Shaddy v. Brattleboro Retreat, 2012 VT
67
Most of us do not make it
through elementary school without getting caught, at least once, with our hand
in the cookie jar. Whether we are busted with the cookie firmly in our grasp or
with only the aroma of freshly-baked, chocolate chips emanating from our
breath, our reprieve will often depend more on what we say and how we say it—even
more than the evidence mom can clearly perceive.
Blame it on a mother’s
unconditional love, classic denial, or that second glass of wine she chugged
just before you hopped off the bus, but if there is any rational explanation
for your otherwise indisputable wrongdoing, she will want to accept it as true.
Today’s case demonstrates that,
indeed, what you say (or don’t say) and exactly how you say it can make all the
difference in the outcome of your case. It also proves that your mother was
right when she said “if you don’t have anything nice to say about someone, it
is better to say nothing at all.”
Here are the facts. From September 2007 until January 2008,
Plaintiff worked for Defendant as a nurse. During that time, Defendant
discovered that someone with access to its medication room was tampering with
packets of Adderall XR, a regulated drug. Thereafter, Defendant reviewed its
employees’ work schedules, and observing a pattern, targeted Plaintiff as the
culprit.
To prove Plaintiff was the
wrongdoer, Defendant organized a sting operation, which left him solely in
charge of the medication room. In what
can only be described as something well short of a covert operation, Defendant
instructed all the other nurses not to enter the medication room during
Plaintiff’s shift unless they were directly supervised by another nurse. Not
surprisingly, when Plaintiff’s shift was over, Defendant determined that the
Adderall XR had once again been tampered with consistent with earlier
incidents. Since it was beyond the realm
of human possibility that two nurses, who had been advised in advance about
Defendant’s sting operation, would conspire to protect their own prior wrong-doing
(wink, wink, nudge, nudge), Plaintiff was fired for tampering with the drugs.
Shortly thereafter, Plaintiff
sought unemployment-compensation benefits from the Department of Labor. The
Employment Security Board initially denied Plaintiff’s request for unemployment
benefits, finding that he was fired for gross misconduct. Plaintiff
successfully appealed
the Board’s denial to the SCOV. Following a remand, the Board once again
found Plaintiff was not eligible for benefits given his gross misconduct.
Plaintiff renewed his appeal, but the SCOV affirmed the
Board’s denial, finding sufficient evidence to support the Board’s
decision.
In addition to being fired,
Plaintiff was criminally charged in the Windham Criminal Division and subject to
disciplinary proceedings before the Board of Nursing. Plaintiff’s criminal
trial ended with a hung jury. He subsequently pled no contest to an amended
possession charge. The Board of Nursing proceedings were resolved by a
Stipulation and Consent Order—signed by Plaintiff—that asserted he had engaged
in wrongdoing, which “included, but was not limited to, diverting supplies,
equipment, or drugs for personal or other unauthorized use.” The Consent Order
also contained a provision which stated that the Plaintiff neither admitted
liability nor disputed that the State could prove its charges by a
preponderance of the evidence. That might have been the end of it, except . . .
.
In January 2011, Plaintiff sued
Defendant and several of its employees for defamation, obstruction of justice,
intentional infliction of emotional distress and intentional interference with
a contract. Plaintiff’s defamation claim alleged that Defendant, through
several employees and on multiple occasions, falsely asserted that Plaintiff
was the only person who could have diverted, and, therefore, did wrongly divert
Adderall XR.
Defendants sought to dismiss
Plaintiff’s complaint on multiple grounds, but primarily through the doctrine
of res judicata, which prohibits parties who have already fought the good fight
from getting a second bite at the cookie. Defendants claimed that each of
Plaintiff’s allegations either were or could have been litigated in the prior
administrative proceedings or at his criminal trial.
The trial court granted
Defendants’ motions and dismissed Plaintiff’s complaint, concluding, among
other things, that Plaintiff’s claims were based on the same conspiracy theory
and false assertions that he had previously alleged in his defense in the other
proceedings.
On appeal, Plaintiff challenges
only the trial court’s application of the doctrine of res judicata to bar his
defamation claim. In particular, Plaintiff claimed that Rule 410(2) of the
Vermont Rules of Evidence and 21 V.S.A. § 1353 expressly bar the subsequent use
of his prior criminal plea and administrative settlements against him in a
civil suit. Plaintiff also asserted that since Defendant was not a party to the
prior administrative proceedings or in privity with the Attorney General’s
office, his defamation claim was not barred.
The SCOV holds that Plaintiff’s
no contest plea to the amended charge of possession of a stimulant cannot
operate as a bar to his defamation suit since Rule 410(2) of the Vermont Rules
of Evidence prohibits the use of a nolo contendere plea against a defendant in
any civil proceeding.
Likewise, the SCOV holds that
the Employment Security Board’s prior determinations cannot preclude
Plaintiff’s defamation claims given that 21 V.S.A. § 1353 expressly states that
the Board’s decisions are neither conclusive nor admissible in separate or
subsequent actions between the former employee and his or her former
employer. In effect, what happens at the
Board stays at the Board.
This leaves the stipulation with
the Board of Nursing on which the ultimate outcome of Plaintiff’s appeal turns.
As an initial matter, while the
trial court employed the doctrine of res judicata as a bar to Plaintiff’s suit,
the SCOV points out that the operative doctrine is actually collateral estoppel
(also known as issue preclusion) rather than res judicata. This is really a minor
distinction. Res judicata concerns
larger claims while collateral estoppel focuses on facts or specific issues.
But the test for each is slightly different.
Nevertheless, the SCOV agrees
with the trial court that Plaintiff had a full and fair opportunity in the
earlier proceedings to contest the allegations against him. Thus, it would be unfair for Plaintiff to now
contest those charges. While it would be reasonable for one to assume that this
signals the death knell for Plaintiff’s defamation claim, the SCOV finds that
the prior Consent Order nevertheless fails to establish the truth of
Defendant’s accusations.
Huh? I know what you are
thinking. Didn’t we just establish that Plaintiff diverted the cookie from the
cookie jar and had his bite?
Remember, sometimes what you say
and exactly how you say it makes all the difference. Regardless of whether a stipulated
administrative judgment can, in fact, preclude some future issue or action—an
issue the SCOV reserves for another day—the stipulation must, at a minimum,
precisely set forth the legal and factual issues it purports to resolve.
Let’s look closer. While it is undisputed that Plaintiff admitted
to wrongdoing in the stipulation, he never actually admitted that he wrongfully
diverted drugs on three separate occasions as Defendant’s and its employee’s
defamatory statements specifically alleged. As such, the SCOV concludes that
the prior Consent Order lacks the requisite specificity and does not bar
Plaintiff’s defamation suit.
Case is reversed and remanded to
the trial court for additional litigation.
Stay tuned everyone. Shaddy v. Brattleboro Retreat, episode
4, is likely coming to the SCOV near you in summer 2013. In the meantime, it is
probably safe to assume that the importance of what you say and exactly how you
say it applies to the accuser just as much as to the accused.
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