the University of Texas at Austin v. Dijaira B. Smith

Opinion

ACCEPTED

03-14-00509-CV

3878566

THIRD COURT OF APPEALS

AUSTIN, TEXAS

1/23/2015 1:03:50 PM

JEFFREY D. KYLE

CLERK

No. 03-14-00509-CV

IN THE COURT OF APPEALS FILED IN 3rd COURT OF APPEALS

FOR THE THIRD JUDICIAL DISTRICTAUSTIN, TEXAS AUSTIN, TEXAS 1/23/2015 1:03:50 PM ______________________________ JEFFREY D. KYLE Clerk

THE UNIVERSITY OF TEXAS AT AUSTIN Appellant

v.

DIJAIRA B. SMITH

Appellee

______________________________

On Interlocutory Appeal from Cause No. D-1-GN-13-004318 in the 2OOth District Court of Travis County, Texas, Honorable Judge Amy Clark Meachum, Presiding

_________________________________

APPELLEE’S POST-SUBMISSION BRIEF

______________________________

JOHN JUDGE State Bar No. 11044500 JUDGE, KOSTURA & PUTMAN, P.C. The Commissioners House at Heritage Square 2901 Bee Cave Road, Box L Austin, Texas 78746 Telephone: 512/328-9099 Facsimile: 512/328-4132 Email: jjudge@jkplaw.com

Counsel for Appellee Dijaira B. Smith

ORAL ARGUMENT REQUESTED

IDENTITY OF PARTIES AND COUNSEL

Appellee Dijaira B. Smith certifies that the following is a list of all parties

and their counsel to the trial court’s judgment or order appealed from as required

by Texas Rule of Appellate Procedure 38.1(a):

Name of Party Name of Counsel 1. Plaintiff/Appellee John Judge Dijaira B. Smith State Bar No. 11044500 (“Di Smith”) JUDGE, KOSTURA & PUTMAN, P.C.

The Commissioners House at Heritage Square 2901 Bee Cave Road, Box L Austin, Texas 78746 Telephone: 512/328-9099 Facsimile: 512/328-4132 Email: jjudge@jkplaw.com

2. Defendant/Appellant Erika Laremont The University of Texas at Austin State Bar No. 24013003 (“UT-Austin”) Assistant Attorney General Office of the Attorney General General Litigation Division P.O. Box 12548 Austin, Texas 78711 Telephone: 512/463-2120 Facsimile: 512/320-0667 Email: erika.laremont@texasattorneygeneral.gov

ii

_______________

_______________

John Ju udge

State Bar B No. 11044500

The Commissionners Housee at Heritagge Square 2901 Bee B Cave R Road, Boxx L

Austinn, Texas 788746 Telephhone: 5122/328-90999 Facsimmile: 5122/328-41322 jjudgee@jkplaw.ccom

Counssel for Apppellee Dijaaira B. Smiith

iii

APPELLEE’S POST-SUBMISSION BRIEF

To the Honorable Court: Having obtained leave, Appellee files her post-

submission brief.

A. Introduction

Appellee’s citation to this Court’s opinion in Resendez v. TCEQ, 391

S.W.3d 312, 322 (Tex. App. – Austin 2012), and the Supreme Court’s more recent

reversal of that ruling, TCEQ v Resendez, ___ S.W.3d ___ (Tex. No. 13-0094,

Nov. 21, 2014), does not mean that the trial court’s denial of Defendant’s plea to

the jurisdiction must be reversed in this case. To the contrary, the Supreme

Court’s omission of certain facts from its per curiam opinion in TCEQ; facts that

Appellee argued were favorably parallel to material facts her facts in her case;

supports a conclusion that the Supreme Court’s opinion in TCEQ is materially

distinguished. More importantly, this case contains significant jurisdictional facts

that were not at all present in TCEQ; namely that the University of Texas, Office

of Internal Audit (OIA) is specifically mandated to investigate violations of

criminal law. Finally, a companion case handed down the same day as TCEQ

demonstrates that the Supreme Court is not a blind denier of all waivers of

sovereign or governmental immunity, as some government lawyers are wont to

urge. Dalmuth v. Trinity Valley Community College, ___ S.W.3d ___ (Tex. 13-

0815, Nov. 21, 2014).

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Accordingly, the Supreme Court’s surprise reversal of this Court’s ruling in

Resendez does not mandate reversal of the trial court’s denial of Defendant’s plea

to the jurisdiction in this case.

B. Investigative Authority

The statute provides a disjunctive definition of appropriate law enforcement

authority (ALEA) with four distinctive elements; that the reporter believed in good

faith the report recipient was a part of an entity authorized to:

1. Regulate under the law reported to have been violated; or

2. Enforce the law reported to have been violated; or

3. Investigate violations of criminal law; or

4. Prosecute violations of criminal law.

GOVT. CODE, §554.002 (b)

In this case the Office of Internal Audit is clearly authorized to investigate

violations of criminal law involving third parties, such as contractors and their

employees. This authority is spelled out in the Handbook of Operating Procedures.

It extends to all individuals having a business relationship with the university

outside of traditional employment; paid or unpaid; including, but not limited to,

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affiliations associated with research, visiting scholars, employees of contractors,

and volunteers. 1

Because the OIA is authorized to investigate violations of criminal law, it is,

objectively and indisputably, ALEA. The power to investigate violations of

criminal law, standing alone, is sufficient to make an entity ALEA. OAG v.

Weatherspoon, ___ S.W.3d ___, 2014 WL 2708759 (Tex. App. – Dallas No. 05–

13–00632–CV June 16, 2014). Plaintiff’s subjective belief, based primarily on the

auditors’ assurance that they were ALEA, was in fact and in law, objectively

reasonable.

C. Omitted Facts

In Resendez, this court put some weight on a supervisor’s taunt to the

whistleblowing reporter that if she believed that violations of law were occurring,

she should “report it to management.” Resendez, 391 S.W.3d at 327. The TCEQ

court did not find the taunting to be of significance. It is not mentioned in the per

curiam opinion, and is therefore immaterial to a proper analysis of the ALEA

definition in that case.

Now, the distinction between a supervisory taunt and an auditor’s

reassurance becomes critically significant. In this case the auditors assured Di

1 CR 323-26, Handbook of Operating Procedures, 3-1021, Suspected Dishonest or Fraudulent Activities

4

Smith that she was reporting to the proper authorities and that she was protected

under the Whistleblower Protection Act.2 She was encouraged to, and did in fact

report to people outside her immediate employer’s circle of influence; people who

had authority investigate violations of criminal law; to right wrongs; to do justice.

In contrast, the supervisor’s taunt in Resendez had the opposite effect. It

served to keep the institutional wrongdoing in house and under the rug. Confining

the reports of TCEQ crimes to TCEQ managers kept the damning information

away from authorities that could deal with the violations in the terms of the law.

Reporting TCEQ crime to TCEQ management would not protect the fisc in the

same way that reporting UIL crimes to internal auditors authorized to investigate

violations of criminal law would.

For the same reason that the supervisor’s taunt of Resendez is immaterial to

proper ALEA analysis in TCEQ, the auditors’ legally correct assurance that Smith

could safely spill the beans on her bosses is highly significant. It is a material fact

that mandates a finding and conclusion that sovereign immunity has been waived

in this case.

D. Okoli and Dalmuth

2 CR, 153, Id. p. 44, l. 6-17; CR, 179-180, Id. p. 70, l. 19-p. 71, l. 17

5

Read together with TDHS v. Okoli _____, ___ S.W.3d ___ (Tex. No. 10-

0567, 2014) and Dalmuth v. Trinity Valley Community College, ___ S.W.3d ___

(Tex. 13-0815, Nov. 21, 2014), TCEQ demonstrates that Di Smith’s reports to

UT’s internal auditors were made to ALEA, and are protected under the

Whistleblower Protection Act, GOVT. CODE. 554.001, et seq. Following the

Needham to Gentilello line of cases, the Okoli and TCEQ opinions reaffirm that

reports to internal authorities with powers to ensure agency compliance do not

constitute reports to ALEA.

These cases, however, do nothing to detract from a whistleblower’s legal

protection for reporting to an entity, whether internal or external, that has is

reasonably believed to possess investigative authority in criminal matters. The

objective reasonableness of Smith’s belief in the appropriateness of her report to

the Office of Internal Audit is proven through the free-standing criminal

investigative authority is bestowed by university policy, HOP 3-1021; established

under the Regents’ Rules, Rule 20201; which was adopted pursuant to statute,

Texas EDUC. CODE, §§ 65.11 et seq., and 51.352.

In Dalmuth the court observed that LOCAL GOVT. CODE, §§ 271.151(2) and

271.152, waive a local governmental entity’s immunity from suit for breach of a

services contract. The Court tersely dealt with each of the defendant’s arguments

that contrived to escape the clear and direct legislative waiver of immunity.

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First, “services” clearly includes what an employee provides his employer

by his efforts, and the statute waives immunity for claims under contracts for

services. Second, although the specific LOCAL GOVT. CODE sub-chapter involved

is entitled, “Acquisition, Sale, or Lease of Property, … [t]he heading of a title,

subtitle, chapter, subchapter, or section does not limit or expand the meaning of a

statute.” Thus, the ordinarily broad and general usage of the term ‘services’

includes any act performed for the benefit of another under some arrangement or

agreement whereby such act was to have been performed, citing Van Zandt v. Fort

Worth Press, 359 S.W.2d 893, 895 (Tex. 1962). Third, although the firefighters’

of earlier precedent were civil servants, treated differently from other employees in

some contexts, the law’s occasionally special treatment of civil service employees

says nothing about whether they should be treated differently under the Act.

Nothing in the Act itself indicates that its waiver of immunity is limited to suits by

civil servants.

Dalmuth proves that the Supreme Court can find a legislative waiver of

immunity when the legislature provides one. It simply will not lightly imply one

where it is not directly stated, or necessarily implied by clear legislative writ, and

supported in the facts of the case at issue. The lower courts’ dismissal of the case

pursuant to the employer’s plea to the jurisdiction was reversed, and without

hearing oral argument, remanded to the trial court.

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Likewise, L in n this case, the legislature has pplainly statted a waiveer of soverreign

immuniity for publlic employ yees who caan state a cclaim undeer Chapter 554 of thee

GOVERN NMENT COD DE.

“A public employee e who

w allegess a violatioon of this cchapter maay sue the employing state or loccal governm mental enttity for the relief provvided by thhis chapter. So overeign im mmunity iss waived annd abolisheed to the eextent of liiability for the relief allowed un nder this chhapter for a violationn of this chapter.” (eemphasis added)

GOVT. CODE, §554 4.0035

The T trial co ourt has pro

operly foun

nd the OAII to be ALE

EA. It hass the free

standing g authority y, and a maandate to in

nvestigate violations of criminaal law

involvin ng financiaal impropriiety.

E. Conclusion C n

The T trial co ourt’s deniaal of Defen

ndant’s pleea to the jurrisdiction sshould be

upheld.

Respectfully subbmitted,

_______________

_______________

John Ju

udge

State Bar

B No. 11044500

8

The Commissionners Housee at Heritagge Square 2901 Bee

B Cave R Road, Boxx L

Austinn, Texas 788746 Telephhone: 5122/328-90999 Facsimmile: 5122/328-41322 jjudgee@jkplaw.ccom

Counssel for Apppellee Dijaaira B. Smiith

ERTIFICA CE ATE OF S

SERVICE

I herreby certify y that on th

he 18th day y of Decemmber, 20144 a true andd correct coopy of th he above an nd foregoinng Appelleee’s Post-SSubmission Brief was served onn all counnsel of recoord via elecctronic filing notice aas follows::

Erika Laremon nt Officce of the Attorney A General

P.O. Box 1254 48 Austtin, Texas 78711-254 48

John Juddge Counsel for Appelllee Dijairaa B. Smith

9

CERT

TIFICATE

E OF COM

MPLIANC

CE

This T Appelllee’s Post-Submissio on Brief coomplies witth the lenggth limitatioons

of Texaas Rule of Appellate A Procedure

P 9.4(i)(2) bbecause it ccontains 1,372 wordss,

excludin ng the partts exempteed by Rule 9.4(i)(l).

_____________________________

Johhn Judge Couunsel for A

Appellee Dijaira B. Sm

mith