Lousiana College Did Not Renew Its Executive Vice President's Contract After He Accused His Boss of Misdirecting Funds to Tanzania - Is That Wrongful Termination?

| Marcus, Ellen


Regular readers of Suits by Suits know that employees – including executive-level employees with lucrative employment contracts and low-level employees who are at-will and have no contract – may claim wrongful termination against their former employers if the employees were fired in violation of “public policy.”  Recently, the former Executive Vice President of Louisiana College, Timothy Johnson – who had an employment contract with the College – filed a lawsuit alleging that the College retaliated against him after he raised concerns that the College’s President misdirected the contributions of a large donor to a project in Tanzania. A link to Johnson’s complaint is in this recent report about the lawsuit.  A photo taken in the Serengeti National Park in Tanzania is above.

Johnson claims that the College did not renew his contract after he blew the whistle on the President’s alleged wrongdoing.  This raises an interesting question:  even assuming that an employer did not renew an employee’s contract in retaliation for reporting alleged wrongdoing, is non-renewal of a contract grounds for a wrongful termination claim?  A California appeals court has said that is not, in the case brought by Nicollette Sheridan of Desperate Housewives that we featured in our first post:

Sheridan cannot pursue a cause of action for wrongful termination in violation of public policy because, contrary to what she claims, she was not fired, discharged or terminated. Instead, Touchstone chose only not to exercise its option to renew her contract for the next season.

See Touchstone Television Productions.

In other words, at least one high court in the land believes that a wrongful termination claim must be based on a “termination.”  That’s something for employers to keep in mind when they are considering the implications of not renewing the contract of an employee who complained of wrongdoing, and for employees to keep in mind if they think that their employer did not renew their contract for the wrong reasons.