United States District Court, D. Arizona, Prescott Division
RONNIE D. STILWELL and COURTNEY STILWELL, Plaintiffs,
CITY OF WILLIAMS, et al., Defendants.
H. RUSSEL HOLLAND, District Judge.
Motions for Partial Summary Judgment
Plaintiffs move for partial summary judgment. This motion in opposed,  and defendants move for summary judgment on all of plaintiffs' claims. Defendants' motions are opposed. Oral argument was requested and has been heard.
Plaintiffs are Ronnie D. and Courtney Stilwell. Defendants are the City of Williams; Joseph and Lyda Duffy; Raymond Glenn and Elsie Cornwell; Billy and Bessie Pruett; and Kathy and Tracy Fuller.
Plaintiff Ronnie D. Stilwell (hereinafter "Stilwell") was employed as the City's Water Superintendent. The City's Employee Manual provides that City employees are "at will" employees and that "[t]he employment relationship may not be changed from the at will' status by any document or statement, or by any employee of the City, unless such a change is specifically approved and adopted in writing by [the] City Council." The City's Employee Manual further provides that "[t]he City or the employee may terminate the employment relationship at any time for any reason whatsoever or for no reason[.]" Also, Section 1.04 of the City's Employee Manual provides that "[a]ll City employees regardless of type, are employees at-will', consistent with the public policy of the State of Arizona and as defined in Ariz. Rev. Stat. Ann. § 23-1501, et seq." In addition, Article 9.03(a) of Ordinance No. 850, which was passed on January 26, 2006, provides that "[e]mployees who do not have an individualized written employment contract are employed AT THE WILL OF THE CITY OF WILLIAMS and are subject to termination of employment at any time, for any reason not unlawful, with or without cause or notice."
Section 7 of the City's Employee Manual sets forth an appeal process for disciplinary actions for classified employees. Prior to January 2006, the Water Superintendent was a classified employee. In January 2006, the Water Superintendent became an unclassified employee. However, Williams City Code Article 2.2.12(d) continued to provide that "[f]or purposes of personnel actions, the Water Superintendent shall be a classified' employee."
On April 21, 2006, Stilwell acknowledged that he had received a copy of the City's Employee Manual and that he had "read it and will abide by the policy as set forth."
In 2008, Carolyn Smith, who was the City's HR director, filed suit against the City, Duffy, and others, alleging that she had been discriminated against because she raised concerns that Cornwell was being discriminated against because of his age. Stilwell was disclosed as a witness in the Smith case. At his deposition in this case, Stilwell stated that he "was going to testify on what I observed Dennis Wells and Joe Duffy, how they treated Carolyn Smith." Stilwell was never deposed in the Smith case and never testified at trial. On August 13, 2009, he did, however, make a sworn statement regarding his observations of how Duffy and Wells treated Smith.
On July 31, 2009, Stilwell was given a reprimand and an unpaid three-day suspension for installing a vehicle lift in the Water Department without first having received permission to install personal equipment on City property. On August 10, 2009, Stilwell asked Susan Kerley, the City HR Director, if, as an unclassified employee, he could file an appeal of his suspension and if the City Manager could suspend him without the City Council's approval. On August 10, 2009, Stilwell submitted an appeal to Kerley. On August 31, 2009, Kerley advised Stilwell that his reprimand and suspension were being overturned. Stilwell avers that Kerley told him that "the disciplinary documents resulting in the reprimand would be taken out of my personnel file and that I would receive back pay for the 3-day pay loss."
Stilwell avers that
[s]hortly after my meeting with... Kerley on August 31, 2009 and less than a week after the City of Williams and Duffy would have received a copy of my sworn testimony in the... Smith case, I began experiencing retaliation and adverse actions from Duffy and Wells in the form of failure to reinstate my three days of lost pay, failure to remove any disciplinary documents resulting in my reprimand from my personnel file,  and treating me rudely and hostilely.... At his deposition, Stilwell testified that Duffy treated him as "an outsider, refused to, to work with me; just basically made me feel not welcome at the city of Williams." Stilwell testified that Duffy would walk out of the room when he entered, give him dirty looks, and not even say good morning.
On September 10, 2009, Stilwell's attorney sent "a letter to the City Manager's Office... requesting that the harassment stop and that management, including Duffy, treat [Stilwell] with respect and thereby improve the conditions of [Stilwell's] work place."
On September 15, 2009, Duffy sent an email to Wells and Kerley in which he reported that Stilwell had made an inappropriate gesture the day before in connection with his asking whether he needed to go do a UA. Duffy stated that "[s]ince [Stilwell] is falsely accusing us of hostile behavior, I think we should begin documenting all of his inappropriate behavior."
On December 24, 2009, Stilwell advised the City's attorney that Stilwell's attorney wanted him to "sign a 11 page declaration with regards to the Carolyn Smith case", that he did not feel comfortable signing the declaration, and that "[i]f at all possible I would like to be excluded from this case." In the email, Stilwell stated that his issues with Duffy had been resolved and that he and Duffy were "moving forward working as a team once again."
Stilwell avers that "[a] motion to prevent [his] testimony" was "filed in the Smith case, but on June 1, 2010 the judge in the Smith case denied the motion, resulting in the fact I might be ordered to testify." Stilwell avers that he had a meeting with Duffy after the June 1, 2010 order was issued at which
Duffy stated he preferred I could find some way not to have to testify. Duffy specifically told me: I've got your back and you've got my back, ' meaning to me that Duffy was attempting to coerce me to support him and the City regarding the Smith case by not testifying, and if that support was forthcoming, Duffy would take care of me in my job.
In August of 2010, Stilwell avers that he gave defendant Billy Pruett, who worked in the Water Department, two verbal warnings. The first verbal warning was for diluting wet samples. The second was for giving defendant Kathy Fuller, who was also an employee in the Water Department, preferential treatment; leaving blower belts on the floor of the waste water treatment plant (WWTP); failing to calibrate certain equipment; and failing to learn maintenance procedures for the WWTP. Stilwell avers that after he gave Pruett these two verbal warnings, Pruett "seemed to hold a grudge against [him] and was not [as] friendly with [him] as he had been in the past."
Stilwell avers that it was also in August 2010 that he began to suspect that Pruett and Fuller were having an affair. On August 23, 2010, Stilwell emailed Kerley to ask for advice on how to handle the situation. Randy Stilwell, Stilwell's brother who also worked for the City, avers that he too believed that Pruett and Fuller were having an affair.
In September 2010, Stilwell avers that at a meeting with Tim Pettit, another City employee, the subject of Stilwell's possible testimony in the Smith case came up and Stilwell told Pettit that if he were called to testify, he "would have to tell the truth about how Duffy and the former City Manager retaliated against [Smith] in order to try to get her to quit." Stilwell avers that "[s]hortly thereafter I had another confrontational discussion with Duffy who expressed extreme displeasure with me for agreeing to testify if Smith called me to the witness stand. [Duffy] implied by actions and words that my job was in jeopardy."
Stilwell avers that in October and November 2010, he continued to receive emails from Duffy and Wells, in which he was "accus[ed]... of unwarranted poor job performance" and which "mad[e] [his] workplace unpleasant." For example, on October 18, 2010, Duffy wrote a memo to Stilwell about the lack of security at the water plant and advised the City council that he gave the memo to Stilwell, even though Stilwell contends that he never got the memo. Stilwell advised defendant Glenn Cornwell, who was Stilwell's immediate supervisor, that he thought Duffy was doing things like this just to harass him. Pruett testified that during this time, Stilwell did mention that Duffy and Wells were "after him" but he did not recall why Stilwell felt that way or why Stilwell thought Duffy and Wells were after him.
On October 29, 2010, Stilwell emailed Cornwell about two Bearizona employees making a rude gesture as he (Stilwell) was driving by. Stilwell avers that "Cornwell told [him] to go to Bearizona in Williams to report this matter to the supervisor of these folks, which I did that same day, with Mr. Pruett and Ms. Fuller as witnesses" and that he "acted professional but concerned in making this complaint with a female supervisor of these gentlemen...."
On November 2, 2010, Stilwell told Cornwell that he was going to begin working on employee evaluations. Stilwell avers that he "decided to write a negative [evaluation] for Mr. Pruett because of his August verbal warnings and his bad attitude in the workplace since that time." On November 27, 2010, Stilwell avers that he "discovered that the [Water Treatment Plant] was in serious disarray when it had been under the control of Billy Pruett and Kathy Fuller that day." Because of this, Stilwell "determined to make Mr. Pruett's job performance evaluation worse" and on November 29, 2010, Stilwell advised Cornwell that he was going to "[r]ewrite [the] employee evaluations[.]" Dan Curtis, a Water department employee, avers that "during the last month before Mr. Stilwell's suspension in December 2010, Mr. Pruett and Ms. Fuller were very angry at Mr. Stilwell by their actions, words used, and demeanor. I remember that Mr. Stilwell ordered Ms. Fuller to do janitorial work on the weekends and to paint paddles, which she did not want to do."
On December 9, 2010, Duffy wrote a memo to Kerley regarding a meeting he had with Pruett that day. Duffy told Kerley that Pruett "informed [him] that the employees of the department were afraid of their supervisor and of city hall. They are being led to believe that their jobs were on the line and that everyone was after them." Duffy stated that Pruett was "representing the concerns of the employees within the department" and that Pruett had "felt that the stress level was so high that he was afraid he might have a heart attack." Duffy wrote that "[w]e've had indications in the past that Ron Stilwell managed his department with threats and intimidation, and that the department's work environment may be hostile." Duffy "recommend[e]d that [the City] conduct an investigation into these allegations to ensure that our employees are working in a safe environment." Pruett testified that he did not tell Duffy that he felt like Stilwell was trying to get him fired and that everybody in the Water Department felt like their jobs were on the line, that he had not been thinking of resigning, that he was not concerned with having a heart attack, and that he did not recall if he used the words "hostile environment."
On December 9, 2010, Duffy also began a "log of events" relating to Stilwell. The log shows that after talking with Pruett on December 9, Duffy got a call from the mayor, who had received a call from Vanessa at Bearizona, who lodged a complaint against Stilwell. Duffy spoke with Vanessa later that day and he also spoke with Fuller, who "said she had had enough of the harassing and inti[m]idat[ion] that was going on." After the council meeting that day, Duffy met with the City attorney, Cornwell, Kerley, and the Chief of Police "to plan how and when we would give Ron notice of the suspension with pay." Duffy testified that he had made the decision to suspend Stilwell with pay sometime during the afternoon of December 9.
On December 10, 2010, Stilwell was placed on paid administrative leave pending an investigation into the allegations of misconduct. Stilwell avers that he was not told the nature of the alleged misconduct. While on administrative leave, Stilwell was "expected to make [himself] available between 8:00 a.m. and 5:00 p.m. Monday through Friday" and was "ask[ed]" to "relinquish all City vehicles and keys, property and equipment, except" for his "City-issued cell phone so that" the City could contact him.
The City hired Erin Byrnes, a Phoenix attorney, to conduct the investigation of Stilwell. Brynes completed her report on January 3, 2011. Byrnes once worked at the same firm as Kellie Peterson, the City attorney. Byrnes had one or two conversations with Duffy prior to coming to Williams to conduct her investigation during which Duffy told Brynes the following: 1) Stilwell had been arrested for domestic violence, 2) Pruett and Fuller had told Duffy that Stilwell had created a hostile work environment and allowed the ongoing sexual harassment of Fuller, 3) Stilwell had buried asbestos pipe, 4) Stilwell had manipulated test results, 5) Stilwell was a former jock, who ran his department like a football coach, 6) Stilwell's performance vacillated between good and bad, 7) Stilwell was a master at protecting himself and being manipulative, 8) Stilwell had considered resigning, and 9) Stilwell was accused of falsifying Arizona Department of Environmental Quality (ADEQ) results.
Brynes interviewed Pruett, Fuller, Dan Curtis, Mike Tissaw, Stilwell, and Randy Stilwell. Byrnes testified that she did not recall who made the list of persons to be interviewed and that she did not recall if Stilwell asked her to interview an additional 5-6 people.
In the Executive Summary of her investigative report, Brynes wrote that she believed
the Water Department to be rife with serious misconduct warranting immediate City attention. Mr. Stillwell [sic] runs his Department by expressly and impliedly intimidating his employees. He makes them believe that City administration wants to fire them, and that he is the only one who can save them. This environment causes employees to be in a state of near constant fear for their jobs and leaves them completely unwilling to respond to widespread wrongdoing within the Department.
...Some of [the Water Department's male employees] directly sexually harassed Ms. Fuller by sexually proposition[ing] her, while others engaged in sexual talk about her. She became aware of this about the same time as she found completing all her regular duties, in addition to assigned janitorial duties, impossible.
Some of the male employees, led primarily by foreman Dan Curtis, became frustrated [that] Ms. Fuller was not doing all of her janitorial duties. This coincided with that group's development of a suspicion that Fuller and Mr. Pruett were having an affair. The group perpetuated this rumor, while simultaneously intentionally ostraciz[ing] Pruett and Fuller from the rest of the Department.
As a separate matter, I also verified that Department employees have falsified tests submitted to the State at Mr. Stillwell's [sic] direction. They have also buried hazardous materials on City grounds, again at Stillwell's [sic] direction.
... Based on the facts detailed below, I recommend that Mr. Stillwell [sic] be terminated immediately and the City consider taking the same action, or some lesser form of discipline, with regards to Mr. Curtis.
In the "facts" section of her report, Brynes discussed the allegations about Stilwell's management style. She noted that "Pruett may have either exaggerated some in his accounting of events, either because of his ability to finally see this matter addressed, or because he is predisposed to view things as more serious having been subjected to maltreatment for a significant period of time[.]"
As for the falsification of wet samples, Brynes stated that Pruett said "that within the past five years, Mr. Stillwell [sic] has required him to falsify the wet test samples that the Department submits to ADEQ" but that Stilwell said that "Pruett independently decided to falsify samples." Tissaw told Brynes that it was Pruett who told him to "cheat" on the testing, but that "[a]nything that Billy [Pruett] said, you could figure came from" Stilwell. Based on this information and the fact that other employees told her that "Pruett is essentially incapable of making a decision independently, particularly a difficult or controversial one, " and the fact that Fuller "provided information about concerns expressed by a lab the Department uses for other testing in Flagstaff regarding Mr. Stillwell's [sic] willingness to truthfully report test results to ADEQ", Brynes concluded that Stilwell "was behind the falsification of wet samples, even if he did not, himself, do the falsifying." Brynes also noted that Stilwell "did not indicate that he had taken any disciplinary action against Mr. Pruett, nor did he tell me of any remedial steps he had taken to ensure the samples would not be falsified in the future." At her deposition, Brynes acknowledged that Stilwell had shown her his notes and the photographs related to the November 27, 2010 incident at the Water Treatment Plant and that she could only speculate that she did not write in her report that she had seen this information "because [she] did not think that they were relevant to the scope of my investigation." Brynes also testified that her notes for her interview of Randy Stilwell indicate that he told her he saw Pruett "falsify testing with distilled water",  but she did not include this information in her report.
As for the burying of the asbestos pipe, Pruett told Brynes that Curtis and Stilwell buried the pipe; Curtis told her that he and Pruett buried the pipe at Stilwell's direction; and Stilwell told her that Pruett and two other former employees buried the pipe "in direct contravention to his directive to double bag it, per regulations, and transport it to St. [Joseph's]... for proper disposal." Brynes concluded that "[i]t appears that Dan Curtis and Bill Pruett were probably involved in burying the pipe and that it was done at Mr. Stillwell's [sic] direction" but that "[r]egardless of who buried the pipe, it is clear it is still on City (or federal property), that Mr. Stillwell [sic] knows it, and yet took no action to rectify what may be a violation of both federal and state law." Curtis, however, avers that Stilwell gave him, Pruett, and two other employees a verbal reprimand, and told them "in a group setting that, if any of us were ever involved with anything like this again, we would get written up and that what we did was against the law. Mr. Stilwell also told us in this group setting that he had informed Mr. Joseph Duffy about this unlawful burial but that Mr. Duffy did not want them to incur any further expense in removing the AC pipe and disposing of it properly."
In the "fact" section of her report, Brynes also included Pruett's and Fuller's "belief" that Stilwell was using drugs and that all of the employees reported that he was "routinely not at the office between regular Department hours."
On January 5, 2011, Stilwell was terminated. Duffy, who was the interim City manager at the time, testified that the decision to terminate Stilwell was made by himself; Peterson, Kerley, and Cornwell. Kerley, however, testified that Duffy alone made the decision to terminate Stilwell,  and Cornwell testified that he was not involved in the decision to terminate Stilwell. Stilwell was given a termination letter signed by Cornwell. Cornwell testified that Duffy and Kerley gave him the letter to sign and asked him to sign it because if Stilwell appealed his termination, "the appeal would go to acting city manager Joe Duffy."
The termination letter advised Stilwell that he was being terminated "based on the receipt of complaints from employees and the general public." The letter explained that Stilwell was being terminated for "fail[ing] to properly supervise the work and activities of the Water and Wastewater Departments" because he had
1) failed to address known problems of sexual harassment in the workplace;
2) required employees to engage in the falsification of wet testing and/or failed to take corrective action when he became aware of said falsification;
3) required employees to improperly dispose of hazardous materials and/or failed to take corrective action when he became aware that employees had done so;
4) manipulated equipment to avoid proper recording of water treatment volumes;
5) used "threats and intimidation to manage employees thereby creating an environment wherein employees were fearful for their jobs and afraid to report any wrongdoing ...