Ruffner v. Ken Blanchard Companies, Inc.
ORDER granting 25 Motion for Summary Judgment. The Clerk of Court is directed to enter judgment in favor of Blanchard and against Ruffner and close the case file. Signed by Judge Donald W. Molloy on 11/30/2017. (NOS)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MONTANA
NOV 3 0 2017
Clerk, U.S District Court
District Of Montana
KEN BLANCHARD COMPANIES,
In June 2016, Plaintiff Laurie Ruffner ("Ruffner") sued her former
employer, Ken Blanchard Companies, Inc. ("Blanchard"), in the Montana TwentyFirst Judicial District Court, Ravalli County, alleging wrongful discharge from
employment (Count I) and interception of wire and electronic communications
(Count II). (State Compl., Doc. 3.) In August 2016, Blanchard removed the
action to this Court, (Doc. 1), and Ruffner subsequently amended her complaint to
proceed solely on a claim for wrongful discharge under the Montana Wrongful
Discharge from Employment Act, MCA§§ 39-2-301, et seq. (See Amend.
Compl., Doc. 28). Blanchard seeks summary judgment. (Doc. 25.) After
considering the parties' briefing and oral argument, the motion is granted.
The facts as outlined below are undisputed, (see Fact Statements, Docs. 27,
38), or viewed in the light most favorable to Ruffner, Tolan v. Cotton, 134 S. Ct.
1861, 1866 (2014) (per curiam).
Blanchard is a management training and consulting firm. Ruffner was
employed at Blanchard from approximately June 16, 1996 until April 18, 2016.
Her last position was Director of Client Solutions. In that position, Ruffner's job
responsibilities included sales for Blanchard's products and services and related
customer service and account management duties. During her twenty years,
Ruffner was an exemplary employee who routinely received positive feedback on
her performance. However, Ruffner did not meet her annual budget sales revenue
goal for 2012, 2013, and 2014. In April 2015, she was not on track to meet her
2015 goal. At that time, Gina Crosby, Ruffner's direct manager, instructed her to
develop a 90-day account development plan in order to achieve or exceed her
annual revenue goal. Ruffner was not the only employee to miss her sales goals
nor the only employee required to prepare a 90-day plan.
Although the parties dispute whether Ruffner ultimately met her 2015 goal,
on January 27, 2016, Crosby and Felicia Davey, Senior Human Resources
Director, presented Ruffner with a performance improvement plan ("PIP") that
addressed her failure to meet revenue goals in previous years and identified other
areas in which Crosby believed Ruffner needed to improve. Ruffner was the only
employee to receive a PIP, despite the fact that four of seven other employees in
Ruffner' s position failed to make their annual revenue goals for 2015. Because of
Ruffner's tenure with the company and Blanchard's concerns, Blanchard gave her
the option of severance pay if Ruffner did not want to meet the requirements of the
PIP. At the end of the January 27 meeting, Davey told Ruffner to take the next
couple days off to consider her options, which Ruffner did. Due to the timing of
this conversation, Ruffner did not attend the All Sales Meeting, which began the
following Monday. At that meeting, employees gossiped about the status of
Ruffner' s employment.
On January 29, 2016, Ruffner communicated to Mark Manning, Senior Vice
President of Sales, North America, and Davey that she disagreed with the PIP and,
at the same time, made a counteroffer as to severance. On February 4, 2016,
Manning sent Ruffner an email supporting the PIP and indicating her severance
request was too high. Ruffner responded that she did not oppose a PIP, but
believed "the one presented was set up for failure" and she was "not opposed to a
plan that is reasonable, allows [her] to serve [her] clients and is obtainable." (Doc.
38, ~ 20.) Blanchard allowed Ruffner to remain on administrative leave through
March 11, 2016, while she reviewed a subsequent severance offer. On March 8,
2016, Blanchard received a letter from Ruffner's attorney with another
counteroffer to Blanchard's proposed severance agreement, and on March 9, 2016,
Ruffner asked for additional time off through March 16, which was approved.
On March 10, 2016, Blanchard sent a letter to Ruffner' s attorney indicating
she should plan to return to work on March 16. On March 16, Ruffner' s attorney
sent Blanchard a letter stating Ruffner would not return to work unless several
conditions were met. Those conditions were that: (1) the PIP be removed, (2) her
accounts returned to her in the same form they existed prior to her leave, (3) her
2016 quota adjusted from $1. 6 million to $1.4 million, (4) management correct an
issue related to employees stating Ruffner had been terminated, (5) she be trained
in certain processes and procedures for newly launched system, ( 6) Blanchard not
adjust, change, alter, or remove any of her sales territory in any way, and (7)
Blanchard pay for all client-related travel expenses. On March 18, Blanchard
responded, stating that Ruffner could return to work on March 21 and that it was
willing to meet most of her conditions, except a PIP would remain in place and it
could not guarantee her client list indefinitely. On March 21, Ruffner's attorney
rejected Blanchard's offer, demanding the PIP be removed and seeking other
clarification. Blanchard responded on March 24 with further clarification and
indicated that Ruffner would need to return to work after March 31. On March 30,
Ruffner's attorney once again rejected Blanchard's offer, writing, "Ms. Ruffner
will return to work on the condition there is no PIP." (Doc. 38 at ,-r 33.)
While Ruffner was on leave, service to her client accounts was disrupted
and other Blanchard employees were burdened with handling her accounts in
addition to their own work. On April 8, 2016, Blanchard sent another letter to
I understand you have stated that you will not return to work under any
type of PIP. As an extraordinarily unusual accommodation to you, we
will hold in abeyance the PIP that was previously provided to you, with
the understanding a PIP will be put in place no later than May 1, 2016.
Please know that we intend to work with you in good faith, with the
assistance of an internal Executive Coach, to make some adjustments to
the PIP, including the revisions we have already told you we would do,
so that you feel better about it.
(Doc. 38-15.) The letter also states, "If you do not return to work on Monday,
April 18, 2016, we will consider you to have voluntarily resigned your position."
(Id.) Ruffner did not return to work by April 18, effectively ending her
employment. In 2015, Ruffner's salary with Blanchard was $134,510.00.
Since her employment ended, Ruffner applied for and accepted only one
position, a part-time executive director position with the Bitterroot Performing
Arts Council, earning $26,000 per year, which she started June 13, 2016. Ruffner
did not look for any jobs comparable to the position she held at Blanchard.
Although the amended complaint adequately pled constructive discharge as
to put Blanchard on notice, Ruffner's claim fails on the merits of the undisputed
facts. Additionally, Blanchard has shown that it had good cause to terminate her
employment as a matter of law and Ruffner does not present a pretext argument.
Consequently, summary judgment is appropriate, and it is not necessary to address
the parties' mitigation arguments.
A party is entitled to summary judgment if it can demonstrate that "there is
no genuine dispute as to any material fact and the movant is entitled to judgment
as a matter of law." Fed. R. Civ. P. 56(a). Summary judgment is warranted where
the documentary evidence produced by the parties permits only one conclusion.
Anderson v. Liberty Lobby, Inc., 4 77 U.S. 242, 251 (1986). Only disputes over
facts that might affect the outcome of the lawsuit will preclude entry of summary
judgment; factual disputes that are irrelevant or unnecessary to the outcome are
not considered. Id. at 248.
Blanchard argues that Ruffner can show neither that she was constructively
discharged nor that it lacked good cause to terminate her employment. Because
the undisputed facts demonstrate Blanchard is correct on both points, summary
judgment is appropriate.
In most cases under Montana's Wrongful Discharge Act, "the situation
presented is one where the employment was actually terminated by the employer."
Jarvenpaa v. Glacier Elec. Coop., 898 P .2d 690, 692 (Mont. 1995). The Act,
"however, also allows for those situations in which the employer has made
working conditions so intolerable that the employee is forced to quit-i.e., a
constructive discharge." Id. Montana law defines constructive discharge as "the
voluntary termination of employment by an employee because of a situation
created by an act or omission of the employer which an objective, reasonable
person would find so intolerable that voluntary termination is the only reasonable
alternative." MCA§ 39-2-903(1). Whether constructive discharge occurred is
"usually a question of fact determined by the totality of the circumstances."
Bellanger v. Am. Music Co., 104 P.3d, 1075, 1078 (Mont. 2004). "Summary
judgment should not be awarded when a factual controversy exists; whether an
employer's actions are wrongful and caused a plaintiffs resignation is generally
'for the trier of fact to decide."' Id. (quoting Jarvenpaa, 898 P .2d at 694 ).
Here, there are two issues related to constructive discharge; the first is
whether it was adequately pled, and the second is whether the facts alleged fail to
show constructive discharge as a matter of law.
In a civil action, the Federal Rules of Civil Procedure require only "a short
and plain statement of the claim showing that the pleader is entitled to relief."
Fed. R. Civ. P. 8(a)(2). "Although the rule encourages brevity, the complaint must
say enough to give the defendant 'fair notice of what the plaintiffs claim is and
the grounds upon which it rests."' Tellabs, Inc. v. Makar Issues & Rights, Ltd.,
551 U.S. 308, 319 (2007) (quoting Dura Pharms., Inc. v. Broudo, 544 U.S. 336,
346 (2005)). A complaint need not identify the "precise legal theory" nor include
an "exposition of [the plaintiffs] legal argument." Skinner v. Switzer, 562 U.S.
521, 530 (2011).
Here, Ruffner's Amended Complaint does not mention constructive
discharge and takes the position that Blanchard terminated Ruffner, not that
Ruffner voluntarily resigned. It states that "[o]n April 19, 2016, Blanchard
terminated Ms. Ruffner's employment without explanation or good cause, instead
mischaracterizing the termination as a 'voluntary resignation.'" (Doc. 28
3(q).) And, Count One alleges: "Ms. Ruffner was terminated in violation of the
Montana Wrongful Discharge From Employment Act, §39-2-901, et seq., MCA.
Specifically, Ms. Ruffner was terminated without good cause and in violation of
Defendant's employment policy." (Id. at 6.) However, the Amended Complaint
outlines in detail the parties' dispute over the PIP and the conditions upon which
Ruffner would return to work. It explains that she would not return to work under
the PIP proposed by Blanchard and, as a result, was terminated. While it fails to
identify the precise legal theory, it contains a sufficient "short and plain statement"
to give Blanchard notice of a potential constructive discharge theory. Skinner, 562
U.S. at 530; Tellabs, 55 l U.S. at 319.
Blanchard further argues that Ruffner was not constructively discharged as
a matter of law. Ruffner, on the other hand, insists that her decision not to return
to work under the terms of Blanchard's offer was, in effect, a forced resignation.
Consideration of the totality of the circumstances here precludes a finding of
Montana law provides useful guidance in the context of forced retirement.
"[W]here an employer tells an employee to resign or be fired, the resignation can
be a constructive discharge." Jarvenpaa, 898 P.2d at 692. "[T]he threshold
factual issue of whether the employee's termination is voluntary or involuntary
should be submitted to the factfinder." Id. at 693. However, an offer of early
retirement in lieu of termination "does not by itself constitute constructive
discharge." Id. And, "[e]arly retirement is not a discharge ifthe employee has the
power to choose to keep working." Id. If returning to work is an option, the
question is whether doing so "will result in work so arduous or unappealing, or
working conditions so intolerable, that a reasonable person would feel compelled
to forsake his job rather than submit to looming indignities." Id. (quoting Vega v.
Kodak Caribbean, Ltd., 3 F.3d 476, 480 (1st Cir. 1993)).
In Childress v. Darby Lumber Inc., this Court granted summary judgment to
an employer under a constructive discharge theory. 126 F. Supp. 2d 1310, 1319
(D. Mont. 2001 ). In addressing claims under the Worker Adjustment Retraining
and Notification Act ("WARN"), this Court explained:
Determination whether conditions are intolerable is normally a question
for factfinders. However, even if conditions of the reassignment from
heavy equipment operator to log landing worker are viewed in a light
most favorable to [the employee], it does not rise to the level of
constructive discharge here. Here [the employee] anticipated that
conditions would be intolerable at the log landing without ever actually
arriving at the site to find out what the conditions would be. Given the
range of jobs that [the employer] had remaining for its employees,
reassignment of [the employee] to work at a log landing was not
unreasonable. Plaintiffs note that [the employee] had safety and training
concerns about working at the log landing. A reasonable alternative to
quitting could certainly have been refusing to perform certain tasks until
safety measures were put in place and he was given the proper training.
However, [the employee] never arrived at the landing and never
discovered if proper training and safety measures would be in place. A
totality of the circumstances test here indicates that [the employee]'s
speculation about potential intolerable situations is not enough to
warrant a finding of constructive discharge. . . . Consequently,
Defendants are entitled to summary judgment regarding claims of [the
employee] under the WARN Act because he voluntarily departed from
Id. at 1319 (internal citations omitted).
The facts here are more analogous to Childress than Jarvenpaa. While
Blanchard offered Ruffner a severance option, she also had the option to return to
work. Ruffner must therefore raise a genuine issue of material fact as to whether
doing so "w[ould] result in work so arduous or unappealing, or working
conditions so intolerable, that a reasonable person would feel compelled to forsake
h[er] job rather than submit to looming indignities." Jarvenpaa, 898 P.2d at 693
(internal quotation marks omitted). She fails to do so. Instead, the undisputed
facts show that her return to work had been accommodated by her employer.
Ruffner argues that returning to work under the terms of the PIP would be
so onerous as to make her job intolerable. She insists that unlike Childress, her
knowledge of her job before the PIP makes her fear of her increased duties and job
conditions under it a certainty, not speculation. But, it is undisputed that Ruffner
never returned to work to assess the truth of her speculation about working under
the PIP being intolerable by any reasonable standard. It is also undisputed that
Blanchard agreed to almost all ofRuffner's other conditions for her return to
work, agreed to work with Ruffner and an executive coach to modify the PIP, and
agreed to hold the PIP in abeyance. (See Doc. 38-15.) The "certainty" Ruffner
claims ignores Blanchard's undisputed offer of accommodations. She further
argues that her co-workers gossiped about her alleged termination; however, there
is no indication such activity would prevent her from performing her job.
Had Ruffner returned to work, the PIP remained un-modified, her sales
areas taken away, and her co-workers no longer possible to work with, her claim
could have presented a jury question. But, Ruffner's speculation as to the
intolerability of her potential working conditions does not raise a genuine issue of
material fact as to constructive discharge. Ruffner was told she could return to
work, but she chose not to. The undisputed facts, viewed in the light most
favorable to Ruffner, fail to show "an objective, reasonable person would find"
that her decision was "the only reasonable alternative." See§ 39-2-903(1).
Accordingly, summary judgment is granted in favor of Blanchard as to Ruffner's
constructive discharge claim.
Blanchard further insists that it had good cause to terminate Ruffner. "A
discharge is wrongful if it is not for good cause." Davis v. State, Dep 't ofPublic
Health & Human Servs., 357 P.3d 320, 322 ~ 10 (Mont. 2015). An employer has
"good cause" to discharge an employee if it had "reasonable job-related grounds
for dismissal based on a failure to satisfactorily perform job duties, a disruption of
the employer's operation, or other legitimate business reason." Mont. Code Ann.
§ 39-2-903(5). "A legitimate business reason is one that is 'neither false,
whimsical, arbitrary or capricious, and it must have some legal relationship to the
needs of the business." Becker v. Rosebud Operating Servs., Inc., 191P.3d435,
441 (Mont. 2008) (quoting Kestell v. Heritage Health Care Corp., 858 P.2d 3, 7
(Mont. 1993)). 1 Summary judgment is appropriate "where there are facts not in
dispute that provide 'good cause' for discharge from employment." Davis, 357
P.3d at 322. Blanchard argues it had good cause to terminate Ruffner because she
failed to report for work at the end of her official leave period on April 18, 2016.
Pursuant to Blanchard's employee manual, "Blanchard will consider [an
employee] to have voluntarily terminated [her] employment if ... [she] fail[s] to
Employers have the broadest discretion in their personnel decisions if the
terminated employee is in a "sensitive managerial" position. Buck v. Billings,
Mont. Chevrolet, 811P.3d537, 541(Mont.1991). The discretionary power
outlined in Buck is not applicable here, however, as-despite her title as
Director- there is no indication that Ruffner was a manager or that her
termination was based on her role.
return from an approved leave of absence on the date specified." (Doc. 27-25 at
2.) Under Montana law, the failure to report for work can constitute good cause.
In Davis, the Montana Supreme Court affirmed summary judgment in favor of an
employer where the employee "repeatedly failed to report to work after her
confrontation with her immediate supervisor and did not obtain an excused
absence. She also refused to attend two meetings arranged to discuss her
concerns." 357 P.2d at 322. The situation here is similar.
Ruffner left work in February and did not return. Blanchard approved
extensions ofRuffner's leave, but ultimately set a final date upon which Ruffner
was required to report for work. Ruffner did not report. As mentioned above,
Ruffner' s primary disagreement with Blanchard was over the imposition of a PIP.
However, Ruffner does not dispute that Blanchard had the authority under its
Employee Manual to institute a PIP. (See Doc. 38-7 at 46.) Moreover, as
discussed in the context of constructive discharge, returning to work was a viable
alternative. Accordingly, Blanchard had good cause to terminate Ruffner's
employment when she refused to return.
Once an employer submits evidence of good cause, the employee may
submit evidence demonstrating either the reason for discharge was not "good
cause" or that the given reason, "is a pretext and not the honest reason for the
discharge." Becker, 191 P .3d at 443. To create an issue of fact regarding pretext,
the employee must provide more than "mere denial and speculation." Johnson v.
Costco Wholesale, 152 P.3d 727, ~ 28 (Mont. 2007). Here, Ruffuer did not
respond to Blanchard's pretext argument. However, at the motions hearing, her
argument veered into the land of pretext. She argued that given Ruffuer' s 20-year
history with the company, the PIP was merely meant to "paper the file," or lay the
groundwork for Ruffuer' s termination. Ruffner noted that after reviewing the PIP,
Manning stated: "I don't believe Laurie will be able to meet your expectations
even [if two requirements from the PIP are removed] and [if those requirements
are removed] the plan might seem more fair and reasonable." (Doc. 38-9 at 1.)
But, as conceded at oral argument, Ruffner did not and is not arguing pretext as a
legal theory. Even if she wanted to, she did not address it in her summary
judgment briefing, failing to meet her burden under the Wrongful Discharge Act.
See Becker, 191 P.3d at 443. Summary judgment is granted in favor of Blanchard
as to the question of pretext.
Violation of Written Personnel Policy
Although Ruffner alleges her discharge was in violation of Blanchard's
employment policy, (Doc. 28 at 6), she did not respond to Blanchard's motion for
summary judgment as to this theory. In the absence of any argument from
Ruffner, the Court cannot assess the merits of this theory as it is unclear what
provision of the policy may even be at issue. (See Blanchard's Brief in Support,
Doc. 26 at 12 (referencing imposition of the PIP) andRuffner's Amend. Compl.,
Doc. 28 at 5 (noting that the employee manual prohibits employees from gossiping
about one another).) Summary judgment is appropriate as to this issue. Cf L.R.
7 .1 (d)(l )(B)(ii) ("[F]ailure to file a response brief may be deemed an admission
that the motion is well-taken.").
Because Blanchard succeeds on the merits of its summary judgment motion,
the parties' arguments as to mitigation damages are not addressed.
Based on the foregoing, IT IS ORDERED that Blanchard's motion for
summary judgment (Doc. 25) is GRANTED. The Clerk of Court is directed to
enter judgment in favor of Blanchard and against Ruffner and close the case file.
-::1--JO day ofNovember, 2017.
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