IN THE UNITED STATES DISTRICT COURT FOR THE MIDDLE DISTRICT OF TENNESSEE DEFENDANT S REPLY IN SUPPORT OF MOTION FOR SUMMARY JUDGMENT

Transcription

1 IN THE UNITED STATES DISTRICT COURT FOR THE MIDDLE DISTRICT OF TENNESSEE MICHAEL SMITH, ) ) Plaintiff, ) Case No. 3:09-cv-0139 ) v. ) Hon. Judge William J. Haynes ) C.R. BARD, INC., ) ) Defendant. ) DEFENDANT S REPLY IN SUPPORT OF MOTION FOR SUMMARY JUDGMENT In an attempt to prolong this litigation, Plaintiff Michael Smith opposes Defendant C.R. Bard, Inc s Motion for Summary Judgment as to all of his claims by alleging that nearly every fact is disputed. Unfortunately for Smith, the majority of his disputed facts are not true disputes and are not material to the issues that this Court must decide. As to the former, even a cursory review of Smith s responses to Bard s Rule Statement reveals that Smith does not dispute facts, only the inferences that can be drawn from those facts. See, e.g., Pl. RSOF (not disputing objective indicators of Smith s poor performance but arguing that they did not accurately portray his performance). 1 As to the latter, Smith spends an inordinate amount of time in his response brief discussing facts he contends are disputed but which are not actually material to a resolution of the issues raised by the three claims he asserts in this action: retaliation under the Tennessee Public Protection Act ( TPPA ), common law retaliatory discharge, and retaliation under the federal False Claims Act ( FCA ). Critically, none of those 1 Hereinafter, Defendant s Rule Statement of Material Undisputed Facts (Dkt. # 75) is cited as Def. SOF, Plaintiff s Responses to Defendant s Rule Statement of Material Undisputed Facts (Dkt. # 107) is cited as Pl. RSOF, Defendant s Memorandum of Law in Support of Summary Judgment (Dkt. # 74) is cited as Def. Br. at, Plaintiff s Memorandum of Law in Opposition to Defendant s Motion for Summary Judgment (Dkt. # 106) is cited as Pl. Br. at, and Defendant s Memorandum of Law in Opposition to Plaintiff s Motion for Partial Summary Judgment (Dkt. # 103) is cited as Def. Resp. Br. at. Case 3:09-cv Document 115 Filed 03/23/10 Page 1 of 24 PageID #: 5217

2 claims require a determination of whether Bard actually engaged in illegal activity or defrauded the government. See Abner v. Jewish Hosp. Health Care Servs., Inc., No. 4:05-cv-0106, 2008 WL , at *8 (S.D. Ind. Aug. 13, 2008); Sacks v. Jones Printing Co., No. 1:05-cv-131, 2006 WL , at *5 & n.8 (E.D. Tenn. Mar. 16, 2006). 2 Consequently, the first four pages of Smith s Factual Chronology, numerous of his responses to Bard s Rule Statement, and portions of his Argument in his response brief are irrelevant to resolution of Bard s motion. Given the three claims Smith asserts, the only issues for the Court are (1) whether Smith engaged in protected activity, (2) whether his allegedly protected activity caused him to suffer a termination (TPPA and common law) or other adverse employment action (FCA), and (3) whether Bard s legitimate, good-faith reason for deeming him to have resigned was pretextual. With the proper focus on the correct issues, Smith s opposition to Bard s motion melts away. His last-minute attempt to assert a cause of action not pleaded in his Complaint and conspicuously absent from his filings with the Court as well as his declaration contradicting his own deposition testimony clearly demonstrate Smith s efforts to cling at all costs to his doomed claims. Based on the undisputed material facts in the record and in light of the relevant legal authority, Bard is entitled to summary judgment on all of Smith s claims. I. Bard is Entitled to Summary Judgment on Smith s State Law Claims A. Smith Failed to Show That He Engaged in Protected Activity Smith alleges that his 2008 reports of alleged off-label promotion (which he contends occurred one to three years prior) constituted activity protected by the TPPA and Tennessee common law and further alleges that he was retaliated against for engaging in this activity. In fact, Smith s subjective intent affirmatively establishes that he did not engage in protected activity and he cannot show a causal connection between this activity and any adverse action. 2 Unpublished cases are attached hereto as Exhibit E. 2 Case 3:09-cv Document 115 Filed 03/23/10 Page 2 of 24 PageID #: 5218

3 Rather, and despite his pretext arguments to the contrary, the record shows that Smith was a poor performing employee whose multiple employment problems in early 2008 motivated him to make reports of alleged wrongdoing in an effort to insulate himself from discipline. The law does not protect such calculated actions. See, e.g., Al-Marayati v. Univ. of Toledo, 884 F.2d 578 (Table), 1989 WL 99463, at *4-5 (6th Cir. 1989) ( [E]mployees are not protected or insulated from discipline or discharge merely due to the fact that they have... opposed employer practices that they believe to be discriminatory. ). In its opening brief, Bard demonstrated that (1) Tennessee requires a TPPA or common law retaliation plaintiff to subjectively intend to further the public good by way of his or her protected activity and (2) the undisputed facts in this case show Smith had a purely personal concern avoiding potential legal liability when he made his 2008 reports to the Company regarding Tegress, a product sold by Bard from 2005-January Bard cited the on-point case Bright v. MMS Knoxville, Inc., No. M COA-R3-CV, 2007 WL (Tenn. Ct. App. Aug. 7, 2007), in which the state appellate court held that a plaintiff who reported alleged illegal activities was not protected by the TPPA or common law because he had made his reports simply to avoid potential legal liability for the activities. See Def. Br. at (and cases cited therein); see also Treadaway v. Big Red Powersports, LLC, 611 F. Supp. 2d 768, 783 (E.D. Tenn. 2009). In his response brief, Smith argues that there is no subjective intent requirement, relying almost exclusively 3 on Vancleave v. Reelfoot Bank, No. W COA-R3-CV, 2009 WL 3 Smith also cites to Crews v. Buckman Labs. Int l Inc., 78 S.W.3d 852 (Tenn. 2002). In that case, however, the Tennessee Supreme Court repeatedly stressed the uniqueness of the fact pattern and only analyzed whether an inhouse counsel could bring a retaliatory discharge claim. Given the court s efforts to emphasize the unusual nature of the case, see id. at 858 ( [W]e must recognize that this case differs significantly from the usual retaliatory discharge case involving non-lawyer employees ); id. at 862 ( [A]s we have noted throughout this opinion, this case does not present the typical retaliatory discharge claim. ), and because Smith was not in fact an in-house counsel, the Crews case at best is of marginal significance here. 3 Case 3:09-cv Document 115 Filed 03/23/10 Page 3 of 24 PageID #: 5219

4 (Tenn. Ct. App. Oct. 30, 2009), but alternatively argues that he had the requisite subjective intent. His evidence of his motivation is a declaration that contradicts both his own deposition testimony and his responses to Bard s Rule Statement of Facts. Because the law is clear that a TPPA and common law retaliation plaintiffs must have a subjective intent (notwithstanding Vancleave, which does not apply to Smith s claims), and given the undisputed fact that Smith made his reports due to purely personal concerns (regardless of his self-serving declaration, which should be disregarded for contradicting his prior testimony), Bard is entitled to summary judgment on Smith s two state law claims. 1. Vancleave s holding is inapplicable to this case and does not vitiate the subjective intent requirement In Vancleave, the Tennessee Appellate Court acknowledged the Tennessee Supreme Court s prior holding that a putative whistleblower s activities must seek to further the public good, Vancleave, 2009 WL , at *7 (citing Guy v. Mutual of Omaha Ins. Co., 79 S.W.3d 528, 537 n.4 (Tenn. 2002)), and conceded that subsequent appellate court decisions embraced the subjective intent requirement. Id. (citing Collins v. AmSouth Bank, 241 S.W.3d 879, 885 (Tenn. Ct. App. 2007)). As an appellate court, the Vancleave panel could not overrule the Supreme Court and therefore it simply attempted to limit the holding so that it did not apply to the Vancleave plaintiff. The court in Vancleave distinguished between two types of retaliatory discharge claims: those involving a refusal to remain silent (so-called whistleblower claims) and those involving a refusal to participate. Id. at *7. The court found that the subjective intent requirement outlined by the state Supreme Court in Guy and applied in Collins applied only to whistleblower claims (i.e., refusals to remain silent), and because the plaintiff in Vancleave had asserted a refusal to participate, the court found that she need not show a subjective intent. See id. at *8. 4 Case 3:09-cv Document 115 Filed 03/23/10 Page 4 of 24 PageID #: 5220

5 Vancleave s holding is inapplicable here for the simple reason that Smith does not allege a refusal to participate but, rather, a refusal to remain silent. He alleges in his complaint (Dkt. #1 23) that in 2008 he refused to remain silent about alleged illegal activities purported offlabel label marketing that occurred in and he emphasizes in his response brief that it is undisputed that Smith did not remain silent about [alleged] off-label marketing, but complained on multiple occasions. See Pl. Br. at 14. At no time throughout this litigation has Smith ever alleged that he refused to participate in any activity he contends was illegal; indeed, given that his allegedly protected activity came more than one year after Bard stopped selling Tegress and nearly three years after some of the alleged illegal activities occurred, it is impossible for Smith to make such a claim. Because Smith asserts a classic whistleblower claim (that is, a refusal to remain silent), Vancleave s holding does not apply here Smith cannot create an issue of fact with a declaration contradicting his deposition testimony It is undisputed that the sole reason Smith reported in 2008 alleged off-label marketing (which he asserts took place 1-3 years prior to his report) was his belief that he could face some personal liability. See Def. SOF 154; Dkt. # 101 at 53, lines 4-23; see Pl. RSOF 65 (admitting that he only reported same after learning of possible personal liability for himself and other sales representatives for their activity ). While Smith attempts to create an issue of fact as to his intent by way of declaration, see Pl. Br. at 16 (citing Pl. Decl. 7), that new assertion (that he was seeking to further the public s protection from the dangers inherent from using products in a manner that had not been FDA approved ) directly contradicts both his prior 4 Even more disingenuous is Smith s argument (based on a statement in Vancleave) that the subjective intent requirement formulated in Guy and Collins was dicta and inapplicable to his case. In fact, that very statement by Vancleave was itself dicta, as the court in that case had already held that the refusal-to-participate claim was not subject to the seek to further the public good requirement espoused in Guy and Collins. 5 Case 3:09-cv Document 115 Filed 03/23/10 Page 5 of 24 PageID #: 5221

6 deposition testimony (in which he stated multiple times that he only reported in order to avoid possible liability) and his recent response to Bard s Statement of Fact 65. A party may not create a factual issue by filing an affidavit, after a motion for summary judgment has been made, which contradicts her earlier deposition testimony. Hall v. Wal-Mart Stores East, LP, 637 F. Supp. 2d 558, 591 n.2 (M.D. Tenn. 2009) (Haynes, J.) (quoting Reid v. Sears, Roebuck & Co., 790 F.2d 453, 460 (6th Cir. 1986)). See also Barrett v. Whirlpool Corp., 556 F.3d 502, 517 (6th Cir. 2009) (rejecting plaintiff s affidavit submitted in opposition to defendant s motion for summary judgment where it contradicted her prior deposition testimony). Moreover, Smith s newly asserted subjective intent is demonstrably false, as the product had not been sold for over a year when he allegedly made his first report. B. Smith Failed to Establish The Requisite Causal Connection As Bard demonstrated in its opening brief, Smith s TPPA claim requires him to show that his alleged protected activity was the sole reason for his alleged termination; 5 in other words, it is Smith s burden to demonstrate an exclusive causal connection. See Moray v. Novartis Pharm. Corp., No. 3:07-cv-1223, 2009 WL 82471, at *7 (M.D. Tenn. Jan. 9, 2009). Showing an exclusive causal relationship under the TPPA has been described as a formidable burden and a stringent standard. See Caruso v. St. Jude Children s Res. Hosp., Inc., 215 F. Supp. 2d 930, 937, 938 (W.D. Tenn. 2002) (citing cases). Under Tennessee common law, a plaintiff must establish that the protected activity was a substantial factor in his or her discharge. Turner v. Liberty Nat l Life Ins. Co., 488 F. Supp. 2d 672, 677 (M.D. Tenn. May 16, 2007). Despite Bard s extensive discussion of the reasons why Smith cannot demonstrate an exclusive causal connection (under the TPPA) or show that his alleged protected activity was a 5 As Bard showed in its opening, Smith was not terminated but rather was deemed to have resigned. See Def. Br. at 15-16; see Part I.C.1 infra. To show causation, however, Smith must prove he was actually terminated. 6 Case 3:09-cv Document 115 Filed 03/23/10 Page 6 of 24 PageID #: 5222

7 substantial factor in his ultimate separation from Bard (under common law), Smith makes no argument regarding his ability to meet these exacting standards. Indeed, he does not even reference the sole and substantial factor language that is part of every reported decision on these causes of action, and he misstates the elements he needs to prove under the TPPA, notably omitting any reference to the exclusive causal connection he must demonstrate. 6 See Pl. Br. at 13. Smith s silence on this crucial aspect of his burden of proof leaves unrefuted Bard s argument that he cannot show a causal connection between his allegedly protected activity and the separation of his employment. See Def. Br. at Rather than address the formidable burden, Smith instead relies only on temporal proximity in an effort to show causation. He buttresses his two paragraph causation argument with a citation to a single authority Allen v. McPhee, 240 S.W.3d 803, 823 (Tenn. 2007) and asserts that his lone case establishes that close temporal proximity of a complaint and a materially adverse action are sufficient to establish a prima facie case of causation. See Pl. Br. at 16. Smith s reliance on Allen is misplaced for several reasons. First, Allen was brought pursuant to the Tennessee Human Rights Act ( THRA ), not the TPPA or common law. By contrast, the Tennessee Supreme Court has already determined that in the specific context of TPPA and common-law retaliatory discharge claims, temporal proximity alone is not enough to show causation. Mason v. Seton, 942 S.W.2d 470, 473 (Tenn. 1997) (noting in TPPA case that proximity in time between the protected act and the discharge is not sufficient to establish a causal relationship ); Conaster v. Clarksville Coca-Cola Bottling Co., 920 S.W.2d 646, 648 (Tenn. 1995) (rejecting in common law retaliatory discharge case plaintiff s causation argument based solely on temporal proximity, which evidence is not sufficient ). Tellingly, Smith does 6 Not unexpectedly, Smith cites no case to support his omission of that key part of the causation element. 7 Case 3:09-cv Document 115 Filed 03/23/10 Page 7 of 24 PageID #: 5223

8 not reference these on-point authorities, although he does cite Mason throughout his brief for other propositions. Second, the Sixth Circuit has rejected the application of Allen s temporal proximity holding in a common law retaliation case because the court correctly recognized that the state supreme court already decided the issue in that specific context. Ellis v. Buzzi Unicem USA, No , 293 F. App x 365, 375 (6th Cir. 2008) ( The dissent s reliance on the Tennessee Supreme Court s later decision in Allen v. McPhee, 240 S.W.3d 803, 823 (Tenn. 2007), is misplaced here because the Tennessee Supreme Court had already decided the issue in Conaster and therefore Allen is not instructive in this respect. ). 7 Third, Smith fails to address the numerous cases (many post-dating Allen) recognizing that temporal proximity alone is not sufficient to show causation in TPPA and common law retaliation claims. See, e.g., Moray, 2009 WL 82471, at *10 (stating in discussion of TPPA and common law claims: Proximity in time between the protected act and the discharge is not sufficient to show a causal relationship. ); Cooper v. Wyndham Vacation Resorts, Inc., 570 F. Supp. 2d 981, 985 (M.D. Tenn. 2008) (stating in common law retaliation case that courts have consistently held that temporal proximity between the claim and the termination is not by itself sufficient. ); Provonsha v. Studs. Taking a Right Stand, Inc., No. E COA-R3-CV, 2007 WL , at *5 (Tenn. Ct. App. Dec. 3, 2007) (same in TPPA and common law retaliation 7 Until and unless the Tennessee Supreme Court determines that Allen applies to TPPA and common law retaliation claims and specifically overrules Conaster and Mason, this court is bound to follow Sixth Circuit precedent, which correctly rejects the application of Allen to common law claims. Thus despite a Tennessee Appellate Court s belief that Allen would apply to a common law retaliation claim, see Kinsler v. Berkline, LLC, No. E COA-R3- CV, 2008 WL , *5 (Tenn. Ct. App. 2008), appeal granted (Apr. 27, 2009), such a holding does not supercede the on-point Sixth Circuit decision in Ellis, which itself relied on an on-point Tennessee Supreme Court decision. Moreover, as recently noted by the Sixth Circuit in Thayer v. Tyson Foods, Inc., No , 2009 WL , at *3 n.1 (6th Cir. Dec. 8, 2009), the Tennessee Supreme Court is in the process of reviewing [the state appellate court s decision in] Kinsler.... See also Dale Baker Oldsmobile, Inc. v. Fiat Motors of N. Am., 794 F.2d 213, 218 (6th Cir. 1986) (a federal court is not bound by a decision of an intermediate state appellate court when [it is] convinced that the highest state court would decide differently ). 8 Case 3:09-cv Document 115 Filed 03/23/10 Page 8 of 24 PageID #: 5224

9 case). Finally, it makes little sense to apply Allen here because the standard for proving causation under the THRA (which was the subject of Allen) is lower than the exclusive causal relationship/substantial factor test applied in TPPA and common law claims. See Allen, 240 S.W.3d at 807 (describing a THRA plaintiff s burden as merely having to show a causal connection ) (emphasis added). Allen, therefore, does not speak to the quantum of proof that Smith needs to establish his prima facie case under the TPPA and Tennessee common law. C. Smith Failed to Show Pretext As Smith correctly recognizes, a plaintiff trying to establish pretext must show (1) that the proffered reasons had no basis in fact, (2) that the proffered reasons did not actually motivate [her] discharge, or (3) that the they were insufficient to motivate discharge. Russell v. Univ. of Toledo, 537 F.3d 596, 604 (6th Cir. 2008) (quoting Manzer v. Diamond Shamrock Chems. Co., 29 F.3d 1078, 1084 (6th Cir. 1994)). While Smith purports to proceed under all three methods, he fails to show pretext under any. 1. Method One: The proffered reasons actually motivated Bard s actions Like the employee in Russell, Smith s efforts at demonstrating pretext under the first method are premised on his contention that Bard s reasons for deeming him to have resigned had no factual foundation. Id. Specifically, Smith relies on evidence disputing the characterization of his conduct leading up to Bard s determination he had resigned. As the Sixth Circuit recognizes, however, even if [the plaintiff] is correct in these characterizations, they are not sufficient to defeat summary judgment on this claim. Id. at 605. The only relevant question is whether the employer can establish its reasonable reliance on the particularized facts that were before it at the time the decision was made. Id. (internal quotation marks omitted) (second emphasis added). As is clear from the record, the 9 Case 3:09-cv Document 115 Filed 03/23/10 Page 9 of 24 PageID #: 5225

10 particularized facts before Bard at the time it deemed Smith to have resigned was a combination of his words (communicating he would no longer work for Bard) and his conduct (showing he was no longer performing his job duties and evidencing no indication that he would resume those duties in the near future). Contrary to Smith s shifting rationale argument, Bard has always maintained that it accepted Smith s effective resignation based on these particularized facts. Regarding his statements (namely, that he was finished working for Bard, would not work his territory, was cutting off communication with his supervisor, and would not go into his accounts any more), Smith does not dispute that he was confronted with those statements twice in April of 2008, nor does he dispute that he did not deny them at that time. See Pl. RSOF 144, Smith offers no explanation as to why it was unreasonable for the Company to accept the truth of McKeon s report of these statements, particularly in the face of Smith s silence on the matter. While he today denies having uttered those words (presumably to gain an advantage in this litigation), Smith cannot create an issue of fact as to whether he made the statements when he did not dispute those words at the time the alleged retaliation. Based on the facts before the Company at the time it deemed Smith to have resigned, Bard had more than a reasonable basis to believe Smith had made those statements. Russell, 537 F.3d at 605; Dickson v. Sizemore Sec. Int l, Inc., No. 3:06-cv-0886, 2007 WL , at *5 (M.D. Tenn. Oct. 3, 2006) (finding plaintiff could not create issue of fact where he did not deny that other employees reported plaintiff s statements to management, which had reasonable basis for its actions). 8 In his response to fact 144, Smith asserts that he has averred that he did not say the statements attributed to him and he cites to his declaration for support. His declaration, however, makes clear that today Smith disputes making these statements; it does not say that Smith disputed making the statements in April In response to paragraph 146, Smith states that he does not dispute for purposes of summary judgment that he failed to deny the statements in his April 11 response to Gerks s Case 3:09-cv Document 115 Filed 03/23/10 Page 10 of 24 PageID #: 5226

11 Regarding Smith s conduct, his numerous actions provided Bard with concrete, contemporaneous evidence that Smith was in fact making good on his statements to McKeon and effectively ceasing all job-related duties. Gerks s of April 9 shows that Bard viewed Smith s actions as backing up his statements (which he had not refuted in a prior ): You told Ryan, however, that you were finished working for Bard and that you are not going to work your territory or go into any of [your] accounts, underscoring your actions during the last week and a half. Gerks Dep. Exh. 13 (Dkt. # 90-13) (emphasis added). Gerks then identified a sampling of Smith s various actions on which Bard relied in concluding that Smith was putting into practice his statements to McKeon: [Y]ou have had little or no contact with your manager and with customers and have apparently missed scheduled cases....[l]ast week Ryan [McKeon] tried to contact you a number of times... [Y]ou failed to return Ryan s calls. You also failed to respond to Ryan s s. Id. The reference to Smith s performance in Gerks s provided an objective measure of the unacceptable amount of work Smith was doing and was yet another contemporaneous indication that Smith had in fact ceased working for Bard, servicing his accounts, and going into his territory. All of Smith s actions in this regard were voluntary acts, despite Smith s contention that there was nothing voluntary about Plaintiff s departure. Pl. Br. at 17. The fact that Smith refused to use the words I resign does not mean that Company had no reasonable basis for deeming him to have effectively resigned based on the facts before it at the time. See Def. Resp. Br. at The record shows that Bard s reason for deeming Smith to have resigned based on his words and deeds as of April 2008 has not, in fact, changed over time. See Eades v. Brookdale Senior Living, Inc., No. 3:07-cv-00913, 2008 WL , at *7 (M.D. Tenn. Nov. 25, 2008) (rejecting plaintiff s changing rationale argument because the various reasons asserted by the defendant are amply supported by the evidence and the fact that the defendant s explanations have become more nuanced and detailed over the course of litigation does not establish evidence of pretext. ). 11 Case 3:09-cv Document 115 Filed 03/23/10 Page 11 of 24 PageID #: 5227

12 Like the plaintiff in Russell, Smith s efforts at showing pretext under method one consist of contesting the extent of his actions and arguing that they were not as bad as Bard viewed them. See Russell, 537 F.3d at For example, Smith does not deny failing to return his manager s phone calls; he merely has an excuse (he lost his phone charger, Aug. 12 Smith Dep., Dkt. # 100, at 299, lines 4-6, 15-16) and blames his manager for not calling his personal cell phone. See Smith Decl., Dkt. # 108, 15. Nor does he dispute that he took multiple weeks of vacation at the last minute, doing no (or unreasonably little) work during that time; rather he simply argues that I have a right as an employee to take vacation when I want to, Pl. RSOF 111 when you re on vacation you re relieved of all active things until you get off vacation, see id. 106, and his multiple weeks of vacation (including one denied by his supervisor but taken nonetheless) did not violate Company policy. 10 See id , The critical point, however, is that Smith took one month of vacation doing little or no work during a period when his performance was so poor that he had been informed he was going to be placed on a Performance Improvement Plan. Moreover, with Bard aware of Smith s prolonged period of reliev[ing] [himself] of all active things, it made it all the more reasonable that Bard believed McKeon s report that Smith had stated he was finished with Bard. Finally, Smith argues that he can prove pretext under method one because Bard did not discuss with him whether he had made the statements McKeon reported. Pl. Br. at 18. Not only is that factually incorrect he was twice confronted with his statements, see Gerks Dep. Exh. 12 (Dkt. # 90-12); Gerks Dep. Exh. 13 (Dkt. # 90-13) but it is also legally irrelevant. In McDonough v. Memphis Radiological Prof. Corp., No , 2009 WL (W.D. 10 Smith s argument that his last-minute weeks of vacation and the one unapproved week were not violations of Company policy is not even factually correct. Per the terms of the Employee Handbook: Vacation days must be scheduled. Eligible employees must provide sufficient notice and receive approval from their supervisors before taking vacation time. See Exh. A to Declaration of Geoffrey Gerks, filed herewith, at D Case 3:09-cv Document 115 Filed 03/23/10 Page 12 of 24 PageID #: 5228

13 Tenn. July 22, 2009), the plaintiff (like Smith) brought claims under the FCA, TPPA, and common law retaliation. The plaintiff in McDonough was terminated after another employee reported that the plaintiff had used obscene language toward her. Id. at *6, 7. Like Smith, the plaintiff argued against summary judgment on the grounds that there was a dispute of fact as to whether he actually used the words the other employee had reported and why the employer did not ask him about the words attributed to him. Id. at *10. The court rejected those arguments, finding no pretext because the employer reasonably relied on the report by the other employee. Id. at *11. Here, of course, unlike in McDonough, Smith was confronted with his statements; he simply chose not to deny them. That Smith sees fit to deny he made those statements today, two years after the fact and in the midst of litigation, does not undermine the reasonableness of Bard s decision at the time it deemed him to have resigned. 2. Method Two: Smith cannot show a cover up Smith also attempts to show pretext under the second method, under which the plaintiff admits the factual basis underlying the employer s proffered explanation and further admits that such conduct could motivate dismissal. Russell, 537 F.3d at 606 (quoting Manzer, 29, F.3d at 1084). Smith makes several arguments in trying to show that Bard s (factually true) basis was a cover-up. First, he argues that his performance was not as bad as Bard believed it to be in April of See Pl. Br. at 18. That argument fails in light of the overwhelming documentary evidence showing that Smith s performance had been poor since See Def. SOF Smith does not contest any of the numbers or comments made over the final years of his employment, see Pl. RSOF 15-40, but rather simply tries to argue (improperly, in his Rule responses 11 ) about the proper inference to be drawn from those facts. Most importantly, 11 In responding to Bard s Rule Statements of Fact, Smith admitted the accuracy of his rankings and that his supervisors had made statements in various performance evaluations as to the insufficiency of his performance. See 13 Case 3:09-cv Document 115 Filed 03/23/10 Page 13 of 24 PageID #: 5229

14 Smith s self-evaluation from February 2008 demonstrates his own contemporaneous belief that his performance was poor, as he gave himself Needs Improvement ratings in three out of four product categories as well as in his overall rating, admitted that I need to step up my game, and stated that he need[ed] to take the advice of Ryan [McKeon] and Gary [Lickovitch] to fulfill my own expectations for success. See Def. SOF Critically, Smith sent his self-evaluation to his manager on February 10, 2008, approximately two weeks after he made his allegedly protected statement to Lickovitch. See and Self-Evaluation, attached hereto as Exhibit A. Thus, the record shows that Smith s performance problems began far before any alleged protected activity, Smith himself believed that his performance was poor, and Smith maintained his belief even after his first allegedly protected statement. In such circumstances, it is unclear how Bard s continued monitoring and attempts to improve Smith s admittedly poor performance establish pretext. See Bacon v. Honda Mfg., Inc., 192 F. App x 337, 345 (6th Cir. 2006) (finding plaintiff s dispute during litigation of extent of his performance did not show pretext where company reasonabl[y] reli[ed] on the particularized facts that were before it at the time the [adverse] decision[s] w[ere] made ) (alterations in original). Smith also tries to argue that the timing of the Performance Improvement Plan ( PIP ) suggests a cover-up was afoot. In fact, the record shows the PIP was fully drafted before Smith ever sent his letter to Mark Downey, and Smith had been warned before his alleged statement to Lickovitch that the PIP would be implemented if he was not trending to achieve his 2008 quotas by the end of March Def. SOF 40. Smith points to no evidence showing that Def. SOF However, in his responses, he included improper argument that the objective fact (which he admits is correct) did not accurately reflect his performance. See Pl. RSOF Such argument is clearly nonresponsive and an improper attempt to argue the inference to be drawn from the fact. That type of argument, however, should be raised in a brief, not Rule responses. Bridgeport Music, Inc. v. Universal-MCA Music Pub., Inc., No. 3: , 2006 WL , *2 n.3 (M.D. Tenn. Apr. 6, 2006) ( Response[s] to statement[s] of undisputed facts are not the place for legal argument. ). 14 Case 3:09-cv Document 115 Filed 03/23/10 Page 14 of 24 PageID #: 5230

15 McKeon and Smith agreed that they would wait to implement a PIP until the end of March or until final quarter numbers had been submitted. More importantly, however, the PIP was never implemented as Bard suspended it in light of Smith s conveniently-timed letter to Downey and therefore it is irrelevant to the pretext analysis. Mitchell v. Vanderbilt Univ., 389 F.3d 177, 182 (6th Cir. 2004) (finding discipline not actually implemented was not adverse action). Smith s suggestion that the March 2008 rankings denoting his territory as open somehow evidences pretext is easily rejected given that Bard s monthly rankings were published in arrears due to the time it took to count and process sales. See Declaration of Catherine Ozburn, filed herewith, 4. By the time the March 2008 rankings were published, Smith had separated his employment and thus his territory was designated open. Id Nor is it significant that Smith developed opportunities even very promising ones in early January 2008 because there is no evidence showing that Smith ever capitalized on those opportunities. See Pl. Br. at 19. The notion that opportunities that never translated into new business and which preceded his separation three months later somehow shows pretext is a non-starter. Smith s heightened scrutiny argument is easily disposed of simply by considering the timeline of events. With respect to his interactions with the MDU (physician training) program, including the suspicion of inconsistent doctor signatures, Smith contends that the reprimands he received were pretextual and that he was subjected to heightened scrutiny. See Pl. Br. at 25. The record actually shows just the opposite: that his problems with MDU pre-dated his alleged whistleblower statements. His issues with MDU took place in the third week of January, before the National Sales Meeting where Smith alleges he made his first report regarding Tegress. See Def. SOF 42-43, 47-49, 51-53, 56. Smith does not contest the timing of these incidents. See Pl. RSOF 42-43, 47-49, 51-53, 56. Smith s problems with MDU preceded his allegedly 15 Case 3:09-cv Document 115 Filed 03/23/10 Page 15 of 24 PageID #: 5231

16 protected activity and no heightened scrutiny took place afterwards because Bard s response to Smith s violation of MDU rules had been completed. Strickland v. Fed. Express Corp., 45 F. App x 421, (6th Cir. 2002) ( The relevant adverse action effectively took place before any protected activity and therefore cannot form the basis of a retaliation action under the ADEA. ) Finally, regarding Smith s direct evidence of pretext (Gary Lickovitch s alleged statements in January of 2008), Smith admits that Lickovitch did not supervise either Smith or McKeon, was not copied on any of the correspondence between Smith, Gerks and McKeon in April of 2008, and played no part in deeming Smith to have resigned. See Pl. RSOF 147. It is not clear why a non-decisionmaker/non-supervisor with no role in either deeming Smith to have resigned or implementing that decision is direct evidence of alleged retaliation. Because Lickovitch s alleged statement was by a non-decisionmaker at a time remote from the alleged retaliation, it is of minimal if any significance. Suits v. Heil Co., 192 F. App x 399, 407 (6th Cir. 2006) (finding in context of pretext that stray remarks, particularly those made by a person other than a decision-maker, are not enough to show discrimination ). 3. Method Three: Smith cannot show comparators were treated better than he Finally, Smith claims he can show pretext by way of the third method, which requires evidence that other employees who engaged in substantially similar conduct were treated better than he. See Russell, 537 F.3d at 607. Although Smith now argues that other employees were treated differently, see Pl. Br. at 19-20, he has not shown that any of those individuals were actually similarly situated. As the Sixth Circuit has explained in the context of a common law retaliatory discharge claim, To be similarly situated, a comparator must have dealt with the same supervisor, have been subject to the same standards, and have engaged in the same conduct 16 Case 3:09-cv Document 115 Filed 03/23/10 Page 16 of 24 PageID #: 5232

17 without such differentiating or mitigating circumstances that would distinguish their conduct or their employer s treatment of them for it. Ellis, 293 F. App x at 272. Smith does not even attempt to make the requisite showing regarding his twenty-one comparators. In fact, the record shows that none of the other TMs that Smith points to were comparable to him. Not counting rookies or open territories (which are by definition not comparable to Smith), as of February 2008 all of the TMs who ranked below Smith for that month had finished the prior year (2007) with positive sales growth. See February 2008 Eligible rankings, attached hereto as Exhibit B; 2007 Final Eligible Rankings, attached hereto as Exhibit C. By contrast, Smith finished 2007 with negative sales growth, see Smith Dep. Exh. 31 (Dkt. # ), and thus clearly was in a far different position vis-à-vis his continued, poor performance (to say nothing of his statements to McKeon) than his peers in February In addition, the only TM with the same manager as Smith who ranked below him in February 2008 Trey Tolbert finished 2007 ranked fourth overall among BUD eligible TMs, experiencing $549,786 in positive sales growth. See Exhibit C. Smith s comparators, therefore, did not engage in substantially similar conduct because unlike Smith, they had not recorded several years of sustained poor performance (in fact all had experienced positive sales performances in 2007) and none had informed their managers that they were finished working for the Company. With no evidence that any of the comparators were similarly situated as defined by the Sixth Circuit or treated better than Smith, this argument fails. II. Bard is Entitled to Summary Judgment on Smith s FCA Claim 17 Case 3:09-cv Document 115 Filed 03/23/10 Page 17 of 24 PageID #: 5233

18 Smith fails to state a claim under the FCA because he cannot show that he had engaged in protected activity, he cannot make a causal connection between his alleged protected activity, and the separation of his employment, and he cannot show pretext. 12 A. Smith Failed to Demonstrate A Subjective Good Faith Belief That Bard Committed Fraud Against The Government As Bard argued in its opening brief, Smith fails to meet his burden of showing that he engaged in protected activity under the FCA because he was admittedly not motivated by a suspicion of fraud on the government. There is no dispute that (1) in 2008 Smith reported alleged off-label marketing that he asserts took place between one and three years before his report; and (2) the sole reason he made these reports was to avoid any possible personal liability. See Part I.A.2 supra. FCA case law is clear that a prospective whistleblower s purpose that is, his motivation in engaging in activity must be to stop or expose fraud on the government. See, e.g., Perius v. Abbott Labs., No. 07 C 1251, 2009 WL , at *6 (N.D. Ill. June 26, 2009) (stating that protected activity under the FCA requires an examination both of the type of activity and of the putative whistleblower s purpose in engaging in the activity); Moor-Jankowski v. Bd. of Trs. of New York Univ., No. 96 Civ. 5997, 1998 WL , at *12 (S.D.N.Y. Aug. 10, 1998) (dismissing FCA whistleblower claim where [t]he Complaint makes clear that exposing a fraud upon the government within the meaning of the FCA was not Dr. Moor-Jankowski s motivation in engaging in her claimed protected activity); Luckey v. Baxter Healthcare Corp., No. 95 C 509, 1998 WL , at *17 (N.D. Ill. June 18, 1998) (noting that employee has burden showing activity was directed at exposing a fraud upon the government ). While Smith tries to distinguish Perius in a footnote by arguing that Perius had not included a statement that he was pursuing or assisting in making a FCA claim, see Pl. Br. at n.11, that fact is irrelevant. As the 12 Because Smith s pretext arguments are the same for both his state and federal claims, Bard expressly incorporates 18 Case 3:09-cv Document 115 Filed 03/23/10 Page 18 of 24 PageID #: 5234

19 Perius court made clear, whether a party acted in furtherance of an FCA enforcement action requires an analysis of the type of activity the plaintiff engaged in and his purpose in engaging in that activity. Here, even assuming that Smith s invocation of the term false claims act in an to Geoff Gerks satisfied the type of activity part of the analysis, it is undisputed that Smith s purpose in engaging in that activity was to avoid possible personal liability. That simply does not constitute protected activity under the FCA. Furthermore, Smith s alleged protected activity was clearly not an attempt to stop or expose on-going fraud, as his allegations related to a product that had not been sold or marketed by the Company for over a year. As made clear in a recent amendment to the FCA entitled Clarifications to the False Claims Act to Reflect the Original Intent of the Law, the protected activity engaged in by a potential plaintiff must consist of actions in furtherance of other efforts to stop 1 or more violations of this subchapter. See Fraud Enforcement and Recovery Act of 2009, Pub. L. No , 4, 123 Stat. 1617, 1621, (2009) (emphasis added). The addition of the words to stop 1 or more violations makes clear that the original intent of the law was to limit protection to individuals attempting to stop on-going fraud. Here, Smith made no effort to stop alleged on-going fraud during the years Tegress was marketed (2005, 2006 and one month of 2007) and actually affirmatively certified during each of those years that he was not aware of any violation of the law or Ethics Policy. See Dkt. # 75-7 at D Given that the first report he made to Bard was in 2008 years after Bard stopped selling Tegress and long after he repeatedly certified that he was not aware of any illegalities his activity clearly was not performed in good faith or with a purpose to stop or expose an on-going fraud. 13 its analysis in Part I.C supra. 13 Smith s multiple references to a Tegress Reimbursement Guide and a series of communications concerning potential Medicare reimbursement for Tegress is a failed attempt to mislead and confuse issues. Pl. Br. at 3-6, 8, As discussed above, the relevant inquiry as to all of Smith's claims is not whether off-label promotion in fact 19 Case 3:09-cv Document 115 Filed 03/23/10 Page 19 of 24 PageID #: 5235

20 B. Smith Failed to Establish A Causal Connection Between His Alleged Protected Activity and His Claimed Adverse Action Although Bard argued that Smith was unable to show causation under the FCA, see Def. Br. at 23, Smith curiously states in his response that Defendant does not contend that Mr. Smith is unable to make out a case of causal connection. See Pl. Br. at 23. Not only did Bard so contend, it also pointed to evidence showing the absence of a causal link, which Smith ignores in his response brief. Moreover, the only evidence Smith cites to show causation is temporal proximity. Even in the authority Smith relies on, however, it is clear that temporal proximity alone is not sufficient to establish causation. See, e.g., Pl. Br. at 23 (quoting Asmo v. Keane, 471 F.3d 588, 598 (6th Cir. 2006), and observing Asmo s language that temporal proximity cannot alone prove pretext ). For the same reasons discussed in Part I.B supra, Smith fails to show causation under the FCA and Bard is entitled to summary judgment on that claim. III. Smith Did Not Properly Raise a Tennessee FCA Claim occurred, but, rather, whether Smith had a subjective good-faith belief at the time he made his reports. Clearly, those materials did not form the basis for any belief that Smith may have had as he did not ever bring those materials to the attention of Bard, either before or during its investigation of his complaints. The Reimbursement Guide and communications upon which Smith now relies come directly from the report of Morgan Lewis & Bockius, the law firm investigating Smith s claims. Memeger Decl. Exh. A (Dkt. # 79-1) at D The report, of course, was provided to Smith in discovery in this lawsuit. Smith s attempt to rely upon these documents after the fact is disingenuous at best. Smith also makes reference to a slide from a training session stating, Reimbursement Codes for off-label uses may not be provided. Pl. Br. at 8. What Smith fails to inform the Court is that the Reimbursement Guide did not provide reimbursement codes for off-label uses of Tegress. As Bard explained in its opening brief, Tegress was approved by the FDA for the treatment of intrinsic sphincter deficiency ( ISD ) and stress incontinence in women. See Def. Br. At 6. Only two diagnosis codes are provided in the Reimbursement Guide, both of which are consistent with the FDA indication Intrinsic Sphincter Deficiency and Stress Incontinence Female. See Exh. A to Declaration of Michael Smith (Dkt. #108-1) at 1. A separate Medicare diagnosis code does exist for Stress Incontinence Male, but, critically, the Reimbursement Guide did not provide that code. See id.; see also Classification of Diseases and Injuries, attached hereto as Exhibit D, at 365, 382, 530 (available on the website for the Centers for Medicare and Medicaid Services, the federal agency charged with administering Medicare, Unlike for stress incontinence, however, ISD does not have separate diagnosis codes for females and males, so any provider seeking reimbursement for treatment of a female for ISD must use the diagnosis code that is provided in the Reimbursement Guide. Id. The language in the Reimbursement Guide that does make reference to males comes directly from the CMS coverage manual for bulking procedures. Id. The CMS coverage manual is not device specific, and some of the covered procedures are for males and females. Id. Directly contrary to the assertion in Smith s brief that the Morgan Lewis investigation uncovered evidence supporting Smith s allegations, Pl. Br. at 22, the report properly concluded that these materials were not a cause for concern. Memeger Decl. Exh. A (Dkt. # 79-1) at D Case 3:09-cv Document 115 Filed 03/23/10 Page 20 of 24 PageID #: 5236

21 In a footnote, Smith asserts that Bard did not seek summary judgment on his purported claim under the Tennessee False Claims Act ( TFCA ), suggesting that the TFCA claim should survive even if Bard s motion is granted as to all other claims. Pl. Br. at 13 n.3, 22. This argument is easily rejected for several reasons. First, Bard s Motion for Summary Judgment makes clear that summary judgment is sought as to each and all of Smith s claims. Dkt. #73. Second, Smith did not plead a separate claim under the TFCA, as is clear from Paragraph 1 of his Complaint: This action is brought pursuant to Section 3730(h) of the qui tam provisions of the False Claims Act (the FCA ), 31 U.S.C , which prohibits retaliation against any employee engaged in the protected activity of investigating possible fraud against the United States government, The Tennessee Public Protection Act (the Act ), Tenn. Code Ann et. seq., which provides that no employee shall be discharged or terminated solely for refusing to participate in, or for refusing to remain silent about, illegal activities, and Tennessee common law prohibiting retaliatory discharge. Dkt. #1 1. Critically, the TFCA is not mentioned or referenced in any way. Moreover, Smith s Complaint sets forth three, separate enumerated Counts, with no count purporting to assert a claim under the TFCA. In multiple filings with the Court, including the proposed Initial Case Management Order (Dkt. # 35 at 2), and Plaintiff s Memorandum of Law in Support of Motion for Entry of Electronic Discovery Protocol (Dkt. # 42 at 1), Smith mentioned only claims under the federal FCA, the TPPA, and Tennessee common law when describing his claims and did not mention the TFCA. When the Court entered the Initial Case Management Order, which contained Smith s own descriptions of his claims, again there was no mention of the TFCA. See Dkt. # 37 at 2. Accordingly, even if Smith intended to raise this claim in his Complaint, he abandoned that claim by making no mention of it in the Initial Case Management Order and other subsequent filings. See Dickson, 2007 WL , at *7 (finding plaintiff abandoned 21 Case 3:09-cv Document 115 Filed 03/23/10 Page 21 of 24 PageID #: 5237

22 common law retaliation claim where he made no mention of the common-law claim in his theory of the case as set forth in the proposed Case Management Order ). But even if the reference to a single section from the TFCA buried within Count I of the Complaint was sufficient to properly assert the claim, Smith pleaded the TFCA claims on exactly the same allegations as the federal FCA claim, making no distinction whatsoever regarding the facts, elements, theories, or potential recovery, thereby acknowledging that the TFCA claim should be analyzed under the same standards as the federal FCA claim. Bard s research reveals no cases decided under the TFCA s whistleblower provision, T.C.A However, Tennessee courts interpreting other provisions of the TFCA have relied on federal FCA precedent for guidance. See State ex rel. Landenberger v. Project Return, Inc., No. M COA-R3-CV, 2009 WL , *4 (Tenn. Ct. App. Mar. 11, 2009) (noting that there were as yet no appellate decisions interpreting the TFCA. We therefore look to decisions interpreting the federal [FCA] since the federal act contains original source provisions similar to those at issue here ); In re Knox County, Tenn. ex rel. Enviro. Termite & Pest Control, No. E COA-R3-CV, 2009 WL , at *5-6, *8-13 (Tenn. Ct. App. July 20, 2009), appeal granted (Feb. 22, 2010) (looking to cases construing FCA for guidance on the original source provision and on a qui tam plaintiff s statutory share of settlement proceeds). Under these circumstances, if summary judgment is appropriate with respect to the federal FCA claim, the same reasoning should apply to dispose of the alleged TFCA claim. CONCLUSION For the foregoing reasons, Bard respectfully requests that the Court grant its Motion for Summary Judgment on all claims. Dated: March 15, Case 3:09-cv Document 115 Filed 03/23/10 Page 22 of 24 PageID #: 5238