on the issues Guttman raised.
When counsel assured the PVSC that full compliance with
the Clean Water Act was maintained, the PVSC considered
5.PVSC’s ad valorem user charge system was developed by PVSC
personnel, including Chief Engineer Rocco Ricci, Chief of Industrial
Waste Frank D’Ascensio, Chief Financial Officer Vincent Gialorenzo, and
Assistant Counsel Gabriel Ambrosio, in conjunction with the accounting
firm of Arthur Young & Company.
a-5
the matter closed. With the commissioners’ approval,
Perrapato assigned D’Ascensio to supervise Guttman.
The working relationship between Guttman and
D’Ascensio was. from the start, extremely volatile and their
mutual antipathy became exacerbated when Guttman
began unilaterally to discard large numbers of split samples
collected by the PVSC. While Guttman insisted that
allegedly poor or unreliable quality and an harassingly
excessive quantity of these samples justified this practice,
D'Ascensio characterized the practice as a_ deliberate
attempt to sabotage the user charge system. prompting
D’Ascensio to prepare a highly critical evaluation of
Guttman’s performance, which implied the possibility of
imminent negative impact on Guttman’s employment. In
the ensuing weeks. Guttman prepared a memorandum
which he circulated to all the PVS commissioners, generally
alleging Clean Water Act violations against the PVSC’s user
charge verification system. In response to in-house
counsel's request for greater legal and factual specificity in
the allegations, Guttman issued a second memorandum
citing “204(b)(1)(A)” [33 U.S.C. § 1284(b)(1)(A)] of the Clean
Water Act.
Although in-house counsel rebutted each of Guttman’s
allegations, the PVSC afforded Guttman the opportunity to
brief the panel of commissioners. On the basis of that
hearing and on the advice of in-house caqunsel. the
commissioners found Guttman’s claims to be without merit.
In the course of the hearing, Guttman stated that in a
telephone discussion with Ambrosio. the PVSC in-house
counsel, Guttman threatened to report his claim directly to
the EPA. Ambrosio did not recollect this alleged threat and
testified that. under the circumstances, he would not have
taken the alleged threat seriously had it occurred.
Upon these occurrences and a determination that
Guttman’s behavior jeopardized the PVSC’s credibility with
its customers, D’Ascensio recommended termination of
Guttman’s employment. Perrapato immediately assigned
Personnel Managers Santamassino and Borgatti to mediate
the dispute between Guttman and _ D’Ascensio.
Approximately six months later. pursuant to
Santamassino’s recommendation which Perrapato
ee
a-6
transmitted to the commissioners, the PVSC eliminated
Guttman’s position of Chief of Laboratory as no longer
necessary after a corporate reorganization in which four
departments were collapsed into three. Guttman became
the only Chief terminated, effective November 10, 1984. The
termination decision was purportedly made strictly upon
the fiscal needs of the PVSC and Guttman’s lack of
seniority, and “hald] nothing to do with individual
personalities.” Perrapato Memorandum dated September 6,
1984.
Although there is evidence which supports the proffered
reason for Guttman’s employment termination, there is
substantial evidence that indeed Guttman’s apparent lack
of interpersonal skills contributed to his selection for
employment termination. Of most specific concern to us is
whether Guttman’s layoff was a retaliatory measure, as
Guttman claims, aimed at punishing protected but
disruptive activity under § 507 of the Clean Water Act, the
Act's provision’ protecting “whistle-blowers.” The
Administrative Law Judge® recommended denying
Guttman’s claim on the basis that his complaints were
“internal” with but one allegation that Guttman threatened
to communicate directly with the EPA. The Administrative
Law Judge reasoned that internal complaints are not
protected activity under the whistle-blower statute, and
concluded that there was no cause and effect nexus
between Guttman’s alleged threat to take his claim to the
EPA and his subsequent employment termination. Noting
that “even assuming. arguendo, that the Commissioners
knew or suspected that Claimant had any intention of
taking his views public, an elegant sufficiency of time had
passed during which Claimant had taken no action
whatsoever so as to indicate any threat was empty and
6.Under the regulations which provide for the procedural
implementation of the whistle-blower statute. the Department of Labor's
Wages and Hour Division conducts the initial investigations pursuant to
the filing of an employee complaint, and the Department's Office of
Administrative Law Judges holds related hearings. 29 C.F.R. §§ 24.3,
24.4, 24.5. The Secretary of Labor reviews the recommendations of the
ALJ, and then issues his or her own final decision and order. 29 C.F.R.
§ 24.6.
a-7
inconsequential.” Recommended Decision and Order
Denying Claim, April 17, 1985. The Administrative Law
Judge found that the termination was squarely within the
employer's discretion in managing employee relationships,
and was not in retaliation for Guttman’s complaints of
alleged violations of the Clean Water Act.
On March 13, 1992, seven years after the Administrative
Law Judge issued the Recommended Decision and Order
denying plaintiffs claim, the Secretary of Labor reversed
that dismissal in a Final Decision and Order. concluding
that the PVSC had violated the employee protection
provision of the Clean Water Act. and awarding
reinstatement, backpay and benefits with interest.’
We must decide whether the Secretary of Labor's
conclusion that Guttman’s intracorporate complaints have
protected status under §507(a) of the Clean Water Act is
reasonable, and if so, whether there is substantial evidence
to support the Secretary's findings that Guttman was
discharged in violation of that whistle-blower provision. We
assume Jurisdiction pursuant to 33 U.S.C. §§ 1367(b) and
1369(b).
We exercise plenary review over legal questions
concerning the construction of statutes which an agency
administers where Congress has unambiguously addressed
the question at issue. Federal Administrative Procedures
Act, 5 U.S.C. §§ 704, 706 Here. however, we find the facial
language of the Clean Water Act's whistle-blower protection
provision to admit of more than one interpretation, and
7. Section 24 of Volume 29 of the Code of Federal Regulations sets out
the “procedures for the handling of discrimination complaints under
federal employee protection statutes.” 29 C.F.R. § 24.1 et seq. Section
24.6(b)(1) provides that “within ninety (90) days after receipt of a
complaint. the Secretary of Labor shail issue a final order .. .-” Here, the
Secretary issued a final order years after the 90-day time frame. The
parties did not initiate an action to compel the Secretary to issue Its
decision. however, and no allegation of prejudice from the delay ts
asserted. See Roadway Express, Inc. v. Dole. 929 F.2d 1060. 1066-67
(Sth Cir. 1991) (failure to comply with regulatory time limits does not
result in loss of jurisdiction unless statute expressly requires timely
action and states a consequence for failing to comply).
aneeadareemeniie lle
a-8
hence we are compelled to uphold the Secretary's
interpretation if it is “based on a permissible construction
of the statute.” Chevron USA, Inc. v. Natural Resources
Defense Council, Inc., 467 U.S. 837, 843 (1984). The
Secretary's conclusion from the facts, if reasonable and
supported by substantial evidence, will likewise be upheld
in accordance with the Federal Administrative Procedures
Act. 5 U.S.C. § 706(2)(E). We turn first to the legal question
of whether an employee who makes intracorporate
complaints is protected under the Clean Water Act's
whistle-blower provision.
Il.
Section 507(a) of the Clean Water Act provides that:
No person shall fire, or in an other way discriminate
against ... any employee . . . by reason of the fact that
such employee ... has filed, instituted, or caused to be
filed or instituted any proceeding under this chapter,
or has testified or is about to testify in any proceeding
resulting from the administration or enforcement of the
{Clean Water Act].
33 U.S.C. § 1367{(a).
Such “whistle-blower” provisions are intended to promote
a working environment in which employees are relatively
free from the debilitating threat of employment reprisals for
publicly asserting company violations of statutes protecting
the environment, such as the Clean Water Act and nuclear
safety statutes. They are Intended to encourage employees
to aid in the enforcement of these statutes by raising
substantiated claims through protected procedural
channels. The parties are in agreement here that
complaints registered with a competent enforcement organ
of government, external to the federal fund recipient, in
order to initiate a formal proceeding, are covered by this
provision. The specific question before us is whether
Guttman’s intracorporate complaints, including his
— and testimony before the PVSC, are also
covered.
The statutory term “proceeding” within § 507(a) of the
Clean Water Act is ambiguous. The term may reasonably be
a-9
invoked to encompass a range of complaint activity of
varying degrees of formal legal status. The Secretary held
that an employee's exclusively intracorporate complaint
reporting is an activity fully protected under the terms of
the provision. The Secretary further held that whether the
employee was profoundly misguided or insufficiently
informed in his assessment of the PVSC’s user charge
system was Irrelevant, and that the Administrative Law
Judge had erred as a matter of law in excluding ill-formed
complaints from protection. Fina! Decision and Order of the
Secretary, dated March 13. 1992.
We believe that the statute’s purpose and legislative
history allow, and even necessitate, extension of the term
“proceeding” to intracorporate complaints. The whistle-
blower provision was enacted for the broad remedial
purpose of shielding employees from retaliatory actions
taken against them by management to discourage or to
punish employee efforts to bring the corporation into
compliance with the Clean Water Act's safety and quality
Standards. If the regulatory scheme is to effectuate its
substantive goals. employees must be free from threats to
their job security in retaliation for their good faith
assertions of corporate violations of the statute. Section
507(a)'s protection would be largely hollow if it were
restricted to the point of filing a formal complaint with the
appropriate external law enforcement agency. Employees
should not be discouraged from the normal route of
pursuing internal remedies before going public with their
good faith allegations. Indeed. it is most appropriate, both
in terms of efficiency and economics, as well as congenial
with inherent corporate structure. that employees notify
management of their observations as to the corporation's
failures before formal Investigations and litigation are
initiated. so as to facilitate prompt voluntary remediation
and compliance with the Clean Water Act. Where perceived
corporate oversights are a matter of employee
misunderstanding, this would afford management the
opportunity to Justify or clarify its policies. See Sullivan v.
Massachusetts Mut. Life Ins. Co., 802 F. Supp. 716, 725 (D.
Conn. 1992). Moreover. an employee's non-frivolous
complaint should not have to be guaranteed to withstand
the scrutiny of in-house or external review in order to merit
a-10
protection under § 507(a) for the obvious reason that such
a standard would chill employee initiatives in bringing to
light perceived discrepancies in the workings of their
agency.
Furthermore, the whistle-blower provision of the Clean
Water Act mirrors that of several other federal
environmental, safety and energy statutes.® The legislative
history of § 507 indicates that it was patterned after some
of these provisions. S. Rep. No. 414, 92d Cong., 2d Sess. 83
(1971), reprinted in 1972 U.S.C.C.A.N. 3748. Construing
such a whistle-blower statute, the Supreme Court has
afforded broad protection to employees, noting that broad
protection is necessary “ ‘to prevent the Board’s channels of
information from being dried up by employer intimidation
of prospective complainants and witnesses.’” NLRB ov.
Scrivener, 405 U.S. 117, 122-23 (1972) (citing John
Hancock Mut. Life Ins. Co. v. NLRB, 191 F.2d 483, 485 (D.C.
Cir. 1951)) (“testimony” under the National Labor Relations
Act’s whistle-blower provision includes sworn statement of
employee to investigator which was not later used at formal
hearing).
8. See, eg.. 42 U.S.C. §7622 (Clean Air Act): 42 U.S.C. §9610
(Comprehensive Environmental Response, Compensation, and Liability
Act); 42 U.S.C. § 300())-9(i) (Safe Drinking Water Act); 42 U.S.C. § 6971
(Resource Conservation and Recovery Act): 15 U.S.C. §2622 (Toxic
Substances Control Act); 42 U.S.C. §5851 (Energy Reorganization Act);
30 U.S.C. § 815(c)(1) (Federal Mine Safety and Health Act); 29 U.S.C.
§ 158{a)(4) (National Labor Relations Act); 45 U.S.C. §441(a) (Federal
.__ Railroad Safety Authorization Act).
The Senate Report on the Energy Reorganization Act's whistle-blower
provision, for example, states:
This amendment is substantially identical to provisions in the Clean
Air Act and the Federal Water Pollution Control Act. The legislative
history of those acts indicated that such provisions were patterned
after the National Labor Management Act and a similar provision in
Public Law 91-173 [Federal Mining Safety Act] relating to the health
and safety of the Nation's coal miners.
S. Rep. No. 848, 95th Cong.. 2d Sess. at 29 reprinted in 1978
U.S.C.C.A.N. at 7303.
cae eceaeieaneiaimiiiiil
a-1]
Similarly, our sister courts of appeals have consistently
construed those statutes to lend broad protective coverage
to internal complainants, as well as other employees. See,
e.g.. Mackowiak v. University Nuclear Systems, Inc., 735
F.2d 1159, 1163 (9th Cir. 1984) (internal safety and quality
control complaints protected under Energy Reorganization
Act of 1974); NLRB v. Retail Store Employees Union, 570
F.2d 586 (6th Cir.), cert. denied, 439 U.S. 819 (1978)
(employee who refused to testify in support of union
protected under the National Labor Relations Act): Phillips
v. Interior Board of Mine Operations Appeals, 500 F.2d 772,
779 (D.C. Cir. 1974), cert. denied, 420 U.S. 938 (1975) (coal
miner's “notification to the foreman of possible dangers”
protected activity under Federal Coal Mine Health and
Safety Act of 1969); Kansas Gas & Elec. Co. v. Brock, 780
F.2d 1505, 1510-12 (10th Cir. 1985), cert. denied, 478 U.S.
1011 (1986) (protection under Energy Reorganization Act's
whistle-blower provision); Consolidated Edison Co. v.
Donovan, 673 F.2d 61 (2d Cir. 1982) (Energy
Reorganization Act); Rayner v. Smirl, 873 F.2d 60, 64 (4th
Cir.), cert. denied, 493 U.S. 876 (1989) (Federal Railroad
Safety Act); Pogue v. United States Dept. of Labor, 940 F.2d
1287, 1289 (9th Cir. 1991) (whistle-blower provisions of
four separate environmental statutes): Love v. RE/MAX of
America, Inc., 738 F.2d 383, 387 (10th Cir. 1984) (Fair
Labor Standards Act); but see Brown & Root, Inc v.
Donovan, 747 F.2d 1029 (5th Cir. 1984) _ (internal
complaints are not protected by whistle-blower provision of
the Energy Reorganization Act).’ Although the present case
9. The whistle-blower provision at issue in Brown & Root, Inc., § 210(a) of
the Energy Reorganization Act, 42 U.S.C. § 5851(a). provides that:
No employer . . . may discharge any employee . . . because the
employee ... —
(1) commenced . . . a proceeding under this chapter of the Atomic
Energy Act of 1954... or... for the administration or enforcement
of any requirement imposed under this chapter .. .;
(2) testified . . . in any such proceeding or:
(3) assisted or participated . . . in such a proceeding . . . or in any
other action to carry out the purposes of this chapter. . . .
The court of appeals interpreted this section as solely protecting from
retaliation “corporate ‘whistle blowers’ who inform responsible officials of
anita le
a
a-12
is the first to present us with this issue in the context of
the Clean Water Act, the weight of other circults’ precedent
reviewing analogous statutes concurs with the Secretary's
own broad inclusion of intracorporate complaints within the
protective scope of the statute.
We hold that the Secretary's interpretation of the statute
gives effect to the Intent of Congress. The statute's
legislative intent, supported by _ federal decisions,
reasonably permits a broad interpretation of the term
“proceeding” within § 507(a) of the Clean Water Act to
include intracorporate complaints. Under Chevron, 467 U.S.
837, 842-43 (1984). we will defer to the Secretary's
reasonably permissible construction. The Secretary's
holding that all good faith intracorporate allegations are
fully protected from retaliation under §507(a) will be
affirmed.
Because the Secretary was reasonable in concluding that
intracorporate complaints are protected under the statute.
our opinion does not turn on whatever Guttman’s alleged
one time threat to pursue his complaint directly with the
EPA adds to the weight of the evidence. See Recommended
Decision and Order of the Administrative Law Judge at 2.
corporate failings.” and did not extend protection to employees who file
“purely internal quality control reports.” 747 F.2d at 1031. The court
reasoned that the statutory language of the whistle-blower provision,
taken in isolation as well as in the context of the other provisions of the
Energy Reorganization Act, did not provide a basis for construing the
terms “proceeding” or “action” broadly enough to encompass internal
complaints.
The court noted that the Secretary did not argue that filing internal
quality control reports constituted initiation of a “proceeding.” which, the
court remarked, connotes a formal legal or administrative act, but
rather, the Secretary argued that the internal filings represented the
“other action” protected under § 5851(a). The court was not persuaded
by the Secretary's argument. Brown & Root, Inc.. 747 F. 2d at 1031-32.
As a policy matter. the court was concerned that a_ broad
interpretation of the statutory terms would defy containment and would
logically extend the Department of Labor's oversight into the
discretionary domain of corporate management in the mediation of
employer /employee relations.
a-13
Nor does our opinion turn on whether Guttman’'s testimony
before the PVSC qualifies as an external formal
“proceeding” within the meaning of the Clean Water Act on
the basis that the PVSC is a competent organ of
government to process environmental complaints pursuant
to New Jersey law. N.J. Stat. Ann. §§58:14-7: 58:14-8:
58:14-35. See Brief for the Secretary of Labor at 29-30.
Guttman’s internal complaints fall within the protective
scope of §507(a), and the only remaining question is
whether there is substantial evidence in the record to
Support the Secretary's finding of retaliatory discharge.
il.
Section 706 of the Administrative Procedure Act requires
a court to set aside an agency decision which is not
supported by substantial evidence. 5 U.S.C. § 706(2)(E).
“Substantial evidence” is “‘such relevant evidence as a
reasonable mind might accept as adequate to support a
conclusion.’” Richardson v. Perales, 402 U.S. 389, 401
(1971) (quoting Consolidated Edison Co. v. NLRB, 305 U.S.
197, 229 (1938)). Substantial evidence is “more than a
mere scintilla,” id., but “less than the weight of the
evidence,” Consolo v. Federal Maritime Com., 383 U.S. 607,
619-20 (1966). See also Broome v. United States Dept. of
Labor, 870 F.2d 95, 102 (3d Cir. 1989). ;
Guttman’s evidentiary burden to demonstrate a prima
facie case of retaliatory discharge under § 507(a) consists in
his showing that (1) the plaintiff was an employee of the
party charged with discrimination: (2) the plaintiff was
engaged in a protected activity under the Clean Water Act;
(3) the employer took an adverse action against the
plaintiff; and (4) the evidence created a reasonable inference
that the adverse action was taken because of the plaintiff's
participation in the statutorily protected activity. See Couty
v. Dole, 886 F.2d 147, 148 (8th Cir. 1989) (Energy
Reorganization Act); Lockert, 867 F.2d at 519 (Energy
Reorganization Act and National Labor Relations Act); De
Ford v. Secretary of Labor, 700 F.2d 281, 286 (6th Cir.
1983) (Energy Reorganization Act).
The first and third elements are undisputed. We have
resolved the second element in favor of Guttman in this
ei
|
a-14
opinion, leaving only the question of a sufficient nexus
between the PVSC's adverse action and Guttman’s pattern
of internal complaints. Even if the evidence raises a
reasonable inference of retaliatory discharge. the PVSC may
rebut the inference by proving a_ legitimate, non-
discriminatory. non-pretextual reason for its action. Where
evidence of “dual motive” exists, i.e., where reasons other
than retaliation may also account for the employee's
termination with his employer, the employer has the
burden to prove by a preponderance of the evidence that it
would have terminated the employee even if the employee
had not engaged in the protected conduct. Mt. Healthy City
School Dist. Bd. of Education v. Doyle, 429 U.S. 274, 287
(1977); Mackowiak, 735 F.2d at 1163-64; Consolidated
Edison, 673 F.2d at 62-63.
The Secretary determined that Guttman was engaged in
protected activity, that such activity was the direct cause of
his employment termination, and that the PVSC’s proffered
rebuttal was merely a pretext for the unlawful discharge.
Final Decision and Order of the Secretary.
We hold that substantial evidence supports the
Secretary's finding that Guttman’s complaint activity
directly prompted the PVSC to terminate his employment,
and was the dominant reason for the PVSC’s employment
decision even though other alleged reasons, such as
corporate economy of resources and Guttman’s alleged
incompetence, may have also played a role. The record
indicates that management believed that Guttman’s activity
jeopardized the entire user charge system and compromised
the PVSC’s customer credibility. Guttman’s memorandum
of March, 1984, alleging Clean Water Act violations, did
precipitate adverse action by the PVSC, namely a
recommendation that Guttman be terminated. The
corporate reorganization which eliminated Guttman’s office
was recommended in writing in September of that same
year, only six months after Guttman’s March memo, and
only four months after Guttman’s testimony before the
PVSC in May. Furthermore, Ambrosio testified under oath
that Guttman’s complaints “probably had a connection” to
his subsequent layoff. Although it is possible to weigh the
facts of record differently, we are bound by our standard of
a-15
review. A reasonable mind might very well accept as
adequate the evidence on record to support the Secretary's
conclusion. Richardson, 402 U.S. at 401. There is certainly
more than a scintilla of evidence supporting Guttman’s
claim.
The Secretary found that the “reorganization
recommendation had at least something, if not everything,
to do with Complainant's personality. which was principally
manifested by his highly vocal and unylelding objections to
Respondent's user charge system.” Final Decision and
Order of the Secretary, dated March 13, 1992, at 17. The
Secretary's finding, that the PVSC’s proffered fiscal reasons
and poor job performance to account for Guttman’'s layoff
were insufficient to meet the PVSC’s burden of production
to rebut Guttman’s prima facie case, comports with a
reasonable interpretation of the factual evidence in this
case. We have reviewed this evidence and conclude that it
permits the conclusion that any alleged “personality”
problem or deficiency of interpersonal skills was reducible
in essence to the problem of the inconvenience Guttman
caused by his pattern of complaints. There is no evidence
before us that Guttman’s alleged personality or professional
deficiencies arose in any other context outside of his
complaint activity.
With regard to evidence of dual motive, the Secretary
correctly noted that under this theory, it ts the employer's
motivation which is under scrutiny. The PVSC’s evidence
fails to separate its legitimate rationale from its prohibited
rationale in its termination of Guttman, and thus does not
prove its decision would have been the same absent.
Guttman’s history of complaints. It is not enough that the
evidence proved that the PVSC could have in retrospect
made its employment decision on legitimate grounds. As
already noted, the only context in which the PVSC has cited
Guttman as inadequate has been related to his complaints
regarding the user charge system. The risk that the illegal
and legal motives behind employee termination merge and
become inseparable is placed on the employer. NLRB ov.
Transportation Management Corp., 462 U.S. 393 (1983);
Mackowiak, 735 F.2d at 1164. Because the Secretary
reasonably concluded on the basis of the substantial
a-16
evidence that the PVSC had not proved a preemptive
legitimate reason for discharging Guttman. we hold that the
PVSC is not relieved from liability under the theory of dual
motive.
We do not believe that our holding here compromises the
ability of management to exercise broad discretion in the
regulation of employer/employee relations. The whistle-
blower statute is sufficiently framed so as to target precisely
the identified harmful activity without substantial threat to
management's reasonable latitude !n employment decisions.
The substantial evidence here supports the Secretary's
findings that Guttman’s discharge violated the whistle-
blower provision of the Clean Water Act.
IV.
For the foregoing reasons, we will affirm the Final
Decision and Order of the Secretary of Labor dated March
13, 1992, reinstating Guttman and awarding back pay.
including the benefits and interest to which Guttman is
entitled pursuant to that Order.
A True Copy:
Teste:
Clerk of the United States Court of Appeals
for the Third Circuit
a-17
U.S.DEPARTMENT OF LABOR
SECRETARY OF LABOR
WASHINGTON, D.C.
DATE: March 13, 1992
CASE NO. 85-WPC-2
IN THE MATTER OF
JOSEPH GUTTMAN,
COMPLAINANT,
V.
PASSAIC VALLEY SEWERAGE
COMMISSIONERS,
RESPONDENT. !
BEFORE: THE SECRETARY OF LABOR
FINAL DECISION AND ORDER
Before me for review is the Recommended Decision and Order
Denying Claim (R.D. and O.) of Administrative Law Judge (ALJ)
John C. Holmes in this case which arises under the employee
protection provision of the Federal Water Pollution Control Act (the
FWPCA), 33 U.S.C. § 1367 (1988). The ALJ denied relief on the
ground that Complainant failed to establish protected activity under
the FWPCA, or that any alleged protected activity was the likely
reason for his termination by Respondent. On review, Complainant
contends that his termination was discriminatory under the
whistleblower statute and that, in any event, the hearing below
violated procedural due process. Because I find that Complainant
was engaged in protected activity which likely caused his termina-
1 The administrative law judge’ s designation of thecaptioned parties as “Claimant”
and “Employer” is hereby modified to “Complainant” and “Respondent.” 29
C.F.R. § 24.4 (1990).
a-18
tion, and that Respondent's proffered reason for terminating Com-
plainant is pretextual, relief will be granted.
INTRODUCTION
l. FE Backgroun
Respondent (also herein referred to as P.V.S.C.) operates one
of the largest water treatment facilities in the nation, having been
upgraded to a secondary treatment plant in the early 1980's at a cost
of approximately $500 million.2 Seventy-five percent of plant
construction costs were paid through federal appropriations under
section 202 of the FWPCA, 33 U.S.C. § 1282. Complainant was
hired by P.V.S.C., effective March 31, 1980, as Chief of Laboratory
and Stream Pollution Control. T. 18.
The FWPCA requires, as a condition of federal funding, that
applicants adopt a system of billing, or user charges, to assure that
each recipient of waste treatment services pays it proportionate
share of the costs of operation and maintenance of the waste
treatment services. 33 U.S.C. § 1284 (B) (1) (A). To comply with
this requirement, P.V.S.C., principally through its Chief Engineer,
Mr. Ricci, its Chief of Industrial Waste, Mr. D’Ascensio, and its
Assistant General Counsel, Mr. Ambrosio, and the accounting firm
of Arthur Young & Company, designed an ad valorem user charge
system. T. 353-354, 446-447. Under this system, purportedly
approved by EPA and subjected to public hearings, users were to
pay in proportion to both the volume of water and concentration of
dissolved and undissolved solids to be treated. T. 272-273, 355. As
part of its system, P.V.S.C. elected to implement a self-monitoring
user charge system, instead of a treatment plant monitored system.
T. 358. Thus, each industrial user would monitor its own treatment
input, with the treatment plant performing compliance checks of
such monitoring. T. 359.
A significant component of the self-monitoring system was
Respondent’s split sampling requirement, whereby 98 percent of all
industrial users (about 75 companies) would take daily splitsamples,
2 As a secondary treatment plant over 90 percent of pollutants are removed,
whereas formerly, as a primary treatment facility, only 10-15 percent of pollutants
were removed. Hearing Transcript (T.) 261.
a
a-19
one sample for the user to analyze and the other for P.V.S.C. to
analyze. T. 361. If P.V.S.C. obtained a different analysis from the
industrial user, this would operate as a trigger to scrutinize that
user’s service more closely.
Beginning in August 1981, Complainant, as head of the labo-
ratory, in a memorandum to the Chief Engineer, criticized the split
sample concept because the lab was being flooded with samples
which Complainant contended were unreliable because taken by
the users and not by Respondent’s own inspectors. Complainant
Ex.(CX), App. A-2. Complainant recommended that Respondent’s
inspectors take the sample, which could then be split, on a yearly,
rather than daily, basis. Id. The Chief Engineer, who was
Complainant’s superior, did not act on Complainant’s suggestion
and left P.V.S.C. in the fall of 1982. By that time Complainant also
had written to the Chief of Industrial Waste, Mr. D’ Ascensio, that
the split sampling method of monitoring was unreliable and cost
excessive by reason of the excessive number of samples to be
analyzed. Memo of July 12, 1982, CX, App. A-4, Attach. #1.
After the Chief Engineer left, Complainant wrote to the Execu-
tive Director, Mr. Perrapato, requesting increased responsibilities
for himself, and referring to the self-monitoring user charge system
as a mistake which potentially could have legal and political
repercussions. Memo of November 23, 1982, CX, App. A-3. Mr.
Perrapato was assured by in-house counsel, Mr. Amrosio, that the
user charge system was legal, and this opinion, along with
Complainant’s memorandum, was relayed to the highest level, the
Commissioners. T. 274. Around this time the Executive Director,
with approval of the Commissioners, appointed Mr. D’ Ascensio to
oversee the laboratory and supervise Complainant. T. 284-285.
The record shows Complainant’s and Mr. D’ Ascensio’s work-
ing relationship was extremely volatile, that they disagreed strongly
over the user charge system, and did not generally communicate
productively with each other in any respect. T. 368-370. Mr.
D’Ascensio prepared a performance evaluation of Complainant on
February 28, 1984, which was highly critical of Complainant’s job
performance and described the situation as “serious.” Respondent’s
Exhibit (RX) 3. Shortly thereafter, by memorandum of March 23,
1984, to Mr. D’Ascensio (March 23 Memorandum), Complainant
alleged that Respondent’s user charge verification system violated
a-20
the Clean Water Act? and could not withstand a legal challenge.
CX, App. A-3.
Respondent’s in-house counsel, Mr. Ambrosio, responded to
Complainant’s March 23 Memorandum by amemorandum of April
2, 1984, asking Complainant to identify what statutory provisions
the user charge system violated and otherwise to explain its legal
defects. CX, App. A-5. Complainant responded by memorandum
of April 12, 1984, that section 204(b) (1) (A) of the Clean Water Act
[33 U.S.C. § 1284 (b) (1) (A)] was violated because the user charge
system in place did not assure proportionate cost sharing by system
users. CX, App. A-6. Mr. D’ Ascensio responded to Complainant’s
March 23 Memorandum at length in amemorandum dated April 19,
1984. RX 4. Sometime in April 1984, Complainant tried unsuc-
cessfully to force his way into a Commissioner’s meeting to explain
his views on the user charge system. T. 282. Complainant was then
scheduled to brief the Commissioners on May 15, 1984, at which
time he presented his views of the user charge system. T. 286; RX
6 (Minutes of Meeting).
Immediately after the Complainant’s March 23 Memorandum,
Mr. D’Ascensio recommended to the Executive Director that
Complainant be terminated. T. 423. Mr. D’Ascensio testified that
he was afraid the user charge system was being jeopardized by
Complainant, T. 422, who would not cooperate on defining what
level of difference between company and industrial analyses was
acceptable, who was rejecting as unacceptable a suspiciously large
number of samples and who might otherwise undermine the integ-
rity and credibility of the system through his resistance to it. T. 426-
431. The Executive Director did not terminate Complainant at that
time but assigned the Personnel Manager, Mr. Santamassino, to
take over supervising Complainant and mediating the difficulties
between Complainant and Mr. D’ Ascensio.
Some six months later, just prior to leaving P.V.S.C., Mr.
Santamassino recommended to the Executive Director a reorgani-
zation in which several departments, including the laboratory,
would be combined under one head. All the departments would
retain a chief, except the laboratory where the position of chief
would be eliminated. T. 287. By memorandum of September 6,
1984, the Executive Director recommended to the Commissioners
3 That is, the Federal Water Pollution Control Act.
that the position of Chief of Laboratory was unnecessary, based
strictly on the needs of the company “and has nothing to do with
individual personalities.” RX 2. The Executive Director testified
that elimination of Complainant’s job was strictly a cost cutting
move, as the position was not needed. T. 346. When asked under
oath at the hearing whether it was a decision just to eliminate the job,
unconnected to the Complainant, Respondent’s Assistant Counsel,
Mr. Ambrosio, responded, “well, it probably had aconnection.. .”
T. 468-469. On October 11, 1984, by Resolution No. 25, the
Commissioners accepted the reorganization recommendation and
eliminated the position of Chief of Laboratory effective November
10, 1984, based on “need and economic conditions,” and terminated
Complainant. Complaint, Attachment No. 7; T. 288.
2 1 His
The present action was commenced by the filing of acomplaint
by Complainant on December 7, 1984. The matter was referred for
investigation to the Wage and Hour Division of the Department of
Labor, which, by letter of January 7, 1985, found no merit to the
complaint. Thereafter, on January 11, 1985, Complainant re-
quested a hearing with the Office of Administrative Law Judges.
Prior to the hearing Complainant was encouraged by the ALJ
to be represented by counsel, but Complainant elected instead to
appear pro se. T. 5. The hearing was held over a period of 1-1/2
days on February 19 and 20, 1985, at a time when the ALJ was
present at the hearing site for 4-1/2 days to hear this and other cases.
The two volume hearing transcript exceeds 400 pages of testimony.
Complainant brought no witnesses to the hearing, T. 495, but
testified himself and was subjected to Respondent’s cross-exami-
nation. Respondent’s counsel, Mr. Ambrosio, brought two wit-
nesses to the hearing, Mr. Perrapato, P.V.S.C.’s Executive Director,
and Mr. D’Ascensio, Chief of Industrial Waste and Complainant’s
former supervisor. Both of these witnesses testified and were
subjected to cross-examination by Complainant, and to questioning
by the ALJ. At Complainant’s request, Respondent’s counsel at the
hearing, Mr. Ambrosio, was also swom and questioned at length by
Complainant and by the ALJ.
During the hearing, in response to the development of
a-22
Respondent’s case, through the testimony of Respondent’s wit-
nesses, Complainant requested that he be permitted to bring addi-
tional witnesses in rebuttal. Complainant, in this regard, requested
that co-worker Art Martinelli be called, T. 307, 486; that the lab
people and department managers testify, T. 388; that the former
personnel manager, Mr. Santamassino, testify, T. 435, 494; and that
all the Commissioners testify, T. 391, 393. In response to these
many requests, to which Respondent’s counsel objected, the ALJ
made several procedural rulings to ensure that the parties would be
afforded a full and fairhearing. The ALJ ruled that the record would
be held open for 15 days for Complainant to take depositions or to
secure affidavits, Respondent waiving any right of cross-examina-
tion of Mr. Santamassino. T. 390, 392, 395,486,489, 497,499. The
ALJ also permitted Complainant to bring any witnesses he desired
to the hearing then convened in New York City within the following
two days, February 21 and 22, 1985, for the purpose of testifying.
T. 390. Complainant did not avail himself of any of these opportu-
nities. The record further reflects that an attomey, David E.
Schwartz, on behalf of Complainant, wrote a confirmatory letter on
March 8, 1985, to the ALJ acknowledging, pursuant to their prior
telephone conversation, that the record would be held open an
additional 15 days from March 8, 1985, pending Complainant’s
decision as to additional hearing requests.* The ALJ acknowledged
his verbal order to this effect in his R.D. and O. at 1. No further
correspondence or motions were received, id., and the ALJ issued
his R.D. and O. on April 17, 1985.
The Secretary issued a briefing schedule, duly served on the
parties, on January 25, 1990. In response thereto Complainant,
acting pro se, filed an initial brief, indicating service of same on
counsel for Respondent. Respondent filed no pleadings on review
before the Secretary.
4 The attorney’s letter of March 8, 1985 makes no mention of participation by
Complainant in any settlement negotiations, or efforts regarding Complainant's
rehire by P.V.S.C. Although the Executive Director testified at the hearing that he
would recommend to the Commissioners that Complainant be rehired as a
chemist’s helper, T. 318, 344, if Compainant wanted such a position, there is no
record evidence that this idea was pursued in any manner.
)
DISCUSSION
1. The Prima Facie Case
A prima facie case is made out by an employee alleging
retaliatory discharge under the whistleblower provision by showing
1) that the employee engaged in conduct protected by the FWPCA;
2) that the employer was aware of that conduct and took some
adverse action against the employee; and 3) that the inference is
raised that the protected activity was the likely reason for the
adverse action. See Dartey v. Zack f Chicago, Case No. 82-
ERA-2, Sec. Order, April 25, 1983 (Dartey), slip op. at 7-8; accord
D'Agostino v. B & O Distribution Service, Inc., Case No. 88-STA-
11, Sec. Order, May 10, 1989, slip op. at 4. See also Mackowiak v.
niversity Nuclear Systems, Inc,, 735 F.2d 1159, 1162 (9th Cir.
1984).
The ALJ limited his analysis of whether Complainant engaged
in activity protected under the FWPCA to the question of whether
Complainant actually took his complaints to the EPA, or stated his
intention to do so in a telephone conversation with Respondent’s
counsel, Mr. Ambrosio, in April or May of 1984. On this record,
there is no evidence that any actual contact with EPA ever took
place, T. 69, 86, and the ALJ found that even if Complainant had an
intention to do so, enough time had elapsed by the time of
Complainant’s termination without his having taken any action to
indicate that any intention on Complainant’s part to go public was
empty and inconsequential. R.D. and O. at 2. The ALJ thus found
that there was no relationship between Complainant’s termination
and any alleged intention to initiate an action with EPA.> Id.
In so holding, the ALJ noted a split in the circuit courts of
appeals over whether intemal complaints involving violations of
environmental laws are protected under the employee protection
> Because I hold infra athat Complainant's internal complaints to P.V.S.C.
officials regarding the user charge system constitute protected activity, it is not
necessary to make any findings concerning Complainant's alleged intent to report
violations to the EPA.
a-24
provisions of environmental statutes.© Finding Brown & Root, 747
F.2d at 1029, persuasive, the ALJ held that Complainant’s internal
complaints involving alleged violations of the FWPCA were not
protected activity. I disagree.
The paramount purpose of the whistleblower provision of the
FWPCA, regardless of anything to the contrary in Brown & Root,
is the protection of employees, see, ¢.g., English v. General Electric
Co., 110 S. Ct. 2270, 2277 (1990), a purpose which would be
frustrated by failing to protect from retaliatory action employees
who report violations intemally to their employers. As stated in
Willy v. The Coastal Corp., Case No. 85-CAA-1, Sec. Order, June
4, 1987, slip op. at 3, “[the Secretary] continue[s] to be persuaded
that reporting violations of the environmental statutes enumerated
in 29 C.F.R. § 24.1 internally to one’s employer is a protected
activity and that Mackowiak and Kansas Gas & Electric, rather than
Brown & Root, set forth the appropriate resolution of this issue.”
See Bivens v, Louisiana Power & Light, Case No. 89-ERA-30, Sec.
Dec. and Order of Remand, June 4, 1991, slip op. at 4-5; Nunn v.
Duke Power Co., Case No. 84-ERA-27, Sec. Order, July 30, 1987;
Poulos v. Ambassador Fuel Oil Co., Inc., Case No. 86-CAA-1, Sec.
Order, April 27, 1987. While Mackowiak and Kansas Gas &
Electric construed the employee protection provision only of the
Energy Reorganization Act of 1974, as amended (ERA), 42 U.S.C.
5851, the employee protection provisions of other statutes whose
language is more similar to the FWPCA have also been construed
to find coverage. See, e.g., NURBv. Scrivener, 405 U.S. 117(1972)
(construing Section 8(a)(4) of the NLRA, 29 U.S.C. § 158(a)(4));
NLRB v. Retail Employees Union, Local 876, 570 F.2d 586 (6th
Cir.) (same), cert. denied, 439 U.S. 819 (1978); Phillips v. Interior
Board of Mine Operations Appeals, 500 F.2d 772 (D.C. Cir. 1974)
© The ALJ cited only Brown & Root, Inc. v. Donovan, 747 F2d 1029 (Sth Cir.
1984), holding that internal compaints are not protected. At the time of the ALJ's
R.D. and O., circuit court decisions holding that internal complaints consitiute
protected activity were Mackowiak v. University Nuclear Systems, Inc., 735 F.2d
1159 (9th Cir. 1984), and Consolidated Edison Co. of N.Y. v. Donovan, 673 F. 2d
61 (2d Cir. 1982). Since then another court of appeals has held internal complaints
protected. Kansas Gas & Electric Co. v. Brock, 780 F. 2d 1505 (10th Cir. 1985),
cert. denied, 478 U.S. 1011 (1986).
a-25
(construing Section 110(b)(1) of the Coal Mine Health and Safety
Act (Coal Act), 30 U.S.C. § 820(b)(1)), cert. denied, 420 U.S. 938
(1975); Love v, RE/MAX of America, Inc., 738 F.2d 383 (10th Cir
1984) (construing Section 15(a)(3) of FLSA, 29 U.S.C. § 215
(a)(3)).’
In the present case, Complainant’s extensive reporting to
P.V.S.C. officials over a period of years that P.V.S.C.’s user charge
System violated the FWPCA is an activity fully protected under the
FWPCA.® Complainant consistently asserted to P.V.S.C. officials
that the split sampling method of monitoring industrial users was
meaningless and unreliable because the industrial users, instead of
P.V.S.C., were taking the samples. E.g., T. 59, 72, 82-84. The
samples provided to P.V.S.C. could therefore be anything the user
wanted them to be. As a result, Complainant contended,
Respondent’s user charge system could not assure that system users
were paying their proportionate share of waste treatment services as
expressly required under the FWPCA at 33 U.S.C. § 1284(b)(1 (A).
Under this provision, federal grant applicants such as P.V.S.C. must
assure proportionate cost sharing by system users as a condition fo1
7 My holding herein that Complanant reported alleged violations of the FWPCA
internally to P.V.S.C. officials sufficiently establishes as a matter of law that
Compainant engaged in protected activity. I note, moreover, notwithstanding any
differences between the FWPCA and the ERA, that my holding appears consistent
with Brown & Root Inc. v. Donovan, 747 F. 2d 1029, 1035 (Sth Cir. 1984), which
held that the ERA protects employees who provide competent governmer.t
officials with direct information. P.V. S.C. is a public agency in the State of New
Jersey whose commissioners are appointed by the governor and confirmed by the
State senate. The record shows that Complainant reported violations not only to his
immediate superiors, but also, directly and indirectly, to the full commission,
which, having some responsibility under the FWPCA, see, e.g., 33 U.S.C. §§ 1365
(h), 1370, could be viewed as a “competent organ of government” within the
meaning of Brown & Root, 747 F. 2d at 1036.
8 Because Compainant’s reporting of violations was extensive I need notdetermine
precisely when it commenced. Although it was not until March 23, 1984, that
Complainant identified the Clean Water Act as the statute being violated, he had
described the user charge system as subject to “legal repercussions” in his earlier
memorandum of November 23, 1982. See Aurich v. Consolidated Edison Co. of
N.Y., Inc. Case No. 86-CAA-2, Sec. Order, April 23, 1987 (Aurich) (complaint
about even possible violations of Clean Air Act protected).
a
a-26
the approval by EPA of constructions grants for treatment works.
As such, those persons whose negative impact on the environment
is substantial will pay substantially, rather than unduly burdening
those whose impact on the environment is only minimal. Although
Respondent’s treatment plant had already been constructed, Com-
plainant alleged that the user charge system subsequently devel-
oped and in place after start up of the facility did not satisfy the
FWPCA’s requirements. T. 23, 43, 64, 81.
That Complainant’s views in this regard may have been shown
on this record to be wrong, narrow, misguided, or, as the ALJ found,
“‘ill-formed and not based on direct knowledge,” R.D. and O. at 3,
does not render Complainant’s commun‘cations of his views unpro-
tected. Moreover, the ALJ erred as a matter of law in holding that
only valid complaints of employer violations are protected. The
FWPCA protects employees who allege employer violations of the
Act, even if those allegations are not ultimately substantiated. See
Aurich, slip op. at 4-5, see also Love vy, RE/MAX of Amenica, Inc.,,
738 F.2d 383, 385 (10th Cir. 1984) (Title VII cases); Munsey v,
Federal Mine Safety and Health Review Comm ’n, 595 F.2d 735,
742-743 (D.C. Cir. 1978) (NLRA and Coal Act); Allen v, Revco
D.S.,Inc,, Case No. 91-STA-9, Sec. Final Dec. and Order, Sept. 24,
1991, slip op. at 6 n.3 (Surface Transportation Assistance Act).
Were only actual and provable violations protected, employees
could rarely be assured that the apparent violations they identify for
reporting purposes would ultimately withstand the scrutiny re-
quired to gain protected status. Such a rule would so chill the
reporting of violations as to virtually eviscerate the statute. More-
over, I note that in the present case, however misguided
Complainant’s allegations may have been shown to be, there was
never any contention that they were frivolous or brought in abuse of
the statute. Rather, the record shows that they were press2d by the
Complainant in good faith as his very strongly and sericusly held
beliefs. I find that Complainant’s communication of these alleged
violations to P.V.S.C. officials was fully protected under the
whistleblower provision of the FWPCA. 33 U.S.C. § 1367.
As stated previously, in order to establish a prima facie case of
discriminatory action under the FWPCA, Complainant must show
not only that he engaged in protected conduct, but also that the
employer was aware of the conduct and took adverse action against
him, and Complainant must raise an inference that the protected
activity was the likely reason for the adverse action. Dartey, slip op.
at 6-9. The record clearly shows that Respondent knew of
Complainant’s protected conduct and took adverse action in abol-
ishing Complainant’s job and terminating him.
I find that Complainant also has raised the inference that his
protected activity was the likely reason for the adverse action. Mr.
D’Ascensio testified that he felt the Respondent’s entire user charge
system was in jeopardy because of Complainant’s opposition to that
system. T. 422-427. He expressed fear that P.V.S.C.’s credibility
and cooperative relationships with industrial users would be com-
promised, leading to abuse of the system. T.427-429. He attributed
this concem to Complainant’s ability, as head of the laboratory, to
fail to provide a sufficient number of sample analyses to maintain
the credibility with users that a self-monitoring system required.? In
short, Complainant was thought to pose a significant and substantial
threat to Respondent’s entire system of billing, in which Respon-
dent had invested extensive resources over a long period of time. |
find Respondent’s motivation to neutralize Complainant’s poten-
tially destructive impact on the user charge system was more than
sufficient to raise the necessary inference of causation.
2. Rebuttal of the Prima Facie Case
In the rebuttal phase of the case, Respondent has the burden of
production!® to present evidence that the alle ged adverse treatment
was motivated by legitimate, nondiscriminatory reasons. If so
produced, then Complainant has the opportunity to show that the
proffered reason was not the true reason for the employment
decision, but a pretext. Complainant may show this by establishing
that a discriminatory reason more likely motivated Respondent, or
9 Respondent never contended, however, that its decision to eliminate
Complianant’s position as Chief of the Laboratory was based, even in part, on
Complainant's job performance.
10 The ultimate burden of persuasion of the existence of international discrimination
rests with Complainant. Dartey, slip op. at 8.
OOOO Oe
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by showing that the proffered explanation is unworthy of credence.
Dartey, slip op. at 8.
Respondent met its burden of production by its proffer that the
elimination of Complainant’s job was based solely on economic |
factors, to save $46,000 per year for a position that was not needed. '
Memo of C. Perrapato, Exec. Dir., of September 6, 1984, RX 2. The
Executive Directortestified that employment positions with P.V.S.C.
were continually being pared since 1980 in order to lower budget
costs and, ultimately, to lower costs to system users. T. 267-269. He
further stated that the elimination Complainant’s position was
based strictly on the lack of need for the position and cost savings
in dollars. T. 346. Finally, the actually implementing document,
Resolution No. 25, voted unanimously by the Commissioners,
stated that “elimination of this position is based upon need and
economic conditions.”” Complaint, Attachment No. 7.
The evidence, however, persuasively shows that the
Respondent’s proffered reason is not worthy of credence, but is
pretextual.!! The memorandum of P.V.S.C.’s Executive Director
recommending the climination of Complainant’s job is based
strictly upon the needs of Passaic Valley and has nothing to do with
individual personalities."” RX 2. I conclude from this statement,
which the ALJ correctly regarded as “protesting too much,” R.D.
and O. at 4, that the reorganization recommendation had at least
something, if not everything, to do with Complainant’s individual
personality, which was principally manifested by his highly vocal
and unyielding objections to Respondent’s user charge system.
Further, P.V.S.C.’s Assistant Counsel, Mr. Ambrosio, conceded in
his testimony that the decision to terminate Complainant’s office
“probably had a connection” to Complainant himself, as opposed to
the reasons the Executive Director proffered. T. 468-469. Finally,
I note that in the reorganization combining the four departments, !2
'l | emphize that the ALJ, too, determined that Respondent's allegation that
Complaint’s termination was due cntirely to areorganization which eliminated his
job must be taken “with a large grain of salt.” R.D. and O. at 4.
12 Process Control, River Inspectors, Industrial Waste and Laboratory and Pollution
Conwol. T. 287.
a-29
the only supervisory chief eliminated was Complainant.!3\ For
these reasons I conclude that Respondent's proffered explanation
that the elimination of Complainant's job was based strictly on the
need of the job and on economic conditions is not worthy of
credence, but is pretextual. Accordingly, I find that Complainant
has carried his burden of persuasion that he was discriminated
againstinhis employment for activity protected underthe FWPCA. !4
3. Dual Motive Doctrine
As an altemative basis for the denial of recovering the case, the
ALJ found under the dual motive doctrine propounded in Mt.
Healthy City School District Board of Education v. Doyle, 429 U.S.
274 (1977), that even if Complainant had established a prima facie
case, Respondent rebutted any such presumption. R.D. and O. at 4.
Although Complainant has met his ultimate burden of persuasion
through the finding that Respondent's proffered reason for dis-
charging him was pretextual, a determination of the dual motive
issue now is consistent with principles of adjudicative economy.
On this record, even were I to credit P.V.S.C.’s economics expla-
nation as a partial motive for the discharge, I believe that under the
dual motive doctrine Complainant must prevail.
The dual motive doctrine is implicated when it is found that the
employer’s adverse action against the employee was motivated by
both prohibited and legitimate reasons, i.¢., that the employer had
dual motives. Dartey slip op. at 8-9; see Mt. Healthy, 429 U.S. at
13 Contrary to Complainant's assertion on appeal that his job as Chief of the
Laboratory was not really abolished but filled with another person, Claimant's
Brief, p. 8-9, the record shows that in the reorganization, Mr. Douglas Borgatti,
Ph.D., formerly Chief of Process Control, was placed in charge of all four
departments. T. 287. As such, Mr. Borgatti assumed the duties of Chief of the
Laboratory and other supervisory duties as well. It follows that the position of
Chief of the Laboratory was abolished.
14 In view of my disposition of this issue, I do not address in detail Complainant's
allegations that he was denied due process at the hearing below. The facts
recounted supra at pp. 7-9 demonstrate that Complainant was afforded a full and
fair hearing and all due process rights provided by law.
a-30
287; Mackowiak, 735 F.2d at 1163; Consolidated Edison, 673 F.2d
at 62-63. If suchis the case, the employer, in order to avoid liability,
has the burden to show by a preponderance of the evidence that it
would have reached the same decision as to the employee’s dis-
missal even in the absence of the protected conduct.!> Dartey, slip
op. at 9; Mt, Healthy, 429 U.S. at 287; Mackowiak, 735 F.2d at
1164; Consolidated Edison, 673 F.2d at 63. In dual motive cases,
the employer bears the risk that the influence of legal and illegal
motives cannot be separated. Mackowiak, 735 F.2d at 1164.
In his analysis of dual motive, R.D. and O. at 4, the ALJ
concluded that Complainant’s underlying motivation for alleging
violations was “job and ego, rather than public pollution protection
oriented.”!© Noting that Respondent attempted to deal openly and
reasonably with Complainant’s recommendations, the ALJ con-
cluded that there was no evidence that Complainant’s discharge was
taken either to retaliate for Complainant’s unproven intent to take
action before the EPA or to conceal any wrongdoing. The ALJ
concluded further that a personnel evaluation was made in the
reorganization move, despite Respondent’s protests to the contrary,
but that Respondent had every right to make such an evaluation.
I cannot accept the ALJ’s analysis. First, I note that it is not
Complainant’s underlying motive in reporting violations of the
FWPCA that must be established and considered. The FWPCA
operates to protect an employee’s conduct in reporting violations of
the statute notwithstanding his motives. Cf. Assistant Secretary and
Moravec v, HC & M Transportation Inc., Case No. 90-STA-44,
Sec. Dec. and Order of Remand, Jul. 11, 1991, slip op. at 6 n.6.
Further, under the dual motive doctrine, it is Respondent’s motiva-
tion that is under scrutiny, not Complainant’ s, because upon finding
that Respondent’s action was motivated by legitimate and illegiti-
mate reasons, it must be ascertained whether Respondent has shown
15 The Supreme Court has affirmed this approach to the dual motive analysis in
Price Waterhouse v. Hopkins, 490 U.S. 228, 109 S. Ct. 1775 (1989).
16 Although the ALJ refers to this regard to the investigative finding of the
Compliance Officer, R.D. and O. at 4, the ALJ’s consideration of the case is de
novo. See Smith v. Tennessee Valley Authority, Case No. 87-ERA-20, Sec. Order,
April 27, 1990, slip op. at 4 n.2.
a-31
that the same decision as to Complainant’s discharge would have
been reached even in the absence of Complainant’s protected
conduct. See, e.g., Price Waterhouse, 490 U.S. at 248-255.
Further, in concluding that it was not shown that Respondent’ s
adverse action was in retaliation for Complainant’s protected con-
duct,!” because Respondent dealt openly with Complainant’s rec-
ommendations, the ALJ has reversed the burdens. It is not for
Complainant to prove anew the presence of retaliatory motive ina
dual motive analysis, but for Respondent to separate the influence
of both motives and to show that Compiainant would have been
discharged even if protected activity had not occurred.
Respondent did not meet that burden. Respondent denied
(except for the concession extracted from Mr. Ambrosio, supra at
16) that it was motivated, even in part, to discharge Complainant by
reason of his protected conduct. Respondent chose to rely solely
upon this denial and thus made no attempt to show that it would have
discharged Complainant even in the absence of such conduct.!® As
stated in N.L.R.B. v. Transportation Management Corp., 462 U.S.
393 (1983):
The employer is a wrongdoer; he has acted out of amotive
that is declared illegitimate by the statuie. It is fair that he
bear the risk that the influence of legal and illegal motives
cannot be separated, because he knowingly created the
risk and because the risk was created not by innocent
activity, but by his own wrongdoing.
462 U.S. at 403. Simply put, the legitimate and illegitimate motives
have not been sorted or separated and it has not been shown that
Complainant’s job would have been legitimately eliminated even in
the absence of protected conduct. Thus I find that if this case is
examined under the dual motive analysis, Complainant’s discharge
was discriminatory and is subject to remedy under the statute.
17 Asdiscussed above, the ALJ impermissibly narrowed the scope of Complainant’ s
protected conduct to his alleged intent to go public to the EPA.
18 | find no basis in the record for the ALJ's finding that a “personnel evaluation”
was made in the reorganization in which, as the ALJ implies, Complainant was
passed over in favor of Mr. D’ Ascensio.
a-32
REMEDY
Pursuant to 33 U.S.C. § 1367(b) and 29 C.F.F. 24.6(b), it is
ORDERED that:
1. Respondent shall take affirmative action to abate the viola-
tion including: reinstating Complainant to a position substantially
equivalent to the one he held when he was discharged on November
10, 1984 (assuming that Complainant remains willing and available
to work).
2. Respondent shall pay Complainant back pay from Novem-
ber 10, 1984, to the date of reinstatement, less interim eamings (if
any) and periods (if any) when Complainant was unavailable for
work because of illness, disability or other reasons.
3. Back pay as computed above shall include all benefits to
which Complainant would have been entitled had he not been
discharged.
4. Back pay as computed above shall include interest com-
mencing from the date of discharge on November 10, 1984, and
continuing to the date of reinstatement at the rate continuously then
in effect under 26 U.S.C. § 6621(a)(2), the underpayment rate. See,
e.g., Clinchfield Coal Co. v. Federal Min
Comm'n, 895 F.2d 773, 778-780 (D.C. Cir. 1990).
Complainant’s request for compensatory and punitive dam-
ages is denied. !9
SO ORDERED.
Secretary of Labor
Washington, D.C.
*9 Complainant's request for compensatory and punitive damages is made for the
first time on review before the Secretary. Punitive damages are not allowable
absent express statutory authorization and Section 507 of the FWPCA, 33 U.S.C.
§ 1367, contains no such authorization. Although compensatory damages are
allowable pursuant to 29 C.F.R. § 24.6 (b) (2), my decision must be based on the
record and the recommended decision of the ALJ. 29 C.F.R. § 24% (b) (1).
Complainant, who bears the burden on the issue, never requested compensatory
damages in the proceedings below either in the pleadings he filed or at the hearing,
nor did he introduce into the record any evidentiary basis upon which such an
award could be made. In this posture, I conclude that any request for compensatory
damages in this case has been waived.
U.S. Department of Labor Office of Administrative Law Judges
1111 20th Street, N.W.
Washington, D.C. 20036
In the Matter of:
JOSEPH GUTTMAN .
Claimant : Case No. 85-WPC-2
v.
PASSAIC VALLEY
SEWERAGE COMMISSIONERS
Employer
David E. Schwartz, Esq.
For the Claimant
Gabriel M. Ambrosio, Esq.
For the Employer
Before: JOHN C. HOLMES
Administrative Law Judge
RECOMMENDED DECISION AND
ORDER DENYING CLAIM
This matter arises under the provisions of the Water Pollution
Control Act, 33 U.S.C. 1367. Claimant, Joseph Guttman, alleges
that he was terminated from his position as Chief of Laboratory and
Pollution Control by Employer, Passaic Valley Sewerage Commis-
sioners, in a discriminatory fashion in violation of the Act. The
hearing was requested after the Regional Director of the Wage and
Hour Division, Barry Sullivan, found the matter was not a protected
a-34
activity under the Act. A hearing was held in New York City, New
York on February 19 and 20, 1985. At the time, Mr. Guttman was
unrepresented; he asked for a continuance inter alia to obtain an
attomey. I denied this motion, since employer’s witnesses were
present to testify, and since I had specifically informed Mr. Guttman
prior to the hearing of the desirability of obtaining counsel. The
hearing was held over a two day period which additionally gave
claimant opportunity to obtain counsel. (Tr.5-8,255) The record
subsequently was held open for 15 days for any additional testi-
mony as well as to allow Claimant opportunity to obtain counsel to
review the case. (Tr.493-499) Subsequent to the hearing I was
contacted by David E. Schwartz, Esq. who informed me that he
represented Mr. Guttman in this action. By letter dated March 8,
1985, Mr. Schwartz confirmed our conversation, noting my verbal
order permitting the record to be kept open foran additional 15 days.
No further correspondence or motions have been received.
ment of th se:_Iss
29 C.F.R. 24.1 et seq. set out the procedures for handling of
discrimination under federal employee protection statutes. 29
C.F.F. 24.2 (b)(1) states that a violation exists if an employee is
discharged or discriminated against who has commenced, or caused
to be commenced a proceeding for the enforcement of any require-
ment imposed under a protected Act, testified or about to testify in
any such proceeding or assisted or participated in any manner in any
proceeding to carry out the purposes of a protected Federal statute.
The threshold issue to be determined, therefore, is whether claimant
has established jurisdiction to bring his complaint, i.e. whether he
has met the standards under 29 C.F.R. 24 2(b)(1). Employer has _
maintained continuously that no such jurisdiction exists. (Tr.252-
55,11,12)
indings of F nclusion :
The stated intent of the Part 29 regulations is to protect
employees from discrimination based on their actual or clearly
stated intent to testify or participate in Environmental Protection
Agency proceedings. The obvious intent is to not discourage the
a-35
bringing forth of information known to employees that may be
unknown to public officials which information may have a bearing
on the nation’s environment by protecting the employee; such
employee activity is commonly called “whistleblowing.”
Here, Claimant by his own admission acknowledged that on
only one occasion did he discuss with anyone taking his complaint
to the Environmental Protection Agency (or any other public body);
this occasion, which allegedly took place during either one or two
conversations, was with counsel for Employer Gabriel M. Ambrosio
during the period of April-May 12, 1984. (Tr.451, 495, 465, 441-
447) Mr. Ambrosio testified at the hearing that such a conversation
never took place (Tr. 442, 453-455), or that if it did, the “threat” of
going to the EPA was so vaguely made that he did not take it
seriously enough to pass the information to anyone, including the
Commissioners who eventually terminated Claimant on November
11, 1984. (Tr. 486-491).
From all the evidence, I conclude that there was no relationship
detween Claimant’s termination and his alleged intention to initiate
an action with EPA. Indeed, Claimant never did make any serious
attempts at taking alleged water pollution control violations public.
To the contrary, he was granted an opportunity to present his views
to the Commissioners at a May 15, 1984 meeting. Ratherthan being
“restrained by a skillfully orchestrated delusion” by Employer
(“Opening Statements and Testimony” pp.2) Claimant was af-
forded intemal opportunity to have his views heard. Over 6 months
passed between the time Claimant presented his views and his
termination. Thus even assuming, arguendo, that the Commission-
ers knew or suspected that Claimant had any intention of taking his
views public, an elegant sufficiency of time had passed during
which Claimant had taken no action whatsoever so as to indicate
any threat was empty and inconsequential.
In requiring an intention to take public action as opposed to
internal action, I recognize the Circuii Courts have split opinions.
By far the most reasonable approach, in my opinion is the Fifth
Circuit. In Brown & Root, Inc. v. Raymond J. Donovan, 747 F.2d
1029, (December 10, 1984), the Court stated (pp1031):
“[p1,2] The dispute in this case concerns whether under 42
U.S.C. 5851(a)(3) an employer is barred from discriminating
against any employee for the filing of an intracorporate quality
a-36
control report. We hold that the filing of such a report is not
protected by the statute. This decision is predicated on three
considerations: first, the statutory language cannot be stretched to
encompass such a filing. Second, the legislative history of the
Energy Reorganization Act (ERA) does not support such an exten-
sion of the meaning of section 5851. Third, the structure of the ERA
indicates that section 5851(a) is designed solely to protect from
retaliation corporate “whistleblowers” who inform responsible
officials of corporate failings.”
Conceming specifically the ‘whistle blowing”’ aspect of the
Act, the Court stated (pp1034):
“The role of section 5851 in this legislative framework is clear:
to protect the integrity of the regulatory structure and to guard
against the possibility that corporate officers will not provide the
necessary information, section 5851 protects employees who pro-
vide competent govemment officials with directinformation. Thus,
section 5851 protects corporate “whistleblowers.” If a corporate
officer fails to act on an internal report critical of safety conditions,
he is liable under section 5846. While an individual employee
disciplined for the filing of an internal report is not entitled to
redress under section 5846, any officer responsible for the disci-
pline must bear in mind that he will be subject to sanction. Thus, the
overall plan of the ERA is to maintain public safety not restructure
the employee-employer relationship.”
Claimant has failed to demonstrate an action protected by the
Act on the additional basis that he has not stated a protected activity.
While Claimant in testimony and memorandum frequently alludes
to “illegal” activities of Employer, the consistent alleged violation
he asserts is Employer’s user charge system which he alleges costs
municipalities and other users increased costs. (Opening Statement
& Testimony, pp. 3 & 10-12, Tr. 440, 441). Employer’s manage-
ment decision in that connection was a policy matter involving user
fees, an activity which is only tangentially covered by the Act.
Claimant’s other allegation is that Employer’s split-sampling per-
mitted users rather than PVSC to determine water quality. How-
ever, Claimant was unaware of Employer’s total verification pro-
gram. (Tr.380-383) Claimant’s allegations in this connection were
ill-formed and not based on direct knowledge. It is not enough that
a-37
there may exist an alleged violation, if not specifically known by the
“whistleblower.”” Moreover, here, Claimant’s initial objection to
split samples was on a cost basis rather than an alleged violation
(Appendix A-2).
As pointed out by Compliance Officer, Bruce Sullivan, in his
well documented and reasoned findings forwarded to this office on
January 29, 1985, although Mr. Guttman had set out objections to
the user charge system for years dating back to 1981, his first written
indication that the system was in violation of the Clean Water Act
was on March 23, 1984. (Coincidentally, Claimant had been given
a complete and critical personnel evaluation on February 28, 1984).
Based on the entire history of Mr. Guttman’s dispute with PVSC, as
well as his testimony and demeanor at the hearing, I conclude that
Claimant’s underlying motivation for alleging violations was job
and ego rather than public pollution protection oriented. Employer
used reasonable methods to examine the recommendations made by
Mr. Guttman and to attempt to reasonably deal with the situation.
Forexample, on April 19, 1984, Claimant’s immediate Supervisor,
Frank P. D’Ascenscio wrote a 13 page memorandum (E#13)
replying to Mr. Guttman’s March 24, 1984 memo, clearly outlining
in objective terms PSVC’s program and rebutting Mr. Guttman’s
charges including answering charges going back to August 1981.
At the very least, Employer’s actions show a clear intention to
openly deal with Mr. Guttman’s allegations; there has not been
evidenced directly or circumstantial any malicious attempt to fire
Mr. Guttman in retaliation for his alleged but unproven intent to take
action in bringing PSVC’s procedures before the EPA, or in any
matter to conceal from Mr. Guttman, other employees of the public
any wrongdoing. Thus even had Claimant established a prima facie
case ofa discrimination, (which he has not) under the ‘‘dual motive”
doctrine propounded in Mt. Healthy City School District v. Doyle,
429 U.S. 274 (1977), Employer has rebutted any such presumption.
In that connection, however, Employer’s oft repeated allega-
tion that Guttman’s termination was entirely due to a reorganization
which eliminated Guttman’s job must be taken with a large grain of
salt. Forexample, PSVC’s Executive Director, Carmine T. Perrapato,
who, also, testified at the hearing, by indicating in his reorganiza-
tion memo of September 6, 1984 that the Chief of Laboratory
position was no longer needed, but that no personnel action was
a-38
indicated “protested too much”; at the very least, a personnel
evaluation was made in reorganizing the Commission. (Tr.293-
297) However, Employer had every right to make such an evalu-
ation. Much of Mr. Guttman’s problems and the probably underly-
ing reasons for the present action is the ascendancy in the organiza-
tional hierarchy of Mr. Frank D. Ascenscio over himself. While it
would be inappropriate and impossible for me to discuss the
technical skills of either man, the skills demonstrated in analytical
thinking, communicating, dealing in interpersonal relationships
and in general comportment were obviously to the benefit of Mr.
Ascenscio as could be observed even in the relatively short period
of a hearing.
In summary, Mr. Guttman has made an unverified, unwar-
ranted and apparently unmeritorious allegation of a violation of the
Act. He has takenno serious steps to bring the matter to the attention
of EPA officials, if, indeed, he ever sincerely believed a violation
had occurred. Employer via a reorganization has terminated
Claimant after openly, carefully and fully dealing with all recom-
mendations and allegations. Such termination was fully within the
employer/employee relationship and not in retaliation for alleged
violations of the Act.!
ORDER
Claimant’s application for relief is denied.
JOHN C. HOLMES
Administrative Law Judge
Date Issued:
Washington, D.C. TRE TESS
JCH/mlc
| This case exemplifies fully the wisdom of the Court in Brown & Root, supra.
An employee should not be able to escape the normal requirement of competency
in his job by merely alleging internally that violations of the Act exist.
U.S. Department of Labor Employment Stantards Administration
Wage and Hour Division
Peter W. Roding Federal Bidg.
[) 970 Broad St., Room 836
Newark, N.J. 07012
Reply to the Attention of: (201) 645-2279
January 7, 1985
Reference:
Joseph Guttman vs. Passaic
Valley Sewerage Commissioners
Mr. Joseph Guttman
20 Marshall Street
Irvington, N.J. 07111
Dear Mr. Guttman:
This letter is to notify you of the results of our compliance
actions in the above case. A previous letter fron this office advised
you that your complaint was received on December 7, 1984 and
enclosed a copy of Regulations, 29 CFR Part 24 and a copy of the
pertinent section of the Federal Water Pollution Control Act.
Our initial efforts to conciliate the matter revealed that the
parties would not at that time reach a mutually agreeable settlement.
An investigation was then conducted. Our investigation did not
verify that discrimination was a factor in the actions comprising
your complaint. Conversely, it is our conclusion that your allega-
tions are unprovable for the following reasons:
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Your actions did not constitute a protected activity within the
meaning of Section 507(a) of the Federal Water Pollution Control
Act or Regulations Part 24.2.
(1) No proceeding was initiated nor testimony
given to the EPA.
(2) The firm did not restrain you from initiating an
action and, in fact, scheduled you to appear at a
PVSC Commissioner’s meeting to present your
position.
This letter will notify you that if you wish to appeal the above
findings you have a right to a formal hearing on the record. To
exercise this right you must, within five (5) callendar days of receipt
of this letter, file your request for a hearing by telegram to:
The Chidf Administrative Law Judge
U.S. Department of Labor
Suite 700, Vanguard Building
1111 - 20th Street, NW
Washingtion, D.C. 20036
Unless a telegram request is received by the Chief Administra-
tive Law Judge within the five-day period, this notice of determina-
tion will become the final order of the Secretary of Labor dismissing
your complaint. By copy of this letter I am advising in this case and
the right to a hearing. A copy os this letter has also been sent to the
Chief Administrative Law Judge with your complaint. If you decide
to request a hearing it will be necessary to send copies of the
telegram to the Passaic Valley Sewerage Commissioners and to me
at the above address. After I receive the copy of your request,
appropriate preparations for the hearing can be made. If you have
any questions do not hesitate to call me.
It should be made clear to all parties that the role of this
Department of Labor is not to represent the parties in any hearing.
The Department would be neutral in such a hearing which is simply
part of the fact-development process, and only allows the parties an
Opportunity to present evidence for the record. If there is a hearing,
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an Order of the Secretary shall be based upon the record made at said
hearing, and shall either provide appropriate relief or deny the
complaint.
Sincerely,
Thomas J. Davine
Area Director
cc: Passaic Valley Sewerage Commissioners
EPA
Gabriel M. Ambrosio, Esq.
This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.