Campbell v. Eli Lilly & Co.

413 N.E.2d 1054, 115 L.R.R.M. (BNA) 4417, 1980 Ind. App. LEXIS 1841

• Court: Indiana Court of Appeals
• Decided: December 30, 1980
• Docket: 2-580A151
• Status: Published

Opinions

NEAL, Judge.

STATEMENT OF THE CASE

James T. Campbell appeals the granting of summary judgment against him in his action against Eli Lilly & Company (Lilly), in which he sought damages and reinstatement based upon his discharge by Lilly.¹

We affirm.

STATEMENT OF THE FACTS

The facts most favorable to Campbell, as the non-moving party, reveal the following. Campbell was employed by Lilly, a pharmaceutical manufacturer, as an antibiotic operator in 1953. He became a technical associate in the research section in 1967, which position he maintained until the employment relationship terminated in 1978. From April, 1973, through the remainder of his employment, Campbell worked, at different times, as a technical associate for three separate research teams conducting research on various drugs. Campbell had no written contract of employment with Lilly, and there was no agreement as to a definite term of employment.

On December 2, 1977, Campbell’s attorney, Carl Peters, met with Lilly’s staff counsel. Peters related in substance that Campbell had knowledge of various acts of misconduct on the part of the superiors under whom he was assigned during the 1973-1978 period. Campbell further questioned the safety of some of the drugs and made other accusations. At the close of the meeting it was determined that Lilly would investigate Campbell’s allegations. Campbell was placed on a paid leave of absence pending completion of the investigation.

The investigation was completed by Jan-, uary 9, 1978, on which date a meeting of Campbell, Peters, and Lilly officials was held. At this meeting, Campbell reiterated his allegations of misconduct and contended that his research work saved Lilly some $500,000,000 in future claims against the company. Lilly reported the findings of its investigation and concluded that Campbell’s accusations were totally false. Campbell was placed on an unpaid leave of absence.

Campbell was subsequently informed that there was no job for him at Lilly and on March 21, 1978, he advised Lilly that he had quit. Campbell was fully paid for the work he had done and received all company benefits that had accrued to him, including pension.

ISSUES

Campbell presents six issues for review essentially as follows:

I. Whether the trial court abused its discretion by allowing Lilly 122 days in which to file a responsive pleading;

II. Whether the trial court erred in limiting discovery;

III. Whether the trial court was imper-missibly biased and prejudiced;

IV. Whether the cumulative effect of the alleged errors asserted in Issues I — III denied Campbell his rights to fair proceedings;

V. Whether a cognizable claim is stated by a former at will employee who claims he was discharged in retaliation for having reported to company officials serious allegations of misconduct on the part of his superiors.

VI. Whether the trial court erred in allegedly determining an issue of material fact regarding the existence of a covenant of employment.

DISCUSSION AND DECISION

Standard of Review

The principles we apply in reviewing a summary judgment are familiar. Ind. Rules of Procedure, Trial Rule 56(C) states in part that:

“The judgment sought shall be rendered forthwith if the pleadings, depositions, answer to interrogatories, and admissions on file, together with the affidavits and testimony, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.”

Our task on review, therefore, is to determine whether there is any genuine issue of material fact and whether the law was correctly applied. Smith v. P. & B. Corporation, (1979) Ind.App., 386 N.E.2d 1232. In so determining the existence of a genuine issue of material fact, we accept as true all facts set forth by the party opposing the motion and resolve all doubts against the party who moved for summary judgment. Johnson v. Motors Dispatch, Inc., (1977) Ind.App., 360 N.E.2d 224; St. Joseph Bank & Trust Company of South Bend v. The Wackenhut Corporation, (1976) Ind.App., 352 N.E.2d 842.

Issue I. Granting enlargement of time

Campbell contends the trial court abused its discretion by allowing Lilly some 122 days to file its responsive pleading to his complaint. Campbell claims that the effect of the enlargements allowed Lilly was to “unduly delay the cause and frustrate the appellant’s reasonable efforts to secure a just determination of his action.”

Lilly contends that it received automatic enlargement of time in which to respond under Local Rule 5(H) of the Marion Circuit and Superior Courts. Prior to the expiration of the enlarged period, Campbell filed an amended complaint adding a new cause of action. Lilly then filed a motion for enlargement of time in response to the filing of the amended complaint. Lilly sought one further enlargement to accommodate the filing and signing of Campbell’s deposition.

Ind. Rules of Procedure, Trial Rule 6 provides the trial court with discretion to permit enlargements of time for pleadings. Only an abuse of that discretion will allow this court to reverse the decision in Campbell’s favor. Snyder v. Tell City Clinic, (1979) Ind.App., 391 N.E.2d 623. The record shows that a good portion of the delay was occasioned by Campbell’s filing the amended complaint and his reluctance to sign his own deposition. Further delay was attributed to the reporter who transcribed the deposition. Campbell has failed to demonstrate any prejudice whatever. There was no abuse of discretion.

Issue II. Discovery

Campbell argues that the trial court abused its discretion in limiting discovery. In particular, Campbell complains that the trial court failed to compel Lilly to answer certain interrogatories. Additionally, Campbell asserts that the trial court failed to enter a ruling on Lilly’s motion to limit discovery. Campbell urges that the trial court’s action prevented him from pursuing his case in an “orderly, full fashion,” and that the trial court, in ruling on Lilly’s motion for summary judgment before discovery had been completed, acted contrary to the policy underlying summary judgment.

In ruling on issues of discovery, the trial court exercises its judicial discretion; this court will interfere only if the trial court has abused its discretion. Geib v. Estate of Geib, (1979) Ind.App., 395 N.E.2d 336.

In the case at bar, Lilly successfully sought to limit discovery, temporarily, to matters relevant to the issues raised by its motion for summary judgment.

At a pretrial conference, the trial court directed the parties to limit discovery, temporarily, to matters relevant to the disposition of Lilly’s motion for summary judgment. This consisted of restricting Campbell’s discovery to the deposition of the two Lilly employees, Dr. Tuttle and Mr. Taylor, who were identified by Campbell as having knowledge of issues relevant to the motion. Indeed, Campbell failed to depose these witnesses prior to the hearing on the summary judgment motion, and declined to take advantage of the court’s reasonable offer to delay hearing on the motion until Campbell took those depositions. Campbell does not set forth in his brief with any specificity whatever the nature of the ihterrogatories he sought to be answered by Lilly. Lilly characterizes these interrogatories as lengthy and convoluted and relating matters not relevant to the summary judgment motion.

We find no abuse of discretion. Lilly directs us to the case of Newton v. Yates, (1976) Ind.App., 353 N.E.2d 485, wherein this court affirmed the delaying of discovery relating to punitive damages, pending determination of other issues, stating:

“The ‘principle of judicial parsimony’ allows a court to delay or suspend discovery on one issue if the outcome of another issue, to be tried first, will be dispositive of the entire case.” (Citations omitted.)

353 N.E.2d at 491.

This principle was followed, and prudently so, in the case at bar.

Issue III. Trial court bias

In this issue, Campbell claims that he was denied his due process right to a fair proceeding and that the trial judge demonstrated bias, prejudice, and hostility to Campbell. In his brief, he points to several examples of alleged bias on the part of the trial court consisting of statements made by the trial judge at the summary judgment hearing.

We have carefully examined the specific references cited by Campbell. Regarding the court’s expressions of alleged antipathy toward the Food and Drug Administration, and the federal bureaucracy in general, we see nothing indicating an unfair predisposition on the part of the judge to Campbell’s case. Campbell claims the trial judge erroneously rejected relevant evidence at the hearing. Campbell made no objection; indeed, his counsel stated that he understood the trial court’s reasoning. Campbell points to the judge’s remark in reference to the personnel manual that, “I am not about to read Lilly’s gingerbread book. It doesn’t apply to this particular case.” While this characterization of the manual is interesting, nevertheless the determination of its inapplicability to the case is correct. See discussion of Issue VI, infra. Campbell notes that the judge characterized Counts I, II, and III of the complaint as “hogwash.” We disagree that this expression tends to show prejudice. It is a familiar and colloquial manner of saying that the judge found those counts of the complaint as being without merit, and ultimately ruled accordingly.

Finally, Campbell alludes to other remarks contended to reflect bias, prejudice and hostility. We feel that expressions of personal opinion are better left unsaid, but note that this, was a hearing on a pretrial motion and, of course, no jury was present or had even been assembled. In the context of the proceedings, the remarks consisted of the judge’s musings about issues irrelevant to the trial. It is axiomatic that for alleged prejudice and hostility to be reversible, some harm must be shown. Inasmuch as we affirm the trial court’s application of the law to this case, and since no factual dispute needed to be resolved by the court that could possibly have been tainted by prejudice, we fail to see any harm demonstrated.

Issue IV. Cumulative error

Campbell contends that the cumulative effect of the alleged irregularities in Issues I — III denied him a fair or meaningful hearing on his complaint. Since we found no error to have been shown in those issues it follows, a fortiori, that no error is shown here.

Issue V. Retaliatory discharge

This is the heart of the appeal. Campbell claims the trial court erred in determining that in complaining to Lilly officials about its products and personnel, he was not exercising a right conferred upon him by a statute or protected by statute. The trial court found that his claim of retaliatory discharge does not state a valid claim which qualifies as an exception to the employment at will doctrine recognized by the Supreme Court of Indiana. The court further found that there is no recognized public policy restricting the right of an employer to discharge an at will employee who charges the employer with practices allegedly contrary to the federal drug regulatory scheme and the regulations issued thereunder. Absent the existence of a statutorily conferred right, and Campbell’s alleged exercise of that right, the court concluded, Campbell, in alleging that Lilly’s termination of his employment violated general public policy, failed to state a claim upon which relief can be granted.

Campbell’s position may be summarized in the following way: The principal responsibility is imposed upon the manufacturer to develop the data upon which the United States Food and Drug Administration (FDA) reviews, analyzes, classifies and finally determines the suitability for sale of a particular drug. The sale of drugs which have not attained approval by the FDA may be a basis for criminal prosecution. The scheme requires the full cooperation of the manufacturer in reporting all relevant data, particularly that which may identify adverse reactions occasioned by the administration of the drug. Given that the responsibility is placed upon the manufacturer to so report, it follows that the responsibility is ultimately borne by the employees of the manufacturer. If an employee reports misconduct of his superiors which allegedly impairs the integrity of that data, important public policy would be frustrated if the employee is discharged in retaliation for so reporting, presuming the deterrent effect such discharge would have upon other employees in carrying out their responsibilities.

Resolution of this issue requires an examination of the traditional at will employment doctrine and an exception to that doctrine recently recognized in Indiana. It was early stated:

“The rule seems to be well settled, by the great weight of authority, that where, by the terms of a contract, whether it be written or verbal, where the contract is one for employment, and by its terms, the tenure of service cannot be determined, such contract is one at will, and may be terminated at any time, at the election of either party.”

Speeder Cycle Company v. Teeter, (1897) 18 Ind.App. 474, 477, 48 N.E. 595.

The rule has been confirmed in Indiana over the years. See Martin v. Platt, (1979) Ind.App., 386 N.E.2d 1026; Shaw v. S. S. Kresge Company, (1975) 167 Ind.App. 1, 328 N.E.2d 775; Montgomery Ward & Co. v. Guignet, (1942) 112 Ind.App. 661, 45 N.E.2d 337; Accord Davis v. Davis, (1926) 197 Ind. 386, 151 N.E. 134. See also Pearson v. Youngstown Sheet and Tube Company, (7th Cir.1964) 332 F.2d 439, cert. denied 379 U.S. 914, 85 S.Ct. 262, 13 L.Ed.2d 185 (applying Indiana law).

The employment at will doctrine has generally been followed, subject to contractual arid statutory limitations, throughout the jurisdictions. 9 S. Williston, Contracts § 1017 (3d ed. 1967); Restatement (Second) of Agency § 442 (1958); 56 C.J.S. Master and Servant § 31; 53 Am.Jur.2d Master and Servant § 43; Annotation: Employee’s Arbitrary Dismissal as Breach of Employment Contract Terminable at Will, 62 A.L.R.3d 271. “Although the employment at will rule has been almost uniformly criticised ... it has been widely followed.” Fortune v. National Cash Register Company, (1977) 373 Mass. 96, 364 N.E.2d 1251, 1255. Indeed, there is no paucity of commentary critical of the rule. See, e. g., Blades, Employment at Will vs. Individual Freedom: on Limiting the Abusive Exercise of Employer Power, 67 Colum.L.Rev. 1404 (1967).

Our Supreme Court most recently considered the employment at will doctrine in Frampton v. Central Indiana Gas Company, (1973) 260 Ind. 249, 297 N.E.2d 425. The issue in that case was whether a cognizable claim was stated by a former at will employee who alleged she was discharged in retaliation for having submitted a workmen’s compensation claim against her former employer. The court held that a cause of action would lie, thereby recognizing an exception to the traditional at will employment rule.

In reaching its decision, the court examined the Indiana workmen’s compensation legislation and found that it was designed to effectuate public policy by bestowing upon an employee the right to receive compensation for certain employment-related injuries, and imposing upon the employer the concomitant duty to compensate, through insurance, the injured employee. The public policy underlying the scheme was to shift the economic burden for employment-related injuries from the employee to the employer. The court recognized that, as a practical matter, injured employees might be reluctant to file deserving claims if such action would jeopardize their continued employment, and noted that the statute ² states:

“ ‘No contract or agreement, written or implied, no rule, regulation or other device shall, in any manner, operate to relieve any employer in whole or in part of any obligation created by this act.’ (our emphasis)”

260 Ind. at 252, 297 N.E.2d at 428. The court found the threat of discharge to be a “device” under the statute, and hence in clear contravention of public policy.

In conclusion, the court stated:

“We agree with the Court of Appeals that, under ordinary circumstances, an employee at will may be discharged without cause. However, when an employee is discharged solely for exercising a statutorily conferred right an exception to the general rule must be recognized.”

260 Ind. at 253, 297 N.E.2d at 429.

The case of Martin, supra, is particularly apposite here. In that case, two former at will employees alleged they were discharged in retaliation for having reported to a company official that their immediate superior had solicited and received illegal “kickbacks” from company suppliers. The Third District of this court refused to recognize a cause of action where the alleged reason for the discharge is contrary to general public policy, stating: “Normally, of course, the determination of what constitutes public policy, or which of competing public policies should be given precedence, is a function of the legislature.” 386 N.E.2d at 1028.

Campbell further contends that he was under a duty to communicate to his superiors the allegedly hazardous nature of certain of Lilly’s products. We recognize, as did the court in Martin, that several courts have recognized a cause of action for a former at will employee who alleged his discharge was in retaliation for his having fulfilled a statutorily imposed duty. See e. g. Nees v. Hocks, (1975) 272 Or. 210, 536 P.2d 512 (statutory obligation to perform jury service); Petermann v. International Brotherhood of Teamsters, (1959) 174 Cal. App.2d 184, 344 P.2d 25 (refusal to commit perjury).

We conclude from Frampton that in order to fall within a recognized exception to the employment at will rule, a plaintiff must demonstrate that he was discharged in retaliation for either having exercised a statutorily conferred personal right or having fulfilled a statutorily imposed duty in order to state a claim upon which relief may be granted. We have examined closely the materials submitted by the parties, and the authorities cited therein, and fail to discern that Campbell has stated such a claim under any resolution of the facts. He has nowhere demonstrated a statutory source for the alleged right he claims to have exercised, nor has he demonstrated a statutory source for the duty he claims to have fulfilled. We do not recognize the general public policy exception urged by Campbell to the venerable at will employment doctrine we reconfirm today.

The rationale for our result was stated in Percival v. General Motors Corporation, (8th Cir. 1976) 539 F.2d 1126. There, a complaint was dismissed which alleged an employee was discharged,

“... as a result of a conspiracy among his fellow executives to force him out of his'employment because of his age and because he had legitimately complained about certain allegedly deceptive practices of General Motors, had refused to give the government false information although urged to do [so] by colleagues ’and superiors, and had, on the contrary, undertaken to correct certain alleged misrepresentations made to the government by the defendant?’

539 F.2d at 1128. The federal court refused to predict that Michigan law would recognize the new theory that a discharge is actionable.if it is motivated by the fact that the employee did something that public policy encourages or that he refused to do something that public policy forbids. This being, essentially, the position taken by Campbell, we think the following comment by the Percival court is appropriate:

“It may be conceded to plaintiff that there are strong public policy arguments that can be made in support of the theory which he invokes; there are also strong policy arguments that can be made against it. It should be kept in mind that as far as an employment relationship is concerned, an employer as well as an employee has rights; and it should also be kept in mind that a large corporate employer such as General Motors, except to the extent limited by statute or contractual obligations, must be accorded wide latitude in determining whom it will employ and retain in employment. ..

539 F.2d at 1130.

There was no error in the trial court’s judgment.

Issue VI. Question of fact

In his final issue, Campbell claims that the trial court erred in granting summary judgment for Lilly, contending that a genuine issue exists as to his allegation that Lilly:

“... violated a covenant of the conditions of appellant’s employment that it would not terminate that employment for reporting, attempting to report or discuss negligent acts and practices of the appel-lee when such acts could and would have presented a substantial risk of danger to the health and safety of the public, such covenant being founded upon considerations of public policy and the manifest representations of the appellee.”

Campbell claims that the trial court improperly determined the non-existence of the covenant, an alleged question of fact. In his brief, Campbell grounds the presence of this alleged covenant upon three footings.

Campbell states the proposition that the alleged covenant is founded upon public policy but has cited no authority in contract law supporting that assertion. We have considered, and rejected, Campbell’s theory that a general public policy exception to the at will employment rule exists to support his cause of action for retaliatory discharge sounding in tort, and we find no similar public policy to support his contention that such implies a covenant in his employment agreement.

Campbell claims he was denied procedural due process. Although he has waived consideration of this contention by raising it for the first time on appeal (A.P. 8.3(A)(7)) we nonetheless note that the argument is without merit. He has not demonstrated the existence of a property interest protected by state law under statute, ordinance, or contract, as is required. McQueeney v. Glenn, (1980) Ind.App., 400 N.E.2d 806.

Finally, Campbell claims that the trial court erred in granting summary judgment for Lilly, because the provisions of the personnel manual which were submitted to the court created a genuine issue of material fact as to the existence of the alleged covenant.

In Shaw, supra, the plaintiff, an at will employee, contended that an employee’s handbook issued by his employer, Kresge, set out the conditions of employment which both parties agreed to follow, and as such constituted a part of the contract of employment. The plaintiff alleged that his discharge was not effected in accordance with the disciplinary procedure outlined in the handbook, and as such constituted a breach of his employment contract. Kresge’s motion for summary judgment was sustained. The following statement by Judge Hoffman is appropriate to the case-at bar:

“Even assuming, arguendo, that the handbook relied upon by appellant constituted a part of the contract, in the absence of a promise on the part of the employer that the employment should continue for a period of time that is either definite or capable of determination, the employment relationship is terminable at the will of the employer. See: Pearson v. Youngstown Sheet and Tube Co. (7th Cir. 1974), 332 F.2d 439. There being no binding promise on the part of the employee that he would continue in the employment, it must also be regarded as terminable at his discretion as well. For want of mutuality of obligation or consideration, such a contract would be unenforcible [sic] in respect of that which remains executory. See: 1A Corbin, Contracts, § 152 (1963). See also: 1 Corbin, Contracts, § 96 (1963); 3A Corbin, Contracts, § 683 (1960).”

167 Ind.App. at 7, 328 N.E.2d at 781.

Thus, the covenant alleged to have existed by Campbell would be unenforceable even if found to exist. Campbell’s attempt to distinguish Shaw on its facts is unavailing. Here, the trial court in essence determined that the question of the covenant’s existence was not a material issue of fact. An issue of fact is material for purposes of a motion for summary judgment if it bears on the ultimate resolution of relevant issues. Stuteville v. Downing, (1979) Ind.App., 391 N.E.2d 629. Relevant here, assuming the truth of Campbell’s allegation that the.covenant exists, as we must, is the issue of its enforceability. The trial court did not err in determining that the covenant was unenforceable as a matter of law.

The trial court did not err in granting Lilly’s motion for summary judgment in this cause.

Affirmed.

YOUNG, P. J. (participating by designation), concurs. RATLIFF, J., concurs in part, dissents in part, and concurs in result with opinion.

1 . We note at the outset that Campbell, in preparing his appeal, ignored the clear mandate of Ind. Rules of Procedure, Appellate Rule 8.3(A)(4) by failing to include in his statement of the case a brief indication of the nature of the case and a verbatim statement of the judgment. Campbell additionally failed to include a summary of argument, as required by A.R. 8.3(A)(6). Although this is careless appellate practice, the inadequacies are not so substantial as to require summary affirmance of the trial court’s judgment, and we shall consider this appeal on the merits.

2 . Ind. Code 22-3-2-15.