Hall v. St. Jude Med. S.C., Inc.

326 F. Supp. 3d 770
CourtDistrict Court, D. Maine
DecidedAugust 20, 2018
DocketCase No. 17-cv-4222 (WMW/TNL)
StatusPublished
Cited by4 cases

This text of 326 F. Supp. 3d 770 (Hall v. St. Jude Med. S.C., Inc.) is published on Counsel Stack Legal Research, covering District Court, D. Maine primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Hall v. St. Jude Med. S.C., Inc., 326 F. Supp. 3d 770 (D. Me. 2018).

Opinion

Wilhelmina M. Wright, United States District Judge

After Defendant St. Jude Medical S.C., Inc., terminated Plaintiff Herbert H. Hall from his employment, Hall initiated this lawsuit, alleging retaliation in violation of public policy. Currently before the Court is St. Jude's motion to dismiss the amended complaint. For the reasons addressed below, the motion to dismiss is granted.

BACKGROUND

St. Jude, a Minnesota corporation that manufactures medical devices, hired Hall, a Michigan resident, as a sales representative in August 2014. The parties signed a two-year employment agreement that provides that, at the conclusion of the agreement, Hall would become an at-will employee and the other terms of the agreement would remain in effect. The agreement contains the following clause: "Governing Law. This Agreement will be governed by the laws of the state of Minnesota without giving effect to the principles of conflict of laws of any jurisdiction." The agreement also contains a forum selection clause:

Exclusive Jurisdiction. All actions or proceeding relating to this Agreement will be tried and litigated only in the Minnesota State or Federal Courts .... Employee submits to the exclusive jurisdiction *776of these courts for the purpose of any such action or proceeding, and this submission cannot be revoked. Employee understands that Employee is surrendering the right to bring litigation against [St. Jude] outside the state of Minnesota.

In October 2015, Hall became a clinical specialist, providing support to St. Jude customers for their use of certain medical devices sold by St. Jude. Hall routinely operated and serviced medical equipment for Dr. Abdul Alawwa, a Michigan doctor who purchased the majority of his medical devices from St. Jude. In October 2016, an employee at Dr. Alawwa's office asked Hall whether St. Jude would sponsor a party for Dr. Alawwa's office. Hall refused because of his concern that sponsoring a party would violate the Physician Payments Sunshine Act, 42 U.S.C. § 1320a-7h, and the Anti-Kickback Statute, 42 U.S.C. § 1320a-7b. Shortly thereafter, in response to St. Jude's recall of certain cardiac devices, Dr. Alawwa requested that a St. Jude employee access Dr. Alawwa's patient files to facilitate the recall notification process. Mitch Gilbert, an area sales representative who worked with Hall at St. Jude, ordered Hall to access Dr. Alawwa's patient files, but Hall refused to do because he believed that accessing the files would violate the Health Insurance Portability and Accountability Act (HIPAA), 42 U.S.C. §§ 1320d et seq.

Hall alleges that, after these events, Dr. Alawwa filed with Gilbert falsified complaints about Hall's work performance and Gilbert relayed those complaints to Hall's supervisors. St. Jude punished Hall for these complaints, Hall alleges, by declining to include him in a January 2017 training session. At a performance review shortly thereafter, Hall was advised that St. Jude was preparing to terminate his employment because clients had complained about his performance. On February 6, 2017, Hall's supervisor informed him that he would be placed on a "performance improvement plan" and that Hall's employment likely would be terminated within a month of completing the plan. Hall never received a performance improvement plan, and St. Jude terminated his employment on February 17, 2017.

Hall subsequently initiated this lawsuit in Michigan state court, alleging that St. Jude terminated him in retaliation for his refusal to violate the Physician Payments Sunshine Act, the Anti-Kickback Statute, and HIPAA, in violation of Michigan's public policy against retaliation. After St. Jude removed the lawsuit to the United States District Court for the Eastern District of Michigan, the lawsuit was transferred to the District of Minnesota and Hall amended his complaint to allege that St. Jude's retaliatory termination of his employment violated Minnesota law as well as Michigan law. Currently before the Court is St. Jude's motion to dismiss Hall's amended complaint for failure to state a claim on which relief can be granted.

ANALYSIS

I. State Law Governing the Retaliation Claim

Hall argues that the governing-law clause in the agreement requires the application of Minnesota law to the retaliation claim. St. Jude counters that the retaliation claim is not covered by the governing-law clause and that the Court must employ Minnesota's choice-of-law analysis to determine whether Michigan law or Minnesota law applies.

A. The Agreement's Governing-Law Clause Does Not Apply to the Retaliation Claim

Hall argues that his retaliation claim must be governed by Minnesota law because *777the claim falls within the agreement's governing-law clause. St. Jude counters that the governing-law clause is narrow and does not apply to the tort-based retaliation claim.

A federal court sitting in diversity applies the choice-of-law rules of the forum state-in this case, Minnesota1 -to determine whether to give effect to an agreement's governing-law clause. Fla. State Bd. of Admin. v. Law Eng'g & Envtl. Servs., Inc. , 262 F.Supp.2d 1004, 1012 (D. Minn. 2003) (applying Minnesota law). "Minnesota traditionally enforces parties' contractual choice of law provisions," Hagstrom v. Am. Circuit Breaker Corp. , 518 N.W.2d 46, 48 (Minn. Ct. App. 1994), but the specific language of a governing-law clause may limit that clause's reach to contract claims arising under the agreement, see Inacom Corp. v. Sears, Roebuck & Co. , 254 F.3d 683, 687-88 (8th Cir. 2001) (applying Nebraska law). A governing-law clause that "provide[s] that the contract will be 'governed by' or 'construed' under the laws of a particular state" is a narrow clause. Fla. State Bd. of Admin. , 262 F.Supp.2d at 1012. Because the clause at issue here provides that the agreement between Hall and St. Jude "will be governed by the laws of the state of Minnesota," the clause is narrow.

"[N]arrow choice of law provisions ... do not govern tort claims between contracting parties," id.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Cite This Page — Counsel Stack

Bluebook (online)
326 F. Supp. 3d 770, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hall-v-st-jude-med-sc-inc-med-2018.