HASELTON, C.J.
Plaintiff Stephen Lucas appeals a judgment in favor of defendant Lake County, contending that the trial court erred in (1) dismissing, on summary judgment, his blacklisting claim as being barred by claim preclusion arising from prior federal litigation between the parties and (2) granting judgment on the pleadings as to his wrongful discharge claim on the ground that the complaint did not sufficiently allege that plaintiff's termination contravened an "important public duty." Defendant cross-assigns error, contending that, because plaintiff's wrongful discharge claim was also barred by claim preclusion principles, the trial court erred in denying its motion for summary judgment as to that claim. As amplified below, we conclude that claim preclusion did not bar either of plaintiff's claims and, for that reason, the trial court erred in allowing summary judgment as to the blacklisting claim but properly denied it as to the wrongful discharge claim. We further conclude that, because plaintiff alleged that his termination contravened an "important public duty," the trial court erred in allowing judgment on the pleadings as to the wrongful discharge claim. Accordingly, we reverse and remand.
Because the circumstances of this case involve litigation between the parties in both federal and state courts, as well as extensive motion practice in the state court action from which this appeal originates, the operative procedural facts, although undisputed, are somewhat complicated. For that reason, our recitation of those facts is necessarily detailed.
On April 28, 2005, defendant terminated plaintiff, a deputy sheriff sergeant, from his position as the jail manager of the Lake County Jail. At that time, the Lake County Sheriff did not tell plaintiff the reason for his termination.
In July 2006, plaintiff filed an action against defendant in the United States District Court for the District of Oregon alleging, among other things, that defendant violated the Americans with Disabilities Act (ADA), 42 U.S.C. § 12112, by terminating his employment because of a permanent partial disability related to his former military service or a perceived disability. Plaintiff's complaint also alleged that the federal court had supplemental jurisdiction over plaintiff's state law claims for unlawful employment practices and defamation.
As pertinent to the issues on appeal, plaintiff also alleged a claim for defamation. That claim was essentially predicated on an allegation that, "[o]n or about April 27, 200[5]" — the day before plaintiff's termination — defendant's Law Enforcement Data System (LEDS) representative sent an e-mail to the state-wide LEDS Training and Education Manager falsely indicating that "plaintiff had cheated on an examination required for access to [LEDS] and had encouraged another employee to do so as well." Further, plaintiff alleged that the "false statements were defamatory, and were intended by defendant to injure plaintiff's reputation as a law enforcement officer and to interfere with his ability to obtain other employment in that field after his discharge by defendant." Plaintiff sought $100,000 in damages for injury to his reputation and extreme emotional distress.
The federal court ordered the parties to complete discovery by March 9, 2007. Approximately a month before that deadline, defendant took plaintiff's deposition. During that deposition, plaintiff's attorney indicated that he anticipated that he would need to amend plaintiff's complaint based on information that he "ha[d] just received th[at] week."
Although the record does not demonstrate that plaintiff filed a motion to amend his complaint in federal court, he filed a motion to extend the discovery deadline. In that motion, plaintiff's attorney explained that he sought to investigate a new theory about plaintiff's termination — viz., that defendant had wrongfully terminated plaintiff in retaliation for, and to conceal the results of, his investigation concerning an incident in which a deputy under his supervision had required a female inmate at the Lake County Jail to engage in oral sex. According to plaintiff's attorney, he needed additional discovery to ensure that filing a claim for, among other things, common-law wrongful discharge was "justified by the facts."
On April 2, 2007, the federal court held a hearing concerning plaintiff's motion. During that hearing, the court confirmed that defendant's position was that it had fired plaintiff because he had cheated on the LEDS examination. The following colloquy then ensued between the court and plaintiff's counsel:
(Emphasis added.)
In sum, in denying plaintiff's motion to extend the discovery deadline, the federal court effectively refused to allow plaintiff to amend his complaint to allege a common-law wrongful discharge claim. The court then turned its attention to defendant's summary judgment motion. In that regard, as pertinent to the issues on appeal, defendant contended that plaintiff's defamation claim was barred under the doctrine of absolute privilege.
Then, on April 27, while the federal litigation was still pending and before the federal court ruled on the summary judgment motion, plaintiff filed this action in state court alleging claims for blacklisting, ORS 659.805,
Further, plaintiff alleged that,
(Emphasis added.) Plaintiff sought (1) $100,000 in damages for "emotional distress, humiliation, and injury to his reputation" and (2) economic damages for lost wages, the amount of which plaintiff proposed to establish at the time of trial in the state action because they would continue to accrue over time.
Plaintiff's state court wrongful discharge claim was (and is) predicated on the same basic operative facts that he had described in his motion to extend the discovery deadline in the federal district court. In general terms, plaintiff alleged the following facts:
After becoming aware that a deputy under his supervision had been flirting with female inmates, plaintiff had requested authorization from the sheriff to provide training to all deputies concerning appropriate conduct, but the sheriff had "rejected plaintiff's suggestion as unnecessary." Plaintiff later learned about an incident in which the subordinate deputy allegedly required a female inmate to engage in oral sex for contraband (i.e., tobacco). When interviewed by plaintiff, the inmate had confirmed the incident. Plaintiff immediately notified the sheriff, who authorized him to conduct an official investigation.
Plaintiff had provided a written report of his investigation to the sheriff, recommending that "an outside agency be called in to conduct an investigation of possible criminal culpability." Thereafter, in the presence of the sheriff, plaintiff reported to defendant's insurance representative that "the incident
Against the backdrop of those factual allegations, plaintiff, in his common-law wrongful discharge claim alleged that,
Plaintiff further alleged that his discharge was wrongful because "defendant terminated plaintiff's employment in retaliation for his having fulfilled the said duties and in order to conceal the facts regarding the defendant's civil liability for the conduct of [the deputy] toward [the female inmate]."
On May 7, 2007 — approximately 10 days after plaintiff filed his complaint in state court — the federal court litigation was concluded. The federal court granted summary judgment in favor of defendant on all of plaintiff's claims — that is, the federal ADA claim and the state claims for unlawful employment practices and defamation. Specifically, with regard to the defamation claim, the court concluded that absolute privilege barred plaintiff from pursuing his claim. The court entered judgment accordingly.
Thereafter, defendant moved for summary judgment against both of plaintiff's claims in this case, asserting that the federal court's judgment precluded those claims. The parties' competing contentions as to the proper interplay between the federal court litigation and adjudication and the prosecution of the claims in this action were framed by reference to Ram Technical Services, Inc. v. Koresko, 215 Or.App. 449, 171 P.3d 374 (2007), adh'd to as clarified on recons., 217 Or.App. 463, 177 P.3d 10 (2008) (Ram I), rev'd, 346 Or. 215, 208 P.3d 950 (2009) (Ram II).
Our analysis in Ram I was, in turn, implicitly informed by section 25 comment e of the Restatement (Second) of Judgments (1982), which recognizes that,
Ram II, 346 Or. at 220, 208 P.3d 950 (citations omitted).
For its part, defendant contended that the general rule required preclusion because plaintiff's state and federal claims arose out of the same factual transaction and that plaintiff, through his state claims, was simply seeking to relitigate (1) the propriety of his termination by alleging a new reason that it was wrongful and (2) "the circumstances surrounding plaintiff's lack of veracity during the LEDS exam[ination] and defendant's related accusation." In sum, defendant, consistently with the general rule, asserted that plaintiff could have raised his claims in the federal action and, thus, was precluded from pursuing them now.
As particular support for that position, defendant relied on our then-recent decision in Ram I in which we had held that "broadened supplemental jurisdiction rules not only allow plaintiffs to litigate both state and federal issues at once in federal court, but they also compel plaintiffs to assert all of their transactionally related claims in a single federal forum — or risk losing them to claim preclusion."
Plaintiff remonstrated that "the judgment in the Federal case d[id] not bar the claims alleged in this case." With regard to his blacklisting claim, plaintiff contended that claim preclusion was inapposite because that claim concerned a different factual transaction from the defamation claim adjudicated in federal court. That was so, according to plaintiff, because, unlike his defamation claim, the blacklisting claim involved communications that occurred after his termination.
Plaintiff's primary contention, however, was that claim preclusion was inapposite here because the federal district court had not permitted plaintiff to adjudicate his blacklisting and wrongful discharge claims in the federal action. Specifically, plaintiff explained that he had
(Boldface in original.)
Bluntly (at least in plaintiff's view): The "exception" to the Restatement's "general rule" of preclusion applied because plaintiff had sought to amend his federal complaint to include his blacklisting and wrongful discharge claims and the federal court had clearly declined to allow him to do so.
The trial court granted defendant's motion as to plaintiff's blacklisting claim but denied it as to the wrongful discharge claim. The trial court concluded that claim preclusion barred plaintiff's blacklisting claim because it was "related to the same factual transaction as the [federal] suit and is of such a nature that it could have been joined in it." In particular, the court noted that "[t]he crux of plaintiff's blacklisting claim is the same as his
The court, however, came to a different conclusion with regard to the wrongful discharge claim. Specifically, the court identified two reasons that claim preclusion did not bar that claim. First, the court explained that the wrongful discharge claim "[was] not based upon the same factual transactions at issue in the Federal Court case. Both cases involved alleged wrongful dismissal, but they rely upon very different facts."
Second, and alternatively, the court explained that the wrongful discharge claim "could not have been joined in the first action since [the federal district court] effectively did not allow it to be joined." Specifically, the trial court explained that the "main focus [of the federal district court] was to keep the Federal Court case progressing to trial" and that, consistently with Ram I, plaintiff had effectively attempted to pursue his wrongful discharge claim in federal court when he sought to extend the discovery deadline. In sum, the court reasoned that, "[a]lthough plaintiff never actually moved to join the claim in the federal suit, it is clear that an attempt to do so would have been futile." Accordingly, the trial court denied defendant's summary judgment motion as to the wrongful discharge claim.
Defendant subsequently moved for judgment on the pleadings under ORCP 21 B as to plaintiff's wrongful discharge claim. In support of that motion, defendant relied principally on the Supreme Court's decision in Lamson v. Crater Lake Motors, Inc., 346 Or. 628, 216 P.3d 852 (2009), and particularly on the court's statement that,
Id. at 638, 216 P.3d 852 (emphasis in original). In light of that reasoning, defendant contended that plaintiff's complaint failed to identify "a sufficient basis in law, either by statute, constitutional provision, or existing case law, for his allegedly important societal [duty]."
Plaintiff remonstrated that various statutes demonstrated that a sheriff is responsible for enforcing the criminal law and that, as a deputy, he has a derivative duty. Specifically, plaintiff explained that his duty to respond as he did to "knowledge that a deputy under his supervision had engaged in criminal sexual activity and bribe-taking with a female prisoner" derived "from the Sheriff's
The trial court, without amplification, granted defendant's motion for judgment on the pleadings as to the wrongful discharge claim. Given its dismissal of both of plaintiff's claims, the court then entered judgment for defendant. Plaintiff appeals.
As amplified below, we conclude that claim preclusion did not bar either of plaintiff's claims — and, thus, the trial court erred in allowing summary judgment as to the blacklisting claim but properly denied it as to the wrongful discharge claim. We further conclude that, because plaintiff alleged circumstances sufficient to establish that he was terminated for fulfilling an important public duty, the trial court erred in allowing judgment on the pleadings as to the wrongful discharge claim.
Because they both pertain to the proper application of claim preclusion principles, we turn first to plaintiff's assignment of error and defendant's cross-assignment of error concerning the trial court's summary judgment rulings. Before addressing the parties' specific contentions, however, we begin by determining whether state or federal law governs the resolution of that legal issue.
"The general rule is that the preclusive effect to be given to a judgment is determined by the law of the jurisdiction in which the judgment was rendered. Aguirre v. Albertson's, Inc., 201 Or.App. 31, 46, 117 P.3d 1012 (2005). Thus, "state courts generally are bound by federal law in determining the preclusive effect of federal court judgments."
Nevertheless, as we noted in Aguirre, "[a]s a practical matter, * * * preclusion principles `as expounded in state and federal courts' often reflect few or no differences, so that it is `usually a moot question whether the effect of a federal judgment is determined by federal law or state law.'" 201 Or.App. at 46, 117 P.3d 1012 (quoting Restatement § 87 comment a). That appears to be the case here. Consequently, "in an exercise of caution," we cite both Oregon and federal authorities in our discussion of claim preclusion principles.
Here, we begin with plaintiff's blacklisting claim. Plaintiff contends that claim preclusion principles did not bar the prosecution of that claim because it concerned a different factual transaction from the defamation claim adjudicated in federal court. Plaintiff explains that, unlike the defamation claim — which concerned a statement "made before [his] termination and for the purpose of justifying that termination" (boldface omitted; emphasis added) — his blacklisting claim concerned statements and conduct that occurred after his termination. As amplified below, we agree with plaintiff.
"As a rule, * * * a subsequent claim is barred by a prior judgment if the earlier litigation proceeded to final judgment, involved the same parties, and concerned a claim arising out of the same transaction or series of related transactions." Aguirre, 201 Or.App. at 47, 117 P.3d 1012 (citing Headwaters,
201 Or.App. at 47, 117 P.3d 1012 (footnote omitted).
In determining whether a set of facts constitutes a single transaction, we and the Ninth Circuit rely on the approach expressed in section 24(2) of the Restatement, which "giv[es] weight to such considerations as whether the facts are related in time, space, origin, or motivation [and] whether they form a convenient trial unit[.]" See Western Systems, Inc. v. Ulloa, 958 F.2d 864, 871 (9th Cir.1992), cert. den., 506 U.S. 1050, 113 S.Ct. 970, 122 L.Ed.2d 125 (1993) (applying that approach); Handam v. Wilsonville Holiday Partners, LLC, 221 Or.App. 493, 498, 190 P.3d 480 (2008) (same).
Applying those principles to the circumstances here, we conclude that plaintiff's blacklisting claim did not arise out of the same transaction as did his defamation claim in federal court. In general terms, the factual transaction at issue in the federal action involved the circumstances surrounding plaintiff's termination. In that context, the defamation claim concerned a single false statement — viz., that plaintiff had cheated on his LEDS exam and encouraged another employee to do so as well — made by one of defendant's employees to create, as plaintiff theorized, a pretextual justification for plaintiff's subsequent termination. Further, although plaintiff alleged that defendant defamed him to interfere with his ability to obtain employment, plaintiff sought damages only for emotional distress and the harm caused to his reputation.
As did plaintiff's defamation claim, the subject matter of plaintiff's blacklisting claim concerns communications about plaintiff's dishonesty and unfitness. Nevertheless, plaintiff's blacklisting claim concerns a different factual transaction. That is so for at least two reasons.
First, plaintiff's blacklisting claim involved communications that occurred over a substantial period of time after his termination that are distinct from the single communication that was the subject of his defamation claim and that the federal court concluded was privileged. Thus, the facts concerning the circumstances surrounding those later communications, including when and between whom they were made, will be different from those adjudicated as part of plaintiff's defamation claim.
Second, the gravamen of plaintiff's federal action was that his termination was wrongful. In that context, plaintiff's defamation claim — which was predicated on defendant's allegedly false statement that plaintiff had cheated on his LEDS examination — functioned as a vehicle for plaintiff to establish that defendant's purported reason for terminating him was pretextual. By contrast, his blacklisting claim alleges that defendant's subsequent communications were motivated by a different purpose — viz., to "disqualify plaintiff from certification as a police officer or corrections officer in the State of Oregon" and to "prevent[ ] plaintiff from securing employment as a police officer or corrections officer in the State of Oregon." The factual bases underlying those distinct motivations will themselves be distinct.
Under such circumstances, we conclude that plaintiff's blacklisting claim was not part of the same factual transaction that had been litigated in federal court. Accordingly, the trial court erred in allowing summary judgment as to plaintiff's blacklisting claim.
In St. Paul Fire & Marine Ins. v. Speerstra, 63 Or.App. 533, 535, 666 P.2d 255, rev. den., 295 Or. 773, 670 P.2d 1036 (1983), the defendants moved for summary judgment against the plaintiffs' claim on statute of limitations grounds. The trial court denied that motion. Id. Thereafter, the plaintiffs twice amended their pleadings, and each time the defendants moved to dismiss. Id. at 535-36, 666 P.2d 255. The court granted the defendants' motions. The plaintiffs appealed, assigning error to the allowance of the motions to dismiss, and the defendants cross-assigned error to the trial court's denial of their summary judgment motion concerning the plaintiffs' original complaint. As to the reviewability of the defendants' cross-assignment of error, we held:
St. Paul Fire & Marine Ins., 63 Or.App. at 536, 666 P.2d 255 (citations omitted).
This case is in the same procedural posture as St. Paul Fire & Marine Ins. Thus, under the reasoning in that case, defendant's cross-assignment of error is reviewable. See also Stilwell v. Seibel, 169 Or.App. 613, 10 P.3d 319 (2000) (reviewing cross-assignment of error concerning the denial of summary judgment where the case was in the same procedural posture as St. Paul Fire & Marine Ins.). Accordingly, we proceed to address the merits of that cross-assignment.
Defendant contends that the trial court erred in concluding that plaintiff's wrongful termination claim was not barred by claim preclusion:
Further, defendant contends that the exception to preclusion that the Supreme Court referred to in Ram II does not apply under the circumstances of this case. As previously noted, 253 Or.App. at 47-51, 289 P.3d at 325-27, when the parties litigated defendant's summary judgment motion in the trial court, they — as did the trial court — relied on our then-recent decision in Ram I. Thereafter, however, in Ram II, the Supreme Court reversed our decision in Ram I. 346 Or. 215, 208 P.3d 950.
In Ram II, the Supreme Court held that Restatement section 25 comment e applies in determining whether a federal judgment precludes claims raised in a subsequent state
(Emphasis added.) The Supreme Court explained that that provision of the Restatement recognized that, "as a general rule, claim preclusion will bar a plaintiff who litigates a federal claim in federal court from relitigating state claims that the plaintiff could have but did not litigate in the federal action." Ram II, 346 Or. at 220, 208 P.3d 950. However, as the Supreme Court noted, the Restatement also recognizes an exception to that general rule.
The Supreme Court concluded that we had erred in Ram I in concluding that the congressional expansion of a federal court's supplemental jurisdiction had effectively superseded the exception identified in the Restatement and required a plaintiff to assert all transactionally related claims in the federal forum. Ram II, 346 Or. at 220-21, 226, 208 P.3d 950. The court explained that, "[t]o be sure, the rule that the Court of Appeals adopted * * * avoids having state courts decide, in retrospect, how a federal court would have exercised its discretion if a plaintiff had sought to litigate his or her state claims under the doctrine of supplemental jurisdiction." Id. at 227, 208 P.3d 950. However, the Supreme Court posited that "state courts are fully capable of making that determination." Id. In sum, the Supreme Court held:
Id.
In light of the Supreme Court's holding in Ram II, defendant now contends that plaintiff did not establish that the federal court clearly would have declined to exercise supplemental jurisdiction over his wrongful discharge claim. Instead, defendant asserts that "[h]ad plaintiff filed a timely motion to amend, the [federal] court undoubtedly would have granted it given the legal standard that governs such motions, and it would have exercised supplemental jurisdiction over plaintiff's [wrongful discharge] claim." For that reason, defendant posits that the exception to preclusion is inapplicable here.
For purposes of our analysis, we assume without deciding that (as defendant posits) plaintiff's wrongful discharge claim arose from the same factual transaction that was adjudicated in his federal action. We indulge in that assumption because, in all events and for the reasons that we explain, the exception to preclusion applies as a matter of law.
Here, plaintiff's motion to extend the discovery deadline in federal court and his colloquy with the federal court during the ensuing hearing alerted the court that plaintiff was seeking additional time for discovery so as to verify the facts necessary to amend his complaint to add the common-law wrongful discharge claim at issue in this appeal. See 253 Or.App. at 43-44, 289 P.3d at 323-24 (setting out colloquy). Thus, plaintiff essentially sought to amend his federal complaint to add a claim for common-law wrongful discharge, and the court refused to allow him to do so. The federal court's intent in that regard is patent from its statements that plaintiff could "file another lawsuit if [he] want[ed] to" and its directive, "[W]e'll try this case on the pleadings that have been filed * * *." Under those circumstances, the federal court,
Having determined that plaintiff's wrongful discharge claim was not subject to dismissal on claim preclusion grounds, we turn finally to plaintiff's remaining assignment of error in which he contends that the trial court erred in allowing judgment on the pleadings against that claim on the ground that he had failed to allege that his termination contravened an "important public duty." On appeal, as before the trial court, plaintiff contends that, among other things, enforcing the criminal laws — which encompasses the prevention and detection of crime — is an important public duty, and that, just as the sheriff was obligated to fulfill that duty, so too was he (plaintiff) required to undertake and promote the enforcement of the criminal laws, including with respect to conduct involving jail inmates.
In determining whether an important public duty exists, we recently explained:
Huber, 235 Or.App. at 242, 230 P.3d 937. Further, we indicated that in Lamson — the case on which defendant's motion for judgment on the pleadings had been predicated — the Supreme Court had
Huber, 235 Or.App. at 243, 230 P.3d 937 (quoting Lamson, 346 Or. at 637-38, 216 P.3d 852) (brackets in Huber; emphasis in Lamson).
We begin by noting that plaintiff's duties derive from the sheriff's. See ORS 204.635(3) (providing, in part, that "[a] deputy has the power to perform any act or duty that the principal has"). For that reason, we begin by describing the duties of a sheriff.
A "sheriff is the chief executive officer and conservator of the peace of the county." ORS 206.010. "In the execution of the office of sheriff, it is the sheriff's duty to[,]" among other things, "[a]rrest and commit to prison all persons who break the peace, or attempt to break it, and all persons guilty of public offenses." ORS 206.010(1). In general, a sheriff also "has custody and control of all persons legally committed or confined in the county local correctional facility of the county
A sheriff must be certified as a "police officer" by the Department of Public Safety Standards and Training.
See also State v. Kurtz, 350 Or. 65, 72, 249 P.3d 1271 (2011) (explaining that, consistently with the plain meaning of the term, a "police officer" is "`a member of a police force'" that is "`entrusted by government with the maintenance of public peace and order, the enforcement of laws, and the prevention and detection of crime'" (quoting Webster's Third New Int'l Dictionary 1754 (unabridged ed. 2002))).
Those statutes express an important public policy — viz., that a sheriff has a public duty to enforce the criminal laws, which includes the prevention and detection of crime.
Here, accepting the truth of plaintiff's allegations,
Reversed and remanded.
However, the court
28 U.S.C. § 1367(c).