King v. Marriott International, Inc.

866 A.2d 895, 160 Md. App. 689, 22 I.E.R. Cas. (BNA) 1651, 34 Employee Benefits Cas. (BNA) 2943, 2005 Md. App. LEXIS 7
CourtCourt of Special Appeals of Maryland
DecidedJanuary 27, 2005
Docket175, September Term, 2004
StatusPublished
Cited by25 cases

This text of 866 A.2d 895 (King v. Marriott International, Inc.) is published on Counsel Stack Legal Research, covering Court of Special Appeals of Maryland primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

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King v. Marriott International, Inc., 866 A.2d 895, 160 Md. App. 689, 22 I.E.R. Cas. (BNA) 1651, 34 Employee Benefits Cas. (BNA) 2943, 2005 Md. App. LEXIS 7 (Md. Ct. App. 2005).

Opinion

JAMES R. EYLER, J.

This appeal arises from a wrongful discharge action brought by Karen Bauries King, appellant, in the Circuit Court for Montgomery County, against her former employer, Marriott International, Incorporated, appellee. 1 Appellant contends that she was terminated from her position in appellee’s employee benefits department because she voiced objections to her co-workers and supervisor about the proposed transfer of funds from an employee Medical Plan (“Medical Plan or Plan”), qualified under ERISA, 2 to a general corporate account.

The circuit court entered summary judgment in favor of appellee on the grounds that (1) there is no viable wrongful discharge action under State law because termination of appellant’s employment did not violate a clear mandate of public policy; and (2) appellant’s State law claim is preempted by ERISA section 514(a). 29 U.S.C. § 1144(a). Appellant argues that these conclusions were erroneous.

We affirm the judgment of the circuit court on the ground that appellant failed to identify a sufficiently compelling public policy violated by the actions of appellee. In light of this conclusion, there is no State law claim to be preempted, and thus, no need to determine whether the doctrine of preemption applies.

FACTUAL BACKGROUND

For approximately ten years prior to her termination on March 22, 2002, appellant had been employed in various positions in appellee’s employee benefits department. In July 1998, Karl I. Fredericks (“Mr. Fredericks”) became Senior Vice President for Compensation and Benefits. Appellant, as *695 Director of Benefit Operations, reported to him, as did Ms. Maureen Brookbank (“Ms. Brookbank”), Vice President of Benefits Planning & Retirement Plans, and Ms. Sandra Kingsley (“Ms. Kingley”), Controller. In late 1998 or early 1999, appellant learned that Mr. Fredericks and the corporate accounting department planned to transfer funds from an employee Medical Plan reserve account to a general corporate account. Appellant, Ms. Brookbank, and Ms. Kingsley objected to the proposed transfer. Their objections were communicated to Mr. Fredericks. Apparently, no funds were transferred at that time.

In the summer of 1999, Mr. Fredericks reorganized the employee benefits department. As part of that reorganization, Ms. Kingsley voluntarily terminated her employment with appellee. Additionally, on September 11, 1999, Mr. Fredericks promoted appellant to Vice President of Benefit Resources, which included responsibility for employee benefits accounting. During the reorganization, Mr. Fredericks also changed the duties and responsibilities of Ms. Brookbank.

In the fall of 1999, appellant learned that the proposal to transfer funds from the benefits Plan was again being discussed. From October to December, 1999, appellant voiced her objections, verbally and by e-mail, to Mr. Fredericks and to appellee’s in-house counsel in charge of employee benefits and compensation issues, Mr. Edward Rosie (“Mr. Rosie”). Appellant believed that the proposed transfer constituted the “illegal” use of Plan assets for corporate purposes. Transfer of the funds, she asserted, would also result in fewer “premium holidays” or “benefits bonuses,” which enabled Plan participants to not pay premiums for a certain period of time, during which the cost of their benefits would be paid with Plan assets.

On December 10, 1999, Mr. Fredericks presented appellant and Ms. Brookbank with memoranda indicating that their job performance was unsatisfactory. 3 The memoranda referenced *696 an inability by the addressees to work together and indicated that, absent immediate substantial change, adverse employment actions would be taken.

Near the end of 1999, appellee transferred approximately $7.3 million from the Medical Plan reserve account, regarded by in-house counsel as non-Plan assets and “excess reserves,” to a general corporate reserve account. Appellant did not have any prior knowledge of the transfer, did not approve the transfer, and did not participate in any way in the transfer of funds.

In early 2000, appellant heard that appellee proposed to utilize an additional sum of money from the Medical Plan reserve account to pay for consulting costs unrelated to the Plan. Again, appellant objected verbally and through e-mail to Mr. Fredericks.

On March 21, 2000, Mr. Fredericks terminated Ms. Brook-bank’s employment. On March 22, 2000, he terminated appellant’s employment. Mr. Fredericks stated he terminated the employment of both persons because of their inability to get along with each other and with the staff.

PROCEDURAL HISTORY

On March 21, 2001, appellant filed a complaint in the Circuit Court for Montgomery County against appellee and Mr. Fredericks, collectively the “defendants,” alleging wrongful discharge and defamation. Defendants removed the case to the United States District Court for the District of Maryland, asserting federal question jurisdiction. Appellant moved to remand the case. The federal district court denied the motion on the grounds that appellant’s allegations stated a cause of action under ERISA, and thus, the state law claims were completely preempted by ERISA section 514. 29 U.S.C. § 1132(a). 4

*697 Appellant filed an amended complaint, which included a claim for wrongful discharge under State law, but also contained additional counts, including an alleged violation of ERISA section 510. 5 29 U.S.C. § 1140. Defendants filed a *698 motion to dismiss the amended complaint. In denying defendants’ motion to dismiss, the federal district court revisited the question of whether appellant’s wrongful discharge claim was completely preempted by ERISA. The federal district deferred deciding the issue until after discovery.

Subsequent to discovery, defendants filed a motion for summary judgment. Defendants’ motion was granted. With respect to the counts alleging wrongful discharge and a violation of ERISA, the court granted defendants’ motion on the ground that there was no evidence to establish causation between appellants’ objections to the transfer of funds and termination of her employment.

Appellant appealed to the United States Court of Appeals for the Fourth Circuit, contending that the federal district court erred by concluding that her wrongful discharge claim was completely preempted by ERISA section 514, 29 U.S.C. § 1144 and, thus, by denying her motion to remand.

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866 A.2d 895, 160 Md. App. 689, 22 I.E.R. Cas. (BNA) 1651, 34 Employee Benefits Cas. (BNA) 2943, 2005 Md. App. LEXIS 7, Counsel Stack Legal Research, https://law.counselstack.com/opinion/king-v-marriott-international-inc-mdctspecapp-2005.