Lechnir v. Wells et al

Filing 33

ORDER signed by Chief Judge William C Griesbach on 6-29-15 granting in part and denying in part 16 Motion to Dismiss. (cc: all counsel) (Griesbach, William)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF WISCONSIN
THOMAS LECHNIR,
Plaintiff,
v.

Case No. 14-C-1020

RICHARD WELLS, et al.,
Defendants.

DECISION AND ORDER

Following the non-renewal of his employment contract, former University of WisconsinOshkosh baseball coach Thomas Lechnir filed this action contending that the non-renewal
constituted a violation of due process and retaliation. The Defendants moved to dismiss almost all
of the claims. For the reasons given below, the motion will be granted in part.

I. Background
Beginning in 2002, UW-Oshkosh began a campaign to renovate its sports complex. The
plan did not include renovation of the baseball field, however. Lechnir, the baseball coach,
proposed a new baseball stadium and offered to lead the fundraising efforts needed to finance it, and
Chancellor Richard Wells “begrudgingly” approved the project. (ECF No. 12 at ¶ 14.) During the
fundraising campaign, Lechnir raised some $668,000 in cash and in-kind donations.
According to Lechnir, personal animosity began infecting the university administration.
Chancellor Wells became upset with Lechnir because the funds Lechnir was raising were coming

from the same sources Wells hoped to tap for the sports complex renovations, crowding out Wells’
own efforts to raise money. According to Lechnir, Wells was also upset because Lechnir, who had
no official fundraising duties, was doing a better job fundraising than Wells, whose job as
chancellor entailed significant fundraising efforts. (Id. at ¶ 30.) According to the complaint, Vice
Chancellor of Student Affairs Petra Roter was a longtime ally of Wells who had come over with
Wells from Indiana State to work at Oshkosh, and she became allied with Wells against Lechnir.
In addition, Lechnir developed a poor relationship with Defendant Sims (whose role is not specified
in the complaint), accusing Sims of misappropriating funds. Thus, by 2012, Sims joined with Wells
and Roter to effectuate Lechnir’s departure from Oshkosh.
In April 2012, Wells told Lechnir that his “rolling horizons” contract would end in 2013 at
the expiration of his then-existing contract. It soon became clear that the reason for this action was
a debt of some $250,000 attributed to Lechnir’s stadium project. Lechnir asserts that he was
unaware of any debt due to his lack of involvement in anything other than the fundraising of the
project, and he describes the debt as a “phantom debt” incurred due to accounting practices rather
than any actual cost overruns with the stadium project. Defendants Roter and Wells claimed that
Lechnir would be able to keep his job if he raised enough funds to pay the debt off, but they
increased his fundraising targets in an effort (according to the complaint) designed to make Lechnir
fail.
The bad blood spilled over to Lechnir’s personnel evaluations, which until 2011 had always
been good. In his 2011 evaluation, he was criticized for missing two meetings and failing to do
paperwork, both items he believes were pretextual. In addition, Lechnir became puzzled by the
inconsistent evaluations he received, some of which indicated renewal of his contract while others,
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sometimes from the same reviewers, were marked “renewal not recommended.” (ECF No. 12 at
¶ 97.)
In May 2012 Chancellor Wells wrote to Lechnir to inform him that his contract would not
be renewed in 2013. In another letter offering further explanation, Wells cited “over $250,000 of
debt” on the baseball stadium; below-average academic performance of Lechnir’s student athletes;
timeliness of paperwork and meeting attendance; and community relations. (Id. at ¶ 104.) Lechnir
states that these were trumped-up performance issues, as evidenced by the fact that the
administration turned down a $40,000 per-year donation intended to pay off the debt and keep
Lechnir employed.
Eventually Lechnir was afforded an “ad hoc” peer review of the termination decision, with
a three-member staff committee hearing Lechnir’s assertion that nonrenewal was not warranted.
(Lechnir calls the committee a “kangaroo court”. (ECF No. 12 at ¶ 134.)) The committee found
itself unable to determine whether the grounds cited were sufficient cause for nonrenewal, so it
deferred the decision to the chancellor. Chancellor Wells reaffirmed his earlier decision and stated
he would not renew Lechnir’s contract. In doing so, Wells cited additional grounds, including
Lechnir’s inability to work cooperatively and his judgment relating to a student athlete. (Id. at 145.)
Lechnir sought review in Winnebago County Circuit court, which upheld the nonrenewal,
and then appealed to the state court of appeals. In a March 11, 2015 decision, that court affirmed,
finding no violation of due process nor any violation of other protected interests. Lechnir v.
University of Wisconsin-Oshkosh, 2015 WL 1034746 (Wis. Ct. App., March 11, 2015). The parties
have recently briefed the issue of claim preclusion resulting from the Plaintiff’s state challenge, and
so all matters raised by the pending motion are ripe for decision.
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II. Fourteenth Amendment Due Process
A. Claim Preclusion
As noted above, Lechnir challenged his nonrenewal through state administrative and judicial
proceedings. The Defendants argue that the state courts’ rulings preclude Lechnir from bringing
essentially the same claim in federal court. Wisconsin law, which governs the analysis, provides
that three factors must be present in order to preclude a later action: (1) identity between the parties
or their privies in the prior and present suits; (2) prior litigation resulted in a final judgment on the
merits by a court with jurisdiction; and (3) identity of the causes of action in the two suits. Froebel
v. Meyer, 217 F.3d 928, 933 (7th Cir. 2000). The earlier judgment is conclusive as to all matters
which were litigated or which might have been litigated in that proceeding. Wilhelm v. County of
Milwaukee, 325 F.3d 843, 846-47 (7th Cir. 2003). The Restatement of Judgments provides a
succinct explanation:
A given claim may find support in theories arising from both state and federal law.
When the plaintiff brings a claim in a court, either state or federal, in which there is
no jurisdictional obstacle to his advancing both theories or grounds, but he presents
only one of them, and judgment is entered with respect to it, he may not maintain a
second action in which he tenders the other theory or ground. If however, the court
in the first action would clearly not have had jurisdiction to entertain the omitted
theory or ground (or, having jurisdiction, would clearly have declined to exercise it
as a matter of discretion), then a second action in a competent court presenting the
omitted theory or ground should be held not precluded.
Restatement (Second) of Judgments, § 25 cmt. e.
Here, Plaintiff appealed through an ad hoc administrative proceeding, wherein a threemember staff committee reviewed his argument that the alleged deficiencies in his performance did
not warrant nonrenewal. When he lost that appeal, he petitioned for review in the state circuit court,
pursuant to Wis. Stat. § 227.53(1)(a)2m. He argues, based on Staats v. County of Sawyer, that claim
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preclusion does not apply because he could not have raised the federal claims he now raises in such
proceedings. 220 F.3d 511 (7th Cir. 2000). Defendants argue that not only could he raise his due
process in the state proceedings, but that Lechnir in fact did do so and is therefore precluded from
asserting it here. Whether Lechnir did or did not assert his due process claim in the state
proceedings makes no difference. The fact that he was free to do so is enough to preclude his
raising it here.
In Staats, the plaintiff filed a disability employment discrimination claim under the
Wisconsin Fair Employment Act (WFEA) with the State’s Equal Rights Division (ERD) of the
Department of Workforce Development. The Wisconsin Labor and Industry Review Commission
rejected his claims and the state court affirmed its decision. The plaintiff then brought claims in
federal court based on the federal Americans With Disabilities Act and the Rehabilitation Act. The
district court held that the federal claims were precluded by the state court action but the Seventh
Circuit reversed. The Seventh Circuit found no claim preclusion because the plaintiff could not
have filed his federal ADA claims with the ERD. “The [state] Equal Rights Division's jurisdiction
is limited; it can hear claims brought under WFEA but not the federal anti-discrimination statutes.
Even though in a free-standing case the Wisconsin state courts could have heard Staats's federal law
claims, the Equal Rights Division could not: it lacked jurisdiction to do so.” Id. at 516.
Staats does not apply here, however, because Lechnir could have asserted his due process
claim in the state proceedings. Under Wis. Stat. § 227.57(8) (titled “Scope of Review”), the court
“shall reverse or remand the case to the agency if it finds that the agency's exercise of discretion is
outside the range of discretion delegated to the agency by law; . . . or is otherwise in violation of a
constitutional or statutory provision.” Thus, the very statute that defines the scope of state court
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review provides that the state courts have the ability to grant the Plaintiff relief on constitutional
grounds. There is nothing within Chapter 227 that precludes the hearing of federal constitutional
claims.
In fact, in Omernick v. DNR, 100 Wis.2d 234, 248, 301 N.W.2d 437, 444 (1981), the
Wisconsin Supreme Court noted a “fundamental policy that parties to an administrative proceeding
must raise known issues and objections and that all efforts should be directed toward developing
a record that is as complete as possible in order to facilitate subsequent judicial review of the record
under sec. 227.20, Stats. That policy . . . requires that those constitutional issues be raised even
though the administrative agency is without power to decide them.” Thus, even if the administrative
agency lacked the power to decide constitutional issues, Lechnir was obligated to raise them in his
challenge.
In short, the holding of Staats, an employment discrimination case, does not apply here
because the rules governing Lechnir’s administrative challenge to the non-renewal decision and the
state court review of that decision did not preclude consideration of his federal constitutional claims.
In Staats, the plaintiff was “forced” (to use that court’s term) to split his claims between the state
and federal courts, whereas here the Plaintiff could have raised his constitutional challenges in the
state courts and arguably did. “[I]f there was a forum in which all claims arising out of the single
transaction could have been brought, and the plaintiff chooses a forum of limited jurisdiction
instead, then the plaintiff's other claims are barred by the doctrine of claim preclusion, because the
other claims could have been brought in the forum of general jurisdiction. If, on the other hand, no
such forum exists, and the plaintiff is forced to split her claims, a suit in one forum does not bar the
plaintiff from also bringing suit in another.” Staats, 220 F.3d at 516.
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This case is much closer to Froebel v. Meyer, where the Seventh Circuit found claim
preclusion when the plaintiff failed to raise a federal Clean Water Act challenge in his state
administrative proceedings. “There is no reason to think that Froebel could not have argued to both
the ALJ and the circuit court that the Wisconsin provisions . . . violated the federal Clean Water
Act. If he prevailed, then the Wisconsin courts would have concluded that WDNR's removal of
Funk's Dam was ‘otherwise in violation of a constitutional or statutory provision.’ That would have
offered a basis in law to modify the ALJ's decision and, under § 227.57(9), fashion appropriate
relief.” 217 F.3d 928, 936 (7th Cir. 2000). Accordingly, because the federal due process claim
could have been raised in the state review process, the claim is precluded.
B. Procedural Due Process
Even if the claim were not precluded, there is no reason to reach a different conclusion than
the state courts reached. The Defendants argue that the Plaintiff’s due process claim must fail
because he had no property interest in continued employment, given that his contract was to expire
in 2013. Lechnir concedes he had no property interest in a given contract, but argues that such an
interest can be created through implied promises, namely, the assurances he received from Sims,
Roter and Sonnleitner that his contract would be renewed if he demonstrated efforts to raise money
to pay off what he calls the phantom debt arising out of the baseball field construction.
“Absent an express agreement, an at will employee may still prove a property interest in his
or her employment under the second test if there is a ‘clearly implied promise in their continued
employment.’ In cases regarding at will employees, in order to demonstrate that there is an interest,
a plaintiff must show more than a ‘unilateral expectation’ or an ‘abstract need or desire’ for the
employment.” Phelan v. City of Chicago, 347 F.3d 679, 682 (7th Cir. 2003).
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Lechnir relies on a “fundraising plan” imposed on him by Sims, Roter and Wells as an
addendum to his December 2010 evaluation. Under that plan, Lechnir would sell naming rights and
signage, and have a phone-a-thon every spring. (ECF No. 12, ¶ 57.) The amended complaint also
alleges that Sims and Roter made “clear” that Lechnir’s job would be secure if he “worked towards
satisfying the phantom debt.” (Id., ¶ 58.) In light of these promises, Lechnir alleges he had a
reasonable expectation of continued employment, giving rise to a property interest.
Lechnir cites Vail v. Board of Educ. of Paris Union School Dist. No. 95, 706 F.2d 1435 (7th
Cir. 1983). There, a school board conveyed an offer to Vail, which included the Board's stated
intention to renew the one-year contract at the end of the first year. The Board made that statement
in response to Vail’s explicit concern about job security. “Vail was informed of the offer and told
that while the Board could not offer him more than a one year contract, it could assure him of
extending the contract for a second year. Vail accepted, traveled to Paris to execute a written
contract, and subsequently assumed the duties of athletic director and football coach.” Id. at 1436.
Before the year was up, the school board changed its mind and decided not to renew the contract.
The Seventh Circuit upheld the district court’s conclusion that a property interest had been created
by the board’s explicit promise to renew the contract for a second year, a promise that meant Vail
“had a two-year employment promise rather than a commitment for indefinite employment.” Id.
at 1438.
By contrast, in Valentine v. Joliet Tp. High School District No. 204, the court found no
property interest based on alleged oral assurances that the district would recall laid-off guidance
counselors on the basis of seniority. 802 F.2d 902, 988 (7th Cir. 1987). The court cited an earlier
case, McElearney v. University of Illinois, in which the plaintiff sued based on assurances from a
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department head that his progress was satisfactory. 612 F.2d 285 (7th Cir. 1979). The Valentine
court contrasted those kind of “informal assurances” with the “definite assurance” given by the
school board in Vail.
Even taking the complaint’s allegations as true, the only thing it alleges is that “Both Sims
and Roter made clear throughout the process that if Lechnir worked towards satisfying the phantom
debt, his job would be secure.” (ECF No. 12, ¶ 58.) The alleged promises are far closer to
“informal assurances” than the kind of concrete, actionable statement described in Vail, where the
board made an explicit promise, in response to Vail’s concerns, to induce him to leave his current
job, move to a new city, and accept a new position. In essence, the allegation here is that the
Defendants told Lechnir that if he tried to do a good job, he would retain his position. But that is
the implicit promise in almost every job imaginable, not just Lechnir’s. Presumably most
employees expect their contracts to be renewed upon their satisfactory performance, and those
expectations may often sprout from the kinds of informal assurances and utterances that are
common in the workplace. But if such commonplace expectations are enough to create a protected
property interest, the United States Constitution would obviate the need for most public employment
contracts.
Here, the alleged assurances are even less actionable in light of the fact that Lechnir does
not allege that Wells, the Chancellor and ultimate decision-maker, made any such assurances. Even
if Sims and Roter played a role in the process, it would be unreasonable for a high-ranking
university official like Lechnir to rely on vague promises made by individuals who lacked the power
to fully follow-through on such promises. In Vail, of course, the promise was made by the school
board itself and the school superintendent—the only people with the power to honor such a promise.
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Here, there is no indication that either Roter or Sims had the power to live up to such assurances
if Wells wanted otherwise.
In sum, the Due Process claim is precluded; and even if it weren’t, it would fail to state a
claim upon which relief may be granted.

III. Retaliation
The Defendants also argue that Lechnir has not adequately stated any retaliation claims
against Defendants Roter, Sims and Sonnleitner. Surprisingly, Defendants do not argue claim
preclusion here even though the state court of appeals concluded that “the record does not
substantiate” Lechnir’s accusation that the nonrenewal was a result of his whistleblowing. 2015 WI
App 37 ¶ 24, 2015 WL 1034746, *4. Instead, they argue merely that there is no allegation that
Defendants Roter, Sims or Sonnleitner took any adverse action against Lechnir. Defendants argue
it was Wells (who has not moved to dismiss the retaliation claim) who decided to take the adverse
action. And, to the extent the other Defendants took any action at all, the actions were trivial.
To prove a First Amendment employment retaliation claim under 42 U.S.C. § 1983, a
plaintiff must establish three primary elements. First, the plaintiff must show that he engaged in
speech that was constitutionally protected. Garcetti v. Ceballos, 547 U.S. 410, 418 (2006). Second,
the plaintiff must prove that he suffered an adverse employment action as a result of his protected
speech that was sufficiently adverse so as to deter the exercise of the free speech. Vose v. Kliment,
506 F.3d 565, 569–570 (7th Cir. 2007). And third, the plaintiff must present evidence to establish
that a reasonable jury could find that his speech was a “substantial” or “motivating” factor for his
adverse employment action. Graber v. Clarke, 763 F.3d 888, 894-95 (7th Cir. 2014).
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In that Defendants have not moved for dismissal of Lechnir’s First Amendment retaliation
claim against Wells, they do not argue that the complaint fails to allege sufficient facts to state such
a claim as to him. The argument offered by those Defendants who have moved for dismissal is that
since only Wells had the final decision on whether to renew Lechnir’s contract, only he could have
retaliated against Lechnir. Lechnir counters, however, by pointing out that he has alleged that the
Defendants conspired together to retaliate against him for his constitutionally protected speech.
While it may have been Wells who made the ultimate decision not to renew Lechnir’s contract, the
complaint alleges that Rotor, Sims and Sonnleitner conspired with him by providing the pretext
needed to provide cover for their retaliation against him. (Am. Compl. ¶ 180.)
A state actor who conspires with other state actors to violate another’s constitutional rights
can be liable under § 1983 for resulting damages. Walker v. Thompson, 288 F.3d 1005, 1007-08
(7th Cir. 2002). Thus, the fact that Defendants Roter, Sims and Sonnleitner did not have final
authority over Lechnir’s contract does not mean they could not be liable for conspiring with Wells
to terminate him in retaliation for his public speech. “[I]t is enough in pleading a conspiracy
merely to indicate the parties, general purpose, and approximate date, so that the defendant has
notice of what he is charged with.” Id. at 1007. While the amended complaint is less than clear as
to precisely what public statements Lechnir made, when and where he made them and what each
of the defendants did in retaliation, Defendants do not argue that it is otherwise insufficient and thus
there is no need to address the retaliation claim further. Defendants’ motion to dismiss that claim
is denied.

IV. State Law Whistleblower Claim
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Finally, the Defendants move to dismiss the Plaintiff’s state law whistleblower claim
because he has not pled compliance with Wisconsin’s notice of claim statute. Under Wis. Stat. §
893.82(3), “no civil action or civil proceeding may be brought against any state officer, employee
or agent for or on account of any act growing out of or committed in the course of the discharge of
the officer's, employee's or agent's duties,. . . unless within 120 days of the event causing the injury,
. . . the claimant in the action or proceeding serves upon the attorney general written notice of a
claim stating the time, date, location and the circumstances of the event giving rise to the claim .
. .” Section 893.82(2m) provides that “No claimant may bring an action against a state officer,
employee or agent unless the claimant complies strictly with the requirements of this section.”
Lechnir argues that these provisions do not apply because he is suing individuals rather than
the state itself, but by their plain terms the state statutes apply to actions against state employees and
agents. He also suggests that the statute does not apply because he is seeking, in addition to
damages, non-monetary relief such as a letter of apology. It is true that § 893.82(3) does not apply
to claims for injunctive and declaratory relief, Casteel v. McCaughtry, 176 Wis.2d 571, 585, 500
N.W.2d 277 (1993), but that is of no help here.
Here, the complaint seeks no non-monetary relief resulting from any state whistleblower
violation. (ECF No. 12 at 29.) Although the Plaintiff might ask the court or jury to require
Defendant Wells to write an apology letter (for example), that is not a “claim” for injunctive relief
that would escape the notice of claim statute. Accordingly, the failure to follow the notice of claim
procedures bars the state whistleblower claim.

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V. Conclusion
For the reasons given above, Defendants’ motion to dismiss is granted as to Lechnir’s Due
Process claim and his state whistleblower claim. The motion is denied as to the First Amendment
retaliation claim. The clerk will schedule the case for a Rule 16 conference.

Dated this 29th day of June, 2015.

/s William C. Griesbach
William C. Griesbach, Chief Judge
United States District Court

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