Sharel Farmer v. Eagle Systems and Services, In

Filing

UNPUBLISHED AUTHORED OPINION filed. Originating case number: 5:14-cv-00403-BR Copies to all parties and the district court/agency. [999876754].. [15-1124]

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UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT

No. 15-1124

SHAREL FARMER,
Plaintiff - Appellant,
v.
EAGLE SYSTEMS AND SERVICES, INCORPORATED; DATA SOLUTIONS &
TECHNOLOGY (DST), INC.,
Defendants - Appellees.

Appeal from the United States District Court for the Eastern
District of North Carolina, at Raleigh.
W. Earl Britt, Senior
District Judge. (5:14-cv-00403-BR)

Argued:

March 22, 2016

Decided:

July 1, 2016

Before WYNN and DIAZ, Circuit Judges, and DAVIS, Senior Circuit
Judge.

Affirmed by unpublished opinion. Judge Wynn wrote the opinion,
in which Judge Diaz and Senior Judge Davis joined.

ARGUED: Ralph Thomas Bryant, Jr., Newport, North Carolina, for
Appellant.
Justin N. Davis, MULLEN HOLLAND & COOPER, P.A.,
Gastonia, North Carolina; Jang Hwan Jo, SMITH, ANDERSON, BLOUNT,
DORSETT, MITCHELL & JERNIGAN, L.L.P., Raleigh, North Carolina,
for Appellees. ON BRIEF: Mario White, Clinton, North Carolina,
for Appellant. Kerry A. Shad, SMITH, ANDERSON, BLOUNT, DORSETT,
MITCHELL & JERNIGAN, L.L.P., Raleigh, North Carolina, for
Appellee Eagle Systems and Services, Incorporated; Nancy B.

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Paschall, MULLEN HOLLAND & COOPER, P.A., Gastonia, North
Carolina, for Appellee Data Solutions & Technology (DST), Inc.

Unpublished opinions are not binding precedent in this circuit.

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WYNN, Circuit Judge:
Plaintiff Sharell 1 Farmer contends that he engaged in an
activity
False

protected

Claims

Act

investigation,

by

the

(FCA)

he

anti-retaliation

when,

reported

in

a

the

single

provision

course

of

incident

an
of

of

the

internal
theft

of

government property from a warehouse operated by his employers.
Because Farmer’s report of theft was neither “in furtherance of
an

action

under”

the

FCA

nor

an

“effort[]

to

stop”

an

FCA

violation, 31 U.S.C. § 3730(h)(1), we affirm.
I.
Farmer

was

employed

by

Defendants

Eagle

Systems

and

Services, Inc. (Eagle Systems) and Data Solutions & Technology,
Inc. (DST) under a joint contract, and he was supervised by DST. 2
Defendants

are

federal

government

contractors

who

jointly

operate a supply warehouse.
In August 2012, Farmer witnessed warehouse supervisor Keith
Armstrong and his assistant steal government-owned night vision
goggles and convey them to a third person.
1

A few days later, at

According to counsel, Mr. Farmer’s first name is
“Sharell.”
The first name was initially misspelled in the
complaint, and an amended complaint was filed specifically to
correct the error.
The lower court docket was never corrected
to reflect the change, however.
2
We accept the facts Farmer alleged in his amended
complaint as true and draw reasonable inferences in his favor in
reviewing this dismissal for failure to state a claim. See E.I.
du Pont de Nemours & Co. v. Kolon Indus., Inc., 637 F.3d 435,
440 (4th Cir. 2011).
3

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the request of Eagle Systems Project Manager Roy Fischel, Farmer
wrote a statement reporting the theft he had witnessed.

After

receiving the report, Fischel disclosed Armstrong—the supervisor
who had committed the theft—the contents of the report and that
Farmer had authored it.
From
suffered

then

until

the
and

“persistent

day

Farmer

numerous

left

his

incidences

employment,
of

ridicule, threats, intimidation and harassment.”

he

retaliation,
J.A. 5.

His

supervisors isolated him from all other employees, stared at him
threateningly, and issued numerous disciplinary write-ups to him
“for

frivolous

Farmer

tried

management
intervene

and
to

teams
to

baseless

get

help

regarding

stop

it.

reasons.”

J.A.

from

the

the

mistreatment,

Farmer

Eagle

6–7.

eventually

Systems
they

found

this

Although
and

DST

did

not

working

environment unbearable and left his job in April 2013.
In

July

2014,

Farmer

filed

a

complaint

alleging,

inter

alia, that Defendants violated the anti-retaliation provision of
the FCA. 3

Defendants filed motions to dismiss under Federal Rule

3

Farmer also brought a claim for breach of non-delegable
duty under North Carolina common law, a negligence claim under
North Carolina common law, and a North Carolina civil conspiracy
claim. Farmer consented below to the dismissal of the breach of
non-delegable duty claim.
On appeal, we affirm the district
court’s dismissal of Farmer’s negligence claim because Farmer
has not cited, and we are not aware of, any North Carolina case
articulating a duty to keep an employee’s identity confidential
during internal investigations—the conduct undergirding this
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of Civil Procedure 12(b)(6).

Pg: 5 of 8

The district court granted the

motions and dismissed Farmer’s claims, mainly on the ground that
the reported theft was not a protected activity under the FCA’s
anti-retaliation provision.

Farmer timely appealed.
II.

We review a district court’s dismissal for failure to state
a claim de novo.

U.S. ex rel. Rostholder v. Omnicare, Inc., 745

F.3d 694, 700 (4th Cir. 2014).

“To survive a motion to dismiss,

a complaint must contain sufficient factual matter, accepted as
true, to ‘state a claim to relief that is plausible on its
face.’”

Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting

Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). 4

claim in Farmer’s complaint.
Moreover, the duty of reasonable
care generally applies when an individual’s conduct creates a
risk of “injury to the person or property of the other,” which
cannot be inferred here.
See Estate of Mullis by Dixon v.
Monroe Oil Co., 505 S.E.2d 131, 137 (N.C. 1998) (quoting Dail v.
Taylor, 66 S.E. 135, 136 (N.C. 1909)); see also Restatement
(Third) of Torts: Phys. & Emot. Harm § 7(a) (“An actor
ordinarily has a duty to exercise reasonable care when the
actor’s conduct creates a risk of physical harm.” (emphasis
added)).
We also affirm the district court’s dismissal of
Farmer’s civil conspiracy claim because, as Farmer concedes,
North Carolina law does not recognize such a claim as an
independent cause of action, see Toomer v. Garrett, 574 S.E.2d
76, 92 (N.C. Ct. App. 2002), and Farmer’s civil conspiracy claim
thus rises and falls with his FCA claim.
4
To state a claim under the FCA’s anti-retaliation
provision, a plaintiff need only satisfy the notice-pleading
standard under Rule 8(a) of the Federal Rules of Civil
Procedure, not the heightened pleading standard of Rule 9(b).
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Congress passed the FCA to discourage fraud against the
federal government by contractors.
F.3d

209,

213

includes

(4th

an

Cir.

See Glynn v. EDO Corp., 710

2013).

To

anti-retaliation

whistleblowers.

Id.

at

that

end,

provision

214.

That

the

statute

to

protect

provision

prohibits

retaliation against “lawful acts done . . . in furtherance of an
action”

under

provision

also

the

FCA,

and

protects

violations of” the FCA.

thanks

“other

to

a

efforts

2009
to

amendment,

stop

1

or

the
more

31 U.S.C. § 3730(h)(1); see Young v.

CHS Middle E., LLC, 611 F. App’x 130, 132–3 (4th Cir. 2015)
(unpublished).
retaliation

To

bring

provision,

a

a

successful

plaintiff

must

claim
show

under
three

the

anti-

elements:

“(1) he engaged in protected activity, (2) the employer knew
about the activity, and (3) the employer took adverse action
against him as a result.”

Smith v. Clark/Smoot/Russell, 796

F.3d 424, 433 (4th Cir. 2015).
At the heart of this appeal is the “protected activity”
element.

This Court has held that an act is protected under the

FCA when it “reasonably could lead to a viable FCA action.”
Mann v. Heckler & Koch Def., Inc., 630 F.3d 338, 344 (4th Cir.
2010) (quoting Eberhardt v. Integrated Design & Constr., Inc.,

See Smith v. Clark/Smoot/Russell, 796 F.3d 424, 433 (4th Cir.
2015).
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167 F.3d 861, 869 (4th Cir. 1999)).

Although this Court has not

yet articulated the precise scope of FCA-protected activity in
light of the 2009 “efforts to stop” amendment, see Smith, 796
F.3d at 434, 5 it is unnecessary to do so here.
a

single

report

of

theft,

without

any

It is clear that

facts

suggesting

an

underlying fraud, is not plausibly an act “in furtherance of an
action under” the FCA or an “effort[] to stop” an FCA violation.
31 U.S.C. § 3730(h)(1).
Farmer does not argue, nor could he, that the underlying
theft

he

reported

§ 3729(a)(1).
report

of

was

an

FCA

violation.

the

theft

Farmer

might

seeks

inventory

controls,

violation

is

have

indirectly

Eagle

Systems

U.S.C.

and

perhaps

to
the

draw

between

eventual

possible,

Farmer

prevented

future

While the speculative
his

report,

prevention
has

of

alleged

making that attenuated connection plausible.
U.S. at 678.

31

However, Farmer invites us to consider how his

fraudulent deliveries to the government.
connection

See

tighter
an

no

FCA
facts

See Iqbal, 556

In fact, Farmer’s complaint indicates only that an
manager

required

5

him

to

write

a

statement

Circuit courts have adopted different approaches to the
“protected activity” element in light of the 2009 amendment.
Compare Schell v. Bluebird Media, LLC, 787 F.3d 1179, 1187 (8th
Cir. 2015) (applying the same pre-2009 protected activity test),
with Halasa v. ITT Educ. Servs., Inc., 690 F.3d 844, 847–48 (7th
Cir. 2012) (suggesting that the amended FCA anti-retaliation
provision adds a new category of protected activities).
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reporting the theft and that he complied.

The complaint does

not allege facts that can plausibly demonstrate that he acted
“in furtherance of an action under” the FCA or undertook any
“efforts to stop” an FCA violation.

31 U.S.C. § 3730(h)(1).

III.
Even accepting all alleged facts as true and drawing all
reasonable inferences in Farmer’s favor, we cannot conclude that
Farmer’s activity here was protected by the FCA.

Therefore, we

affirm the judgment.
AFFIRMED

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