Stratton v. Arch Coal, Inc. et al

Filing 23

MEMORANDUM OPINION ORDER granting in part and denying in part 10 MOTION to Dismiss and 10 MOTION to Strike; granting the motion to dismiss as to Count II and Count IV, but denying it as to all other counts; denying the motion to strike. Signed by Judge Irene C. Berger on 5/26/2017. (cc: attys; any unrepresented party) (slr)

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF WEST VIRGINIA
BECKLEY DIVISION

JASON K. STRATTON,
Plaintiff,
v.

CIVIL ACTION NO. 5:16-cv-12204

ARCH COAL, INC., et al.,
Defendants.

MEMORANDUM OPINION ORDER

The Court has reviewed the Defendants’ Motion to Dismiss and Motion to Strike
(Document 10) and the Memorandum of Law in Support (Document 11), the Plaintiff’s Response
in Opposition to the Defendants, Arch Coal, Inc., Mingo Logan Coal Company, and Arch Coal
Group, LLC’s Motion to Dismiss and Motion to Strike (Document 12), and the Reply Brief in
Support of Defendants’ Motion to Dismiss and Motion to Strike (Document 14). The Court has
also reviewed the Plaintiff’s Complaint (Document 1-1) as well as all attached exhibits. For the
reasons stated herein, the Court finds that the Defendants’ motion should be granted in part and
denied in part.
FACTUAL BACKGROUND AND PROCEDURAL HISTORY
The Plaintiff, Jason K. Stratton, initiated this action by filing his complaint in the Circuit
Court of Raleigh County, West Virginia, on November 16, 2016. The Plaintiff named Arch Coal,
Inc., Mingo Logan Coal Company (“Mingo Logan”), and Arch Coal Group, LLC, as defendants.
1

The Defendants removed the matter to this Court on December 15, 2016, citing diversity
jurisdiction.
The Plaintiff alleges that he was employed by Arch Coal, Inc., on February 18, 1997, as a
dispatcher and that he consistently performed his duties in a safe and satisfactory manner always
meeting the Defendants’ expectations. On May 30, 2014, several of the Defendants’ employees
and vendors for Mingo Logan Coal Company were indicted for participation in a “pay-to-play”
scheme in which certain vendors paid illegal kickbacks to members of the company. The Plaintiff
claims that he cooperated with the FBI during the investigation of the “pay-to-play” schemes and
that the Defendants learned that he possessed voice recordings, notes, and photographs relevant to
the case. He also claims that the Defendants knew he intended to disclose that evidence and
testify against the Defendants if subpoenaed.
The Plaintiff contends that upon learning of his possession of this evidence and intent to
testify, the Defendants began scheduling him for fewer work shifts and ostracizing him while at
work. He alleges that the Defendants attempted to interfere with his marital relationship, and that
the Defendants’ actions caused him to develop Major Depressive Disorder. The Plaintiff was
allegedly placed on leave due to his medical issues1 on December 8, 2015. When he returned to
work on January 29, 2016, he was terminated from his position.
Mr. Stratton alleges in Count I of the complaint that he was terminated because of his intent
to testify against the Defendants and that his termination was wrongful and in violation of West
Virginia common law. In Count II, he claims that the Defendants entered into a civil conspiracy
and fraud in order to terminate his employment. Count III alleges that Mr. Stratton’s discharge

1 It is unclear from the Plaintiff’s complaint whether he took medical leave on the order of his doctor or if the
decision was solely that of the Defendants.

2

was retaliatory in nature and done in violation of substantial public policy preventing pay-for-play
schemes and preventing employers from intimidating employees in an effort to cover up bad acts.
Count IV alleges that the Defendants’ actions violate West Virginia statutes, and Count V alleges
that the Defendants discriminated against the Plaintiff based on a disability or a perceived
disability.
The Defendants filed their motion to dismiss and motion to strike on December 22, 2016.
The Plaintiff responded on January 4, 2017, and the Defendants replied on January 10, 2017.
Both motions are fully briefed and ripe for review.
STANDARD OF REVIEW
A. Motion to Dismiss
A motion to dismiss filed pursuant to Federal Rule of Civil Procedure 12(b)(6) tests the
legal sufficiency of a complaint. Francis v. Giacomelli, 588 F.3d 186, 192 (4th Cir. 2009);
Giarratano v. Johnson, 521 F.3d 298, 302 (4th Cir. 2008). “[T]he legal sufficiency of a complaint
is measured by whether it meets the standard stated in Rule 8 [of the Federal Rules of Civil
Procedure] (providing general rules of pleading) . . . and Rule 12(b)(6) (requiring that a complaint
state a claim upon which relief can be granted.)” Id. Federal Rule of Civil Procedure 8(a)(2)
requires that a pleading must contain “a short and plain statement of the claim showing that the
pleader is entitled to relief.” Fed. R. Civ. P. 8(a)(2).
In reviewing a motion to dismiss under Rule 12(b)(6) for failure to state a claim, the Court
must “accept as true all of the factual allegations contained in the complaint.” Erikson v. Pardus,
551 U.S. 89, 93 (2007). The Court must also “draw[ ] all reasonable factual inferences from those
facts in the plaintiff’s favor.” Edwards v. City of Goldsboro, 178 F.3d 231, 244 (4th Cir. 1999).
3

However, statements of bare legal conclusions “are not entitled to the assumption of truth” and are
insufficient to state a claim. Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009). Furthermore, the Court
need not “accept as true unwarranted inferences, unreasonable conclusions, or arguments.” E.
Shore Mkts., v. J.D. Assocs. Ltd. P’ship, 213 F.3d 175, 180 (4th Cir. 2000). “Threadbare recitals
of the elements of a cause of action, supported by mere conclusory statements, do not suffice…
[because courts] ‘are not bound to accept as true a legal conclusion couched as a factual
allegation.’” Iqbal, 556 U.S. at 678 (quoting Atlantic Corp. v. Twombly, 550 U.S. 544, 555
(2007)).
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.’” Iqbal, 556 U.S. at 678
(quoting Twombly, 550 U.S. at 570.) In other words, this “plausibility standard requires a plaintiff
to demonstrate more than ‘a sheer possibility that a defendant has acted unlawfully.’” Francis v.
Giacomelli, 588 F.3d 186, 193 (4th Cir. 2009) (quoting Twombly, 550 U.S. at 570.) In the
complaint, a plaintiff must “articulate facts, when accepted as true, that ‘show’ that the plaintiff
has stated a claim entitling him to relief.” Francis, 588 F.3d at 193 (quoting Twombly, 550 U.S.
at 557.) “Determining whether a complaint states [on its face] a plausible claim for relief [which
can survive a motion to dismiss] will ... be a context-specific task that requires the reviewing court
to draw on its judicial experience and common sense.” Iqbal, 556 U.S. at 679.
B. Motion to Strike
Rule 12(f) of the Federal Rules of Civil Procedure permits a district court to “strike from
a pleading . . . any redundant, immaterial, impertinent, or scandalous matter.” “Motions to strike
are a drastic remedy, often used by the movant as a dilatory tactic, and are therefore disfavored

4

and infrequently granted.” Jackson v. United States, No. CV 3:14-15086, 2015 WL 5174238, at
*1 (S.D.W. Va. Sept. 2, 2015) (Chambers, C.J.) (citing Waste Mgmt. Holdings, Inc. v. Gilmore,
252 F.3d 316, 347 (4th Cir. 2001)) (emphasis added). “Thus, to prevail on a motion to strike, the
movant must show that the challenged material ‘has no bearing on the subject matter of the
litigation and that its inclusion will prejudice the defendants.’” Id.
DISCUSSION
A. Counts I and III
The Defendants argue that Counts I and III of the Plaintiff’s complaint, alleging wrongful
termination and retaliatory discharge, both fail as a matter of law because the Plaintiff has failed
to set forth any substantial public policy of which the Defendants acted in contravention. The
Defendants contend that the Plaintiff cited no specific constitutional provision, statute, regulation,
or judicial opinion that sets forth any substantial West Virginia public policy, and by failing to
specifically plead any substantial public policy, the Plaintiff has failed to set forth a viable cause
of action. The Defendants also argue, alternatively, that Count I or Count III should be stricken
from the complaint as duplicative inasmuch as both allege wrongful retaliatory discharge in
contravention of public policy.
The Plaintiff counters that he has satisfied his burden of pleading a substantial public policy
in his complaint. The Plaintiff contends that he alleged in his complaint that the Defendants
violated West Virginia’s substantial public policy of preventing employees from intimidating
fellow employees in an effort to cover up their bad acts. The Plaintiff further argues that he
alleged the Defendants terminated his employment precisely because he had information and

5

intended to testify for the government concerning the bad acts of the Defendants, and he has
therefore satisfactorily pled a substantial public policy sufficient to survive a motion to dismiss.
With respect to the discharge of at-will employees, the West Virginia Supreme Court of
Appeals held in Harless v. First National Bank in Fairmont that “where the employer’s motivation
for the discharge [of an at-will employee] is to contravene some substantial public policy principle,
then the employer may be liable to the employee for damages occasioned by the discharge.” 246
S.E.2d 270, 271 (W.Va. 1978). In proving that an employee was discharged in contravention of
some public policy, the plaintiff employee has the burden of establishing that a substantial public
policy does actually exist. Roth v. DeFeliceCare, Inc., 700 S.E.2d 183, 190 (W.Va. 2010) (citing
Syl. Pt. 8, Page v. Columbia Natural Res., 480 S.E.2d 817 (W.Va. 1996)). Further, “[t]o identify
a substantial public policy, the Court looks to ‘established precepts in the State’s constitution,
legislative enactments, legislatively approved regulations, and judicial opinions.’” Id. (citing
Birthisel v. Tri-Cities Health Servs. Corp., 424 S.E.2d 606, 612 (W.Va. 1992)).
In Roth, the plaintiff was employed by the defendant DeFeliceCare and upon arriving at
work witnessed her employer engaging in sexual conduct with another female employee. Roth,
700 S.E.2d at 187. Upon returning from vacation after the incident, the plaintiff’s employment
was terminated and she subsequently filed a complaint alleging counts of wrongful termination
and retaliatory discharge in violation of a substantial public policy, among other counts. Id. at
188. The trial court dismissed the complaint for failure to state a claim, and the plaintiff employee
appealed. Id. The Supreme Court held that the trial court’s dismissal of the wrongful termination
claim was improper. Id. at 191. The Court found that the trial court failed to recognize a
substantial public policy in West Virginia against terminating an at-will employee for agreeing to

6

be a witness in other litigation involving the employer. Id. The Court held that “it is against
substantial public policy of West Virginia to discharge an at-will employee because such employee
has given or may be called to give truthful testimony in a legal action.” Id. at 192 (citing Page,
480 S.E.2d at 821). Therefore, because the plaintiff may have been able to ultimately prove that
her employment was terminated because she was willing to testify in other litigation concerning
what she witnessed, the Court found dismissal of the complaint was inappropriate. Id.
Similarly, in the case at hand, Mr. Stratton has alleged that he cooperated with investigating
officers in criminal investigations involving the Defendants and that he possessed evidence
relevant to the investigation, which he planned to disclose if subpoenaed. (Pl.’s Compl. at ¶ 1314.) Mr. Stratton alleges in Count I that he was wrongfully terminated in retaliation after the
Defendants learned of his cooperation and intent to testify against the Defendants, and that said
termination violated the substantial public policy against discharging an at-will employee. (Id. at
¶¶ 15-19, 25-26.) Mr. Stratton also alleges in Count III that, based on these same facts, his
discharge was retaliatory in violation of substantial public policies “in preventing the type and
manner of pay-for-play schemes that were in place at Defendants’ Mountain Laurel Complex” and
in “preventing employees from intimidating fellow employees in an effort to cover up their bad
acts.” (Id. at ¶¶ 36-37.) These allegations allow Mr. Stratton the opportunity to prove his
employment was terminated in violation of the substantial public policy against discharging an
employee who may be called to give truthful testimony or against substantial public policy of
preventing pay-for-play schemes supported by applicable criminal statutes. The Court finds that
the Plaintiff has satisfactorily alleged sufficient facts and a substantial public policy to state a
plausible claim for relief, and the Defendants’ motion to dismiss Counts I and III should be denied.

7

In seeking to strike Count I or Count III from the Plaintiff’s complaint, the Defendants
assert that both counts allege wrongful or retaliatory discharge, and that the Plaintiff cannot recover
twice for the same wrong or injury.
The Court finds that Counts I and III are not duplicative. The Plaintiff alleges in Count I
of his complaint that the Defendants wrongfully discharged him “in retaliation for information he
provided to both the FBI . . . . Plaintiff’s termination was wrongful and/or retaliatory in nature
and was in violation of West Virginia common law.” (Pl.’s Compl. at ¶¶ 25-26.) The Plaintiff
alleges in Count III that “there is a substantial public policy in preventing the type and manner of
pay-for-play schemes that were in place at Defendants’ Mountain Laurel Complex mine” and that
there is substantial public policy in preventing employees from intimidating fellow employees in
an effort to cover up their bad acts.” Further, the Plaintiff alleges that the Defendants wrongfully
discharged the Plaintiff “due to his cooperation with the FBI investigation into the illegal
activities” of the Defendants. (Pl.’s Compl. at ¶¶ 36-38.) These allegations on their face reflect
the violation of at least two different substantial public policies: preventing employers from
retaliatory discharge of an employee who may be called to give truthful testimony as established
by common law and preventing the type of pay-for-play schemes about which the Plaintiff
allegedly agreed to testify as supported by statute. Although the Plaintiff can only recover once
for the same retaliatory discharge if proven, the Court finds that Counts I and III of the Plaintiff’s
complaint are alternative counts rather than duplicative. Therefore, the Defendants’ motion to
strike should be denied.

8

B. Count II
The Defendants also move to dismiss Count II of the Plaintiff’s complaint.

The

Defendants contend that Count II alleges that the Defendants committed civil conspiracy and
fraud, but offers no factual or legal development of how the Defendants perpetrated fraud against
the Plaintiff. The Defendants, therefore, assert that Count II should be dismissed for failure to
state a claim.
The Plaintiff counters that Count II alleges sufficient facts to state the elements of the claim
of fraud and civil conspiracy. The Plaintiff contends that his complaint alleges that upon learning
of the Plaintiff’s cooperation with the FBI, the Defendants conspired to unlawfully discharge him
and to fraudulently state the reasons for his discharge. The Plaintiff argues that these facts support
his claim of fraud and civil conspiracy such that the Defendants’ motion to dismiss Count II should
be denied.
At the outset, the Court notes that it interprets Count II to allege a claim of civil conspiracy
wherein the Plaintiff claims that the Defendants entered into a conspiracy to commit a fraud against
him. The West Virginia Supreme Court has defined a civil conspiracy as “a combination of two
or more persons by concerted action to accomplish an unlawful purpose or to accomplish some
purpose, not in itself unlawful, by unlawful means. The cause of action is not created by the
conspiracy but by the wrongful acts done by the defendants . . . .” Dixon v. American Indus.
Leasing Co., 253 S.E.2d 150, 152 (W.Va. 1979). “In order for civil conspiracy to be actionable
it must be proved that the defendants have committed some wrongful act or have committed a
lawful act in an unlawful manner to the injury of the plaintiff.” Dunn v. Rockwell, 689 S.E.2d
255, 268-69 (W.Va. 2009). Further, “[a] civil conspiracy is not a stand-alone cause of action; it

9

is instead a legal doctrine under which liability for a tort may be imposed on people who did not
actually commit a tort themselves but who shared a common plan for its commission with the
actual perpetrators.” Id. at 269 (citing Kessel v. Leavitt, 511 S.E.2d 720, 754 (W.Va. 1998)).
Although the conspiracy itself does not give rise to the cause of action, in order to survive a motion
to dismiss, “the existence of a conspiracy must nonetheless be factually alleged to support a claim
of civil conspiracy.” Tucker v. Thomas, 853 F.Supp.2d 576, 594 (N.D.W. Va. 2012). “The
essence of a conspiracy is an agreement between two or more persons to accomplish an unlawful
purpose. Mere similarity of conduct by various persons and the fact that they have associated
with each other . . . is not necessarily sufficient to prove a conspiracy.” Precision Piping &
Instruments, Inc. v. E.I. duPont De Nemours & Co., 707 F. Supp. 225, 229 (S.D.W. Va. 1989).
Here, in support of his civil conspiracy claim, the Plaintiff alleges that the Defendants
“conspired with one another to deprive the Plaintiff of his employment with Defendants based
upon Plaintiff’s cooperation with the FBI investigation.” (Pl.’s Compl. at ¶ 31.) However, at no
point does the Plaintiff allege any agreement between the named Defendants wherein they attempt
to accomplish some purpose, lawful or unlawful. The Plaintiff specifically names Mingo Logan
Coal Company as the Defendant that terminated his employment, and alleges that he was
scheduled for fewer shifts and eventually terminated from his employment after Mingo Logan
learned of his evidence and intent to testify if subpoenaed. (Id. at 11-17.) However, the Plaintiff
fails to provide any factual basis to support the claim that the Defendants worked in concerted
action to accomplish his termination. Conclusory allegations are insufficient. Thus, Count II of
the Plaintiff’s amended complaint should be dismissed.

10

C. Count IV
Finally, the Defendants seek to dismiss Count IV of the Plaintiff’s complaint.

The

Defendants assert that Count IV, entitled “Violation of Statutes,” alleges that the Defendants’
actions violated the laws of West Virginia, but fails to state which laws or statutes the Defendants
violated and therefore alleges no facts or legal support for the Plaintiff’s complaint.

The

Defendants further assert that the only statutory provision cited by the Plaintiff in Count IV is
W.Va. Code §55-7-9, which is merely a jurisdictional statute. Thus, the Defendants contend that
the Plaintiff has failed to provide sufficient factual matter in Count IV to survive a motion to
dismiss. The Plaintiff counters that, when read with the rest of the complaint and viewed in its
entirety, Count IV satisfies the plausibility standard such that the Defendants’ motion to dismiss
should be denied. The Plaintiff contends that his complaint alludes to federal charges being filed
against individuals under the Defendants’ employ, and that those charges were the cause of the
Plaintiff’s termination in violation of state statutes.
As stated above, in order 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.’”
Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 570.). Further, Rule 8(a)(2) of the Federal
Rules of Civil Procedure requires “a short and plain statement of the claim showing that the pleader
is entitled to relief” which must “give the defendant fair notice of what the . . . claim is and the
grounds upon which it rests.” Twombly, 550 U.S. at 555. Here, Count IV of the Plaintiff’s
complaint has failed to put the Defendants on notice of what his claim is, much less articulate facts
that, when accepted as true, would show the Plaintiff is entitled to some relief. Count IV merely
states that the Defendants violated “aforesaid laws of West Virginia” in a manner that “confer

11

jurisdiction on this Court for an action of the Defendants pursuant to §55-7-9 of the West Virginia
Code.” (Pl.’s Compl. at ¶ 43.) The Plaintiff fails to allege any facts in Count IV to support the
Defendants’ violation of any statutes in a manner that gave rise to the Plaintiff’s claim for relief,
and further fails to set forth which statutes the Defendants’ alleged conduct violated. The Court
finds that Count IV of the Plaintiff’s Complaint should be dismissed.
CONCLUSION
WHEREFORE, after careful consideration, the Court ORDERS that the Defendants’
Motion to Dismiss and Motion to Strike (Document 10) be GRANTED in part and DENIED in
part. Specifically, the Court ORDERS that the motion to dismiss be GRANTED as to Count II
and Count IV, but DENIED as to all other counts. The Court ORDERS that the motion to strike
be DENIED.
The Court DIRECTS the Clerk to send a copy of this Order to counsel of record and to
any unrepresented party.
ENTER:

12

May 26, 2017