RENDERED: NOVEMBER 17, 2023; 10:00 A.M. NOT TO BE PUBLISHED
Commonwealth of Kentucky Court of Appeals
NO. 2022-CA-0575-MR
WILLIAM WINCHESTER APPELLANT
APPEAL FROM MCCRACKEN CIRCUIT COURT v. HONORABLE TIMOTHY KALTENBACH, JUDGE ACTION NO. 20-CI-00326
THE SALVATION ARMY, A GEORGIA CORPORATION; JOHN R. HORTON; AND MONICA HORTON APPELLEES
OPINION AFFIRMING
** ** ** ** **
BEFORE: ACREE, DIXON, AND JONES, JUDGES.
ACREE, JUDGE: Appellant William Winchester was terminated from his
employment with The Salvation Army (TSA) and subsequently sued Appellees,
TSA, John Horton, and Monica Horton for wrongful termination, retaliation,
defamation, and promissory estoppel. He appeals the McCracken Circuit Court’s April 8, 2022 Memorandum and Order granting summary judgment in favor of
Appellees. We affirm.
BACKGROUND
Appellant began working for TSA at its Paducah Corps1 as a “Corps
Accountant” on July 9, 2014. Appellees John and Monica Horton led the Paducah
Corps. The Paducah Corps’ operations include a church, a community center, a
food bank, and a thrift store.
The TSA’s Southern Territory Employee Manual explicitly states that
all employees are at-will except for those employees with a written contract.
Section 2.2 of the manual provides:
Employees voluntarily enter into their employment relationship with The Salvation Army, and accordingly are free to resign at any time, with or without cause or reason, with or without prior notice. Similarly, The Salvation Army may terminate an individual’s employment at any time, with or without cause or reason, with or without prior notice. This mutual relationship is called “employment at- will.” In accepting or continuing employment, employees agree that the relationship is and always has been strictly voluntary and at-will on both sides. Nothing in this manual, or in any other document issued by the Salvation Army or its representative(s), will alter this at-will relationship except a written contract for that express purpose, which is signed by both the employee and the Board of Trustees.
1 As Appellant notes in his brief, TSA is organized using a quasi-military structure. Its Kentucky and Tennessee division is subdivided into “corps,” and each corps is typically headed by a husband and wife team.
-2- Further, Section 15 of the manual states that “[i]n order to preserve the at-will
options of the organization and each employee, it is understood that the
employment relationship may be terminated with or without cause, at any time by
either party.” Appellant signed an acknowledgement form reflecting his
understanding of the at-will nature of his employment.
Section 3.14 of the manual, titled “Whistleblower Protections[,]”
states as follows:
If an employee has knowledge of, or concern about, illegal dishonest, or fraudulent activity, the employee is to contact his/her immediate supervisor or the Human Resources Department. The Salvation Army has a policy in place to protect individuals who are considered “whistleblowers”; for more information about the protections provided to whistleblowers, please see this policy. Managers and supervisors who become aware of reports of illegal and dishonest activities and/or violations of this policy through any means are obligated to promptly report this information to their supervisor (or up the chain of command as appropriate for the circumstances) and the Human Resources Department.
Appellant claims to have witnessed the Hortons violate Kentucky law
in multiple ways, including insurance fraud, fraudulent misrepresentation, theft by
deception, falsification of business records, and harassment. For instance, he
alleges the Hortons obtained an insurance check to make repairs after a hot water
heater ruptured and flooded the church and community center but did not use the
insurance funds to make repairs. He also alleges the Hortons obtained a grant for
-3- canteen repairs and for musical instruments but used most of the grant funds for
general operations. He claims John Horton regularly altered and falsified monthly
financial reports that Appellant had prepared in order to conceal the true financial
condition of the Paducah Corps, and that the Hortons took items donated to the
thrift store and sold the items for personal profit. He also alleges that management
at the thrift store helped halfway house residents smuggle stolen items into the
halfway house by generating false receipts for the stolen items.
Appellant began addressing his concerns with TSA in February 2019,
primarily by email. Appellant sent emails expressing his concerns to Lisa
Thompson, the human resources director for the Kentucky and Tennessee division
of TSA, and Sally Love, the Kentucky and Tennessee Personnel Secretary Captain.
On February 7, 2019, Appellant requested accommodations under the
Americans with Disabilities Act (ADA) based on his exposure to tobacco smoke.
Appellant and Thompson met in person regarding an unrelated matter and, during
that meeting, Appellant informed Thompson of his concerns regarding alleged
drug dealing, health and safety problems, and other issues. Thompson asked
Appellant to email her a list of the issues he raised. Appellant did so. He claims
he relied on the TSA Employee Manual’s protections for internal whistleblowers.
Appellant alleges that, after he raised concerns with Thompson, John
Horton falsely attributed errors affecting an annual audit to Appellant. The
-4- minutes of an April 11, 2019 Advisory Board meeting reflect that John Horton
discussed the status of an audit with the Board, informing board members that
items on the audit’s exception list were the result of coding errors in the general
ledger and that none of the exceptions were major issues. Appellant believes this
statement was meant to impugn his professional abilities as the Paducah Corps’
accountant, despite Appellant’s name not appearing in the meeting minutes.
He also alleges the Hortons lowered the “professional integrity” rating
in Appellant’s 2019 annual evaluation in retaliation for emailing Thompson.
However, Appellees note that, because Appellant’s score increased in a different
category of his annual evaluation, his overall score remained the same; Appellant
received a raise following his annual evaluation.
Regardless, Appellant submitted a retaliation complaint against the
Hortons by email to Thompson and Love on August 2, 2019. Ultimately, TSA
determined the Hortons had not violated any TSA policies. Thereafter, Thompson
wrote Appellant a letter dated September 6, 2019, wherein she assured Appellant
that no adverse employment action would be taken against him because of his
retaliation complaint. Appellant says he made further reports after receiving the
letter in reliance on Love’s assurance.
Appellant claims the Hortons initiated a campaign of further
retaliation against him after making his retaliation complaint. He also suspected
-5- further financial issues with the Paducah Corps, and so he began to compile
evidence of what he believed to show, among other things, falsification of business
records, fraud, and misappropriation of grant funds. He claims John Horton had
been altering or otherwise falsifying financial reports Appellant had created;
Appellant claims he sent the next financial report to John Horton in a format that
could not be altered, and that Horton made Appellant resend the report in a format
that John would be able to edit.
The TSA paid for the Hortons to travel to Israel for two weeks in
February of 2020. They placed the Paducah Corps’ youth director in charge during
their absence. Appellant claims the youth director had a problem with an
employee and, after contacting John Horton about what to do, Appellant and the
youth director spoke with the employee in John Horton’s unlocked office. Also
during the Hortons’ trip, an incident occurred during a youth activity; the youth
director was injured and Appellant assaulted. Appellant created an incident report;
upon the Hortons’ return to the country, Appellant claims John Horton insisted
Appellant change his incident report to remove criticism of the Hortons, but
Appellant refused to do so.
Appellant was terminated on March 23, 2020, with the stated reason
being “a violation of The Salvation Army policy – Ethics and Confidentiality.” He
claims the reasons for his termination – that he broke into John Horton’s office
-6- while the Hortons were in Israel and that he photocopied a confidential social
services client sign-in sheet – were pretextual. Appellant claims he was required to
enter the office in the past and that, at least twice, the Hortons instructed him to use
a screwdriver to open the locked office door. He also claims the office door was
not locked while the Hortons were abroad. He also claims that, although Appellees
say the sign-in sheet is confidential, it was hanging on a clipboard in a location that
anybody would be able to see it.
Appellant sued TSA itself, alleging wrongful termination in violation
of public policy, retaliation, and wrongful discharge and retaliation under a
promissory estoppel theory. He also sued the Hortons for defamation, libel,
slander, and conversion. On February 19, 2022, Appellant listed the factual
allegations supporting his lawsuit in an affidavit. On April 8, 2022, the circuit
court granted summary judgment on all claims except for conversion, which the
parties later resolved and filed a stipulation of dismissal. Appellant now appeals.
STANDARD OF REVIEW
A circuit court properly grants summary judgment “if the pleadings,
depositions, answers to interrogatories, stipulations, and admissions on file,
together with the affidavits, 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
-7- law.” CR2 56.03. “An appellate court’s role in reviewing a summary judgment is
to determine whether the trial court erred in finding no genuine issue of material
fact exist[ed] and the moving party was entitled to judgment as a matter of law.”
Feltner v. PJ Operations, LLC, 568 S.W.3d 1, 3 (Ky. App. 2018). Thus, appellate
courts review a circuit court’s grant of summary judgment motions de novo. Cmty.
Fin. Servs. Bank v. Stamper, 586 S.W.3d 737, 741 (Ky. 2019). However, “where
the movant shows that the adverse party could not prevail under any
circumstances” summary judgment is appropriate. Steelvest, Inc. v. Scansteel Serv.
Ctr., Inc., 807 S.W.2d 476, 480 (Ky. 1991). “[A] party opposing a properly
supported summary judgment motion cannot defeat that motion without presenting
at least some affirmative evidence demonstrating that there is a genuine issue of
material fact requiring trial.” Hubble v. Johnson, 841 S.W.2d 169, 171 (Ky. 1992)
(citing Steelvest, 807 S.W.2d at 480).
ANALYSIS
I. Wrongful Termination.
Appellant first argues the circuit court erred in dismissing his public
policy wrongful termination claim. He claims the circumstances of his termination
exempt him from the general prohibition against wrongful termination claims
brought by at-will employees. “[O]rdinarily an employer may discharge his at-will
2 Kentucky Rules of Civil Procedure.
-8- employee for good cause, for no cause, or for a cause that some might view as
morally indefensible.” Firestone Textile Co. Div., Firestone Tire & Rubber Co. v.
Meadows, 666 S.W.2d 730, 731 (Ky. 1983) (citations omitted). This is known as
the “terminable at-will” doctrine and is “a longstanding corollary to mutuality of
contract.” Gryzb v. Evans, 700 S.W.2d 399, 400 (Ky. 1985).
The Kentucky Supreme Court in Firestone identified three limitations
on any exception to the terminable at-will doctrine. See Firestone, 666 S.W.2d at
731-33. The Supreme Court more clearly listed these limitations in Gryzb: first,
“[t]he discharge must be contrary to a fundamental and well-defined public policy
as evidenced by existing law”; second, “[t]hat policy must be evidenced by a
constitutional or statutory provision”; and third, “[t]he decision of whether the
public policy asserted meets these criteria is a question of law for the court to
decide, not a question of fact.” Gryzb, 700 S.W.2d at 401.
The Supreme Court in Gryzb determined that two – and only two –
exceptions to the termination at-will doctrine exist where the “‘grounds for
discharging an employee are so contrary to public policy’” that a cause of action
exists even without “‘explicit legislative statements prohibiting the discharge.’”
Gryzb, 700 S.W.2d at 402 (quoting Suchodolski v. Michigan Consol. Gas Co., 316
N.W.2d 710, 711 (Mi. 1982)). Under the first – the refusal exception – the
employee must have been discharged because he failed or refused to violate the
-9- law while employed. Id. (quoting Suchodolski, 316 N.W.2d at 711). Under the
second – the protected activity exception – the employee must have been
discharged because of “‘the employee’s exercise of a right conferred by well-
established legislative enactment.’” Id. (quoting Suchodolski, 316 N.W.2d at 711).
Further, there must be a causal connection between the employee’s
protected activity and his subsequent termination: “in a non-civil rights wrongful
discharge case, a plaintiff must show ‘at a minimum that he was engaged in a
statutorily protected activity, that he was discharged, and that there was a
connection between the “protected activity” and the discharge.’” Mitchell v.
Coldstream Lab’ys, Inc., 337 S.W.3d 642, 645 (Ky. App. 2010) (quoting Follett v.
Gateway Reg’l Health Sys., Inc., 229 S.W.3d 925, 929 (Ky. App. 2007)). To
demonstrate a connection between a protected activity and the discharge, a plaintiff
must “show the protected activity was ‘a substantial and motivating factor but for
which the employee would not have been discharged.’” Follett, 229 S.W.3d at 929
(quoting First Prop. Mgmt. Corp. v. Zarebidaki, 867 S.W.2d 185, 188 (Ky. 1993)).
“As there is rarely a case where a plaintiff has a ‘smoking gun’ to prove improper
motive, a plaintiff must frequently ‘rely on circumstantial evidence and the
inferences that can be drawn therefrom to make his or her case.’” Id. (quoting
Willoughby v. GenCorp., Inc., 809 S.W.2d 858, 861 (Ky. App. 1990)).
-10- In Follett, we determined the circuit court erred in granting summary
judgment because there were genuine questions as to whether Follett was engaged
in statutorily protected activity, and as to whether this activity was a substantial
and motivating factor but for which she would not have been terminated. Id. at
932. Follett reported to her supervisor her suspicion that a physician was under the
influence of alcohol at work in or around March 2002, and cooperated with
investigative efforts in April and December of that year. Id. at 930. Follett
encouraged her staff to report suspected billing irregularities in the emergency
department in or around January 2003, and Follett cooperated with subsequent
investigations. Id. at 931.
Because KRS3 311.990(6) makes it a misdemeanor to impede a State
Board of Medical Licensure investigator in their administration of KRS Chapter
311, and because KRS 311.5954 empowered the Board to “suspend, limit, restrict,
or revoke the medical license of a licensee who either engages in unprofessional
conduct likely to harm the public, or becomes a chronic or persistent alcoholic[,]”
we determined there was a genuine question of material fact as to whether Follett’s
communication with the investigator was a statutorily protected activity; had she
3 Kentucky Revised Statutes. 4 The United States District Court held KRS 311.595 unconstitutional in Eubanks v. Stengel, 28 F. Supp. 2d 1024 (W.D. Ky. 1998). Regardless, it was effective at the time Follett was published, and provides a helpful analogy to the present case.
-11- not done so, she would have impeded an investigation in violation of KRS
311.990(6). Id. at 929-30. A further genuine question existed as to whether Follett
had engaged in statutorily protected activity because KRS 205.8465(1) requires
any person to report suspected violations of KRS 205.8451 et seq. – Kentucky’s
Medicaid fraud and abuse statute – and because KRS 205.8465(3) prohibits an
employer from discharging an employee who, in good faith, makes a report
required by KRS Chapter 205. Id.
In the case under review, Appellant avers in his affidavit that he
refused to falsify business records – conduct proscribed by KRS 517.050 – when
John Horton directed Appellant to modify an incident report to remove statements
critical of the Hortons. However, KRS 517.050 states that a person is only guilty
of falsifying business records where he exhibits “intent to defraud,” and the circuit
court concluded that the changes John Horton wanted Appellant to make would not
have constituted a violation of KRS 517.050 because the statute requires such
intent. We agree. Removal of references critical of the Hortons in an incident
report – a document internal to TSA – would not have demonstrated an intent to
defraud had Appellant actually modified the report at John Horton’s direction.
Our review reveals no other instance where Appellant refused to
engage in purportedly illegal activity when his employer directed him to do so. He
alleges in his affidavit that grant money requested for canteen repairs and musical
-12- instruments was spent otherwise, that insurance proceeds obtained to repair a water
line were not spent on that repair, and that John Horton told Appellant he planned
to obtain a grant for renovations by providing a reason other than renovations in
order to more easily obtain the funds. None of these allegations demonstrate
Appellant actually refused to engage in any illegal activity. Appellant also states
that John Horton instructed him to provide financial reports in a format that Horton
could edit; even assuming that John Horton did so in order to fraudulently
misrepresent the financial state of the Paducah Corps, Appellant did, as he admits,
provide the reports to Horton in an editable format. Presuming, arguendo, the
activity was illegal, Appellant’s mere observation or acquiescence in the activity
will not satisfy the refusal exception.
Regarding the protected activity exception, Appellant argues the
Kentucky Whistleblower Act, KRS 61.102 et seq., protects him from reprisal for
his internal complaints of suspected illegal or unethical actions at TSA. However,
“[t]he Kentucky Whistleblower Act protects public employees who report
perceived misconduct[,]” Workforce Development Cabinet v. Gaines, 276 S.W.3d
789, 791 (Ky. 2008) (emphasis added), and, therefore, does not apply to
Appellant’s employment with TSA. See also Vonderhaar v. AT&T Mobility
Servs., LLC, 372 F. Supp. 3d 497 n.16 (E.D. Ky. 2019), superseded by Vonderhaar
v. AT&T Mobility Servs., LLC, No. 2:17-CV-114 (WOB-CJS), 2019 WL 1120117,
-13- at *1 (E.D. Ky. Mar. 11, 2019), affirmed by Vonderhaar v. Waymire, 797 F. App’x
981 (6th Cir. 2020) (“Vonderhaar also lacks a right of action under Kentucky’s
whistleblower statute because that provision only covers public
employees, see KRS § 61.102, and the protection has not been extended to private
employees.”). The Kentucky Whistleblower Act is unlike the statutes in Follett
that granted Follett access to the protected activity exception because those statutes
encompassed Follett and her employment at the hospital. See Follett, 229 S.W.3d
at 929.
Because Appellant did not engage in any protected activity or refuse
to engage in conduct at the direction of his employer which would constitute a
violation of the law, we need not evaluate any claimed improper motive of the
Hortons. We conclude, therefore, the circuit court did not err in granting summary
judgment in favor of Appellees on Appellant’s wrongful termination claim.
II. Retaliation.
Second, Appellant challenges the circuit court’s summary judgment as
to his retaliation claim. Appellant invites us to expand the public policy exception
to wrongful termination, discussed supra, to include retaliatory conduct other than
outright termination. We decline this invitation. Further, we agree with Appellees
that, because Appellant did not present this argument to the circuit court, he failed
-14- to preserve this argument for this Court’s review. Accordingly, we will not disturb
the circuit court’s summary judgment on this issue.
III. Defamation.
Appellant next argues the circuit court erred in granting summary
judgment as to his defamation claim. According to Appellant, the Hortons made
defamatory statements about him during an April 2019 meeting of the Paducah
Corps’ Advisory Board. During the meeting, John Horton updated the Board
about an ongoing TSA audit. The meeting minutes reflect John Horton informed
the Board that coding errors in the Corps’ general ledger caused items to appear on
the audit’s exception list. He also stated that none of the cited exception items
were major, and Horton never mentioned Appellant by name. Regardless,
Appellant argues John Horton attributed the errors to Appellant and, therefore,
impugned Appellant’s skills as an accountant.
To prevail on a defamation claim, a plaintiff must establish each of
four elements: “‘(a) a false and defamatory statement concerning another; (b) an
unprivileged publication to a third party; (c) fault amounting at least to negligence
on the part of the publisher; and (d) either actionability of the statement
irrespective of special harm or the existence of special harm caused by the
publication.’” Toler v. Süd-Chemie, Inc., 458 S.W.3d 276, 282 (Ky. 2014)
(quoting RESTATEMENT (SECOND) OF TORTS § 558 (AM. L. INST. 1977)).
-15- However, to merely imply that an individual may have erred in their
job does not constitute defamation. “Speech is defamatory if it tends to ‘(1) bring
a person into public hatred, contempt or ridicule; (2) cause[s] him to be shunned or
avoided; or, (3) injure[s] him in his business or occupation.’” Doe v. Coleman,
436 S.W.3d 207, 210 (Ky. App. 2014) (quoting Yancey v. Hamilton, 786 S.W.2d
854, 858 (Ky. 1989)). As far as the minutes of the Advisory Board meeting reveal,
nothing John Horton said at the meeting rises to the level of defaming Appellant,
especially considering Horton noted that the issues were not major and never
mentioned Appellant by name. We, therefore, find no error in the circuit court
granting summary judgment on Appellant’s defamation claim.
IV. Promissory Estoppel.
Finally, Appellant argues the circuit court erred in granting summary
judgment on his promissory estoppel claim. Appellant asserts Appellees made
multiple promises that he would not experience negative consequences for
reporting perceived illegal or unethical acts. For instance, Appellant states in his
affidavit that Love told him he would experience no adverse employment
consequences for submitting his retaliation complaint. He also argues that the TSA
Employee Manual’s provisions safeguarding whistleblowers constitutes a promise
that he would not suffer reprisal for his internal reports.
-16- Under the doctrine of promissory estoppel, “‘[a] promise which the
promisor should reasonably expect to induce action or forbearance on the part of
the promisee or a third person and which does induce such action or forbearance is
binding if injustice can be avoided only by enforcement of the promise.’” Meade
Const. Co. v. Mansfield Com. Elec., Inc., 579 S.W.2d 105, 106 (Ky. 1979) (quoting
RESTATEMENT (SECOND) CONTRACTS, § 90 (AM. L. INST. 1981)). In this case,
Appellant began reporting perceived impropriety in February 2019, which was
months before Love told Appellant he would not experience adverse consequences
because of expressing his concerns to Thompson. Appellant says in his brief that
when Appellant and Thompson met in person to discuss Appellant’s ADA request
and his other concerns, Appellant relied on the provisions of the TSA Employee
Manual as a promise that he would not experience adverse employment effects due
to his emails to Thompson or his retaliation complaint. However, we find no case
law demonstrating that an employee manual can constitute a promise for the
purpose of a promissory estoppel claim. This case will not be the first unless a
higher court makes it so.
Thus, it cannot be said that any promise induced Appellant to act in a
manner he would not have acted otherwise. Accordingly, we find no error in the
circuit court’s decision to grant summary judgment on Appellant’s promissory
estoppel claim.
-17- CONCLUSION
For the foregoing reasons, we affirm the McCracken Circuit Court’s
April 8, 2022 Memorandum and Order.
ALL CONCUR.
BRIEFS FOR APPELLANT: BRIEF FOR APPELLEES:
William Winchester, pro se Megan R. U’Sellis Paducah, Kentucky Louisville, Kentucky
-18-