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Way v. Aspira Inc. of Pennsylvania

United States District Court, E.D. Pennsylvania

March 20, 2018

JUANITA WAY, Plaintiff,


          GERALD J. PAPPERT, J.

         Juanita Way sued her former employer ASPIRA Inc. of Pennsylvania for wrongful termination in violation of Pennsylvania's Whistleblower Law, 43 Pa. Cons. Stat. §1421, et seq., and wrongful discharge in violation of Pennsylvania public policy. Way contends that she was unlawfully terminated for engaging in protected activities, including objecting to allegedly illegal financial practices and cooperating with a federal investigation. ASPIRA moved for summary judgment. After reviewing the parties' briefs, thoroughly reviewing the record and holding oral argument (during which Way withdrew her wrongful discharge claim), the Court grants the Motion and enters judgment for ASPIRA on the Whistleblower claim.


         ASPIRA is a Charter Management Organization (CMO) that provides management services, including financial, maintenance, staffing and other services, for five charter schools. (Def.'s Mot. for Summ. J., Ex. C (“Way Dep.”) at 12:25-13:8, 29:14- 23, ECF No. 27-6; Def's Stat. of Facts ¶ 24 n.8, ECF No. 27-3.) Way worked as an Accounts Payable Coordinator for ASPIRA from May 2011 until her termination in August 2016. (See Mot., Ex. B, ECF No. 27-5; Mot., Ex. K, ECF No. 27-14.) In her position, Way was responsible for processing invoices, writing checks, securing check signatures, mailing payments in a timely fashion, reconciling disputes with vendors, and handling month-end closes. (Way Dep. at 12:25-13:8, 35:6-8.)

         On December 23, 2015, Way was contacted by the FBI and U.S. Attorney's Office regarding ASPIRA. (Id. at 41:25-42:18.) She was interviewed that day and provided information on ASPIRA's financial practices, including how contractors were hired, how they were paid and whether they performed the designated work. (Id. at 44:1-45:22.) In January 2016, Way told four colleagues about her cooperation with investigators: then CFO Murray Rosenman, consultant Roger Masch, Controller Orlando Rendon and Harold Bickings, ASPIRA's Payroll Manager. (See id. at 12:9-14, 15:15-16:5, 17:22-18:4, 55:10-16, 56:23-57:1, 60:22-25; Mot., Ex. D at ¶ 6, ECF No. 27-7.) Way does not know whether anyone else at ASPIRA knew that she spoke to investigators, although she “assumed” that Rosenman would tell other executives. (See Way Dep. at 62:3-15.)

         In April 2016, Rosenman was replaced by Interim CFO Irv Williamson. (See id. at 15:15-17; Mot., Ex. F at ¶ 9, ECF No. 27-9.) Upon assuming his role, Williamson took issue with “how accounts payable was functioning at the time.” (Way Dep. at 19:8-16; see also id. 20:10-20; Ex. F at ¶ 10.) Specifically, it was revealed that ASPIRA was unintentionally $1.2 million past due on payments to Keystone, its health insurance provider. (See Way Dep. at 19:17-25; Ex. F at ¶ 11-12.) ASPIRA and Keystone subsequently agreed on a payment plan to remediate the debt; in exchange for a reduced balance of $900, 000, ASPIRA agreed to pay off the debt in installments over a 12 month period, in addition to its monthly premium payments. (See Way Dep. at 19:17-21:17, 31:5-10; Ex. F at ¶ 12-14.)

         Way alleges that over the following months, she was asked to engage in financial improprieties for ASPIRA on two occasions. First, Way claims that in May 2016 Williamson asked her to remove the $900, 000 debt owed to Keystone from ASPIRA's books and apportion it to its five charter schools. (See Way Dep. at 29:6-13, 30:23- 31:10, 72:3-14.) Way understood this as an attempt by ASPIRA executives to manipulate ASIPRA's books to make its financial health appear more favorable so that it could secure the bond funding it needed to acquire a target college. (See Id. at 63:3- 64:8, 66:6-13.) She further alleges that she felt this was improper because “[t]hese were not the school's bills” and “they shouldn't have to pay more if it wasn't their employees.” (Id. at 32:15-22.) Way claims she told Williamson and Rendon that she was concerned about this practice but ultimately complied with the request. (See Id. at 32:6-10, 66:6-14, 72:15-18.) Way made no other reports about this conduct prior to her termination. (See Id. at 67:11-25, 68:11-16.)

         The second alleged financial impropriety is that on one occasion in the summer of 2016, Williamson apparently asked Way to pay a contractor who had already been paid. (See id. at 70:1-17.) Way testified that:

He gave me the invoice, [told] me he needed a check right away, I went to enter it . . . found out it was the exact same invoice . . . took it back to him saying, “I can't pay this, it was already paid[.]” He instructed me that I needed to get a check to that person, and I said I couldn't do it unless I had an invoice to pay it against.

(Id. at 70:1-17.) Way does not know whether the vendor was ultimately paid twice but stated that she never issued a second check. (Id. at 71:5-13.) There is no evidence that Williamson ever pursued the matter further and Way did not identify any other individual to whom she reported this conduct. (Id. at 70:1-71:15; Ex. D at ¶ 3, 5.)

         In August 2016, Keystone terminated ASPIRA's health insurance coverage, which left its employees and the employees of its charter schools without health insurance for approximately two weeks. (Way Dep. at 34:24-35:2; Ex. F at ¶ 25, 28.) The parties dispute the reasons for Keystone's decision; however, the parties agree that Keystone did not receive a payment by the date required in the negotiated payment plan. (See Way Dep. at 34:24-35:2; Ex. F at ¶ 25.) ASPIRA asserts that Way failed to obtain the needed signatures and failed to mail the check by the required deadline. (See Ex. F at ¶ 26; Ex. K.) ASPIRA contends that Keystone's termination of coverage was based on the lack of timely payment under the payment plan. (See Ex. F at ¶ 25.) Way feels that she was not responsible for the late payment because she told Williamson that the checks were not signed in time and that Keystone's decision to terminate coverage was actually based on ASPIRA's decision to switch insurance carriers. (See Way Dep. at 35:3-5, 36:1-12, 37:1-20.) Way states that when ASPIRA sent Keystone a letter of cancellation after the two parties had negotiated the payment plan in good faith, Keystone declared the payment plan null and void, and demanded payment of ASPIRA's debt in full. (See id. at 37:1-20.)

         Way was fired on August 25, 2016. (Ex. K.) Thomas Darden, ASPIRA's COO, made the decision to terminate Way based in part on Williamson's recommendation. (Ex. F at ¶ 2, 29; Mot., Ex. G at ¶ 27, ECF No. 27-10.) Way's termination letter states she was fired because her “failure to perform [her] assigned duties contributed to [a] critical vendor cancelling a key insurance policy, which resulted in significant harm to the organization's reputation, and exposed employees to unnecessary and potentially significant insurance related risks.” (Ex. K; see also Way Dep. At 72:23-25.) Williamson and Bickings were the only people employed by ASPIRA who knew of any of Way's alleged protected activities at the time of her termination. (See Way Dep. at 17:14-21, 56:11-57:1.) Bickings never supervised Way during her employment. (See id. at 57:2-3.)

         On February 7, 2017, Way filed a two-count Complaint alleging wrongful termination in violation of the Whistleblower Act and Pennsylvania public policy. (Compl.) Way claims that she was fired for a “culmination” of activities, including (1) participating in the federal investigation of ASPIRA's financial practices, (2) objecting to ASIPRA's distribution of the $900, 000 insurance debt to its schools, and (3) refusing to engage in the overpayment of a contractor. (Id.) ASPIRA contends that Way has not established a prima facie case under the Whistleblower Act, fails to show that ASPIRA's explanation for her discharge was pretextual, and that Way cannot recover on a common law wrongful discharge claim for allegedly illegal conduct in which she participated. Faced with the record evidence supporting ASPIRA's position on the wrongful discharge claim, Way's counsel withdrew it during oral ...

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