The Texas Whistleblower Act
The Texas Whistleblower Act (Act) was adopted “amidst a growing sense throughout the country that ‘mismanagement in the public sector’” was a growing public concern, and that “employees who disclose mismanagement deserve legal protection.” Neighborhood Centers, Inc. v. Walker, 544 S.W.3d 744, 747 (Tex. 2018). The Whistleblower Act is aimed at “ferreting out government mismanagement to protect the public.” Id. at 748.
On May 27, 2022, the Texas Supreme Court addressed the question of what is a good faith report of a violation of law under the Texas Whistleblower Act (the Act). See City of Fort Worth v. Pridgen, —S.W.3d—, 2022 WL (Tex. May 27, 2022) [20-0700] (Pridgen).
In Pridgen, two law enforcement officers with the Fort Worth Police Department sued the City of Fort Worth (City), alleging they were unlawfully disciplined for making a report regarding another officer’s unlawful conduct in his arrest and treatment of others that was videoed and posted to social media outlets. The officers discussed the matter with the chief of police, opining that the officer in question committed certain crimes in the arrest incident and that criminal charges against that officer should be pursued. Later, other evidence of the incident in question was leaked from the police department, and the reporting officers were disciplined for allegedly participating in the leak of information.
The officers sued the City, claiming that they were retaliated against for making a good faith report under the Act. At the trial court level, the City moved for summary judgment based on immunity, and the trial court denied the motion, finding that the Act waived immunity for the claims asserted by the officers. The court of appeals affirmed that denial, holding that the officers, in good faith, reported a violation of law to the chief of police as required by the Act.
The Texas Supreme Court held that, as a matter of law, the officers did not make a qualifying “report” under the Whistleblower Act, and the City was immune from the lawsuit.
Governmental Immunity and the Whistleblower Act
Texas governmental entities, such as cities and municipalities, are typically immune from suit unless the state consents through an express legislative enactment. Pridgen at 9; Rosenberg Dev. Corp. v. Imperial Performing Arts, Inc., 571 S.W.3d 738, 746 (Tex. 2019). The Whistleblower Act provides a limited waiver of that immunity: “A public employee who alleges a violation of [the Whistleblower Act] may sue the employing state or local governmental entity,” and “[s]overeign immunity is waived and abolished to the extent of liability for the relief allowed under [the Act] for a violation of [the Act].” Tex. Gov’t Code § 554.0035.
Whether a governmental entity is immune from a public employee’s suit depends on whether the claim falls within the jurisdictional confines of section 554.0035, and the employee bears the burden of producing evidence that creates a fact issue on that jurisdictional issue. See id. at § 554.004(a).
What claims are covered by the Act?
Section 554.002(a) of the Act provides:
A state or local governmental entity may not suspend or terminate the employment of, or take other adverse personnel action against, a public employee who in good faith reports a violation of law by the employing governmental entity or another public employee to an appropriate law enforcement authority.
Id. at § 554.002(a). The employee must show that he or she (1) reported (2) a violation of law by the employer or another public employee (3) to an appropriate law enforcement authority, (4) the report was made in good faith, and (5) the adverse action would not have occurred when it did if the employee had not reported the illegal conduct. Id. § 554.002(a); Pridgen at 10-11.
What is a Qualifying “Report” under the Act?
The Act does not define the word “report.” The City asserted that the officers did not make a “report” as that term is used in the Act; rather, the officers provided opinions or conclusions and were simply doing their job of investigating another officer’s conduct. Basically, the City claimed that the officers did not “blow the whistle,” and that the information that was reported was redundant to what the City officials already knew. The reporting officers urged the Court to reject the City’s restrictive application of the Act.
The Court sided with the City, finding that to “report” under the Act, “an employee must convey information, not just conclusions[.]” Pridgen at 11. However, the Court also found that, pursuant to applicable statutory interpretation rules—including the plain meaning of the word “report” and the purposes of the Act—the Act does not forfeit a public employee’s protection if a public employee reports information and facts, versus “mere opinions or suppositions”, as part of his or her job duties. Id.; see Univ. of Tex. Southwestern Med. Ctr. at Dallas v. Gentilello, 398 S.W.3d 680, 686 (Tex. 2013) (finding that the fact that employees might discover a violation of law in the course of their professional duties presented no obstacle to seeking the Act’s protection). However, “[c]ommunicating unsupported opinions or legal conclusions is insufficient.” Pridgen at 13.
On this point, the Court concluded: “[T]o properly ‘report’ under the Act, a public employee must convey information that exposes or corroborates a violation of law or otherwise provide relevant, additional information that will help identify or investigate illegal conduct.” Id. at 15 (emphasis added). The Court noted that the word “disclosure” is absent from the Whistleblower Act’s text, and that adding a disclosure requirement would obstruct the Legislature’s goal of addressing misconduct through incentivizing verifiable reports.
Application
The Court found that the officers did not present sufficient evidence that they made a qualifying report under the Whistleblower Act. Their “reports” “were not geared toward exposing, corroborating, or otherwise providing information pertinent to identifying or investigating governmental illegality.” Id. at 20. All officials involved had access to the same sources, videos, and other records relating to the matter reported such that there was no corroboration with respect to the alleged criminal conduct made the basis of the “reports.” The officers’ communications with the chief of police consisted principally of recommendations about the appropriate legal conclusions to be drawn from the officer in question’s actions, and those communications were merely opinions and conclusions, not facts, which the Whistleblower Act does not protect. Id. at 21.
The “reports did not aim to expose, corroborate, or otherwise provide information pertinent to identifying or investigating governmental illegality. They merely voiced opinions and encouraged [the chief of police] to assign” the actions under review a particular legal designation, and “[a]s such, they do not fall within the Act’s purview.” Id.
Insights
Governmental immunity is a strong and sometimes impenetrable shield held by the State of Texas and other state and local governmental entities when faced with a lawsuit or liability. The law recognizes a few swords that may penetrate that shield, one of which is legislative enactment and another is a concept called the “ultra vires exception.” See Freeman Law attorney, Jason Freeman’s blog on The Ultra Vires Exception to Sovereign Immunity in Texas (April 12, 2022). The Texas Whistleblower Act is one piece of legislation through which the Texas Legislature has expressly waived governmental immunity. Under the Whistleblower Act, a governmental entity may not take adverse employment action against a public employee “who in good faith reports a violation of law by the employing governmental entity or another public employee to an appropriate law enforcement authority.” Tex. Gov’t Code § 554.002(a). The recent case of Pridgen confirms that the scope of that statutory waiver of immunity is very fact specific. For a “report” under the Whistleblower Act to be sharp and strong enough to pierce the shield of governmental immunity, it “must convey information that exposes or corroborates a violation of law or otherwise provide relevant, additional information that will help identify or investigate illegal conduct.” Pridgen at 15. Mere opinions or legal conclusions about a particular incident forming the basis of a public employee’s “report” is insufficient to win the battle over governmental immunity.
Whistleblower Defense
Whistleblowers should strongly consider engaging experienced tax counsel to assist with the whistleblower process and to navigate the procedural and substantive pitfalls. Freeman Law’s tax attorneys are available to assist with defending and submitting IRS whistleblower claims. Call today at (214) 984-3000 or contact us online for a consultation.
