Defense Contractor Whistleblower Retains $1 Million Compensatory Damages Verdict

Update: On July 22, 2022, the Tenth Circuit affirmed the jury verdict and the decisions of the district court.  In particular, the court held:

• a change in responsibilities, combined with a decrease in reputation and job prospects, can constitute an adverse employment action; and
• the damages that the jury awarded were not excessive: “[Raytheon] falsified information for use by the United States military—this, if left unchecked and undiscovered, could have far-reaching repercussions. Then, when an employee attempted to report the falsification, it removed him from his data-collection role entirely. This is a serious violation of the DCWPA.”

In December 2019, a jury awarded former Raytheon engineer Bruce Casias $43,000 in back pay and $1M in compensatory damages in a Defense Contractor Whistleblower Protection Act (DCWPA) case.  Raytheon moved for judgment as a matter of law or, alternatively, to reduce the compensatory damages verdict from $1 million to $50,000.  Judge Blackburn denied the motion for a new trial and declined to reduce the $1 million compensatory damages verdict, even though Casias did not suffer economic damages and the jury relied mainly on Casias’ testimony to determine the amount of compensatory damages.

Casias underscores the robust protection that the DCWPA provides to whistleblowers at DoD contractors and the potential of uncapped compensatory damages to provide an effective remedy for the reputational harm and emotional distress that whistleblowers often suffer.

A Reassignment That Does Not Affect Pay Can Be Materially Adverse

Casias worked as a lead test engineer on Raytheon’s contract with the United States Air Force to produce the next generation of satellites — the GPS OCX Program.  In 2015, he encountered defects preventing the successful completion of test procedures.  When Casias raised concerns about the defects, his supervisor directed him to change the failed procedures from “incomplete” to “complete.”  Shortly after raising concerns about fraudulent reporting on the status of testing, Raytheon demoted Mr. Casias by reassigning him from his post as manager of the GPS OCX Program to a lower-level role in the GPS OCX Program developing software scripts.  The number of employees under his supervision decreased from 35 to two.  Mr. Casias deemed his new position a “dead-end reassignment.”  A few months after being demoted, Mr. Casias resigned and obtained a position at a Raytheon competitor.

Raytheon argued that because Casias’s reassignment resulted in no loss of pay, benefits, title, or grade, it could not be deemed sufficiently materially adverse to constitute an adverse employment action.  Judge Casias found sufficient evidence supporting the jury’s determination that the demotion was actionable because:

• As a result of the reassignment, Casias was left supervising only three people and lost 90 percent of his previous responsibilities. According to Casias,  the reassignment was akin to “being put in a corner and basically given nothing to do.”
• Casias’s coworkers also testified that they perceived the reassignment as a demotion that would have negative repercussions for Casias’s career.

This decision underscores the broad range of retaliatory personnel actions prohibited by the DCWPA, i.e., any act that might dissuaded a reasonable worker from engaging in further protected conduct.  As the scope of DCWPA prohibited retaliation is broad, whistleblowers should identify all retaliatory personnel actions in a DCWPA retaliation complaint to ensure exhaustion of remedies at the DoD Office of Inspector General.

Six Months Temporal Proximity Suffices to Prove Contributing Factor Causation

In moving for judgment as a matter of law, Raytheon asserted that the evidence is insufficient to support a causal connection between Casias’s November 2015 complaint and the May 2016

decision to reassign him.  Although approximately six months elapsed between the time Casias raised concerns to his supervisor and the time that Raytheon demoted him, the adverse action was sufficiently proximate in time in light of the context surrounding Raytheon’s actions.

First, Casias raised his concerns again with his supervisor (after his initial disclosure) on two or three subsequent occasions.  Second, there was evidence from which the jury could conclude that Casias’s supervisor was hostile toward his complaints.  According to Casias, his supervisor became angry with him and raised his voice when Casias questioned whether the directive to mark the test reports as completed was ethical.  Indeed, the supervisor admitted that he admonished Casias for raising the issue during a leads meeting and acknowledged he became increasingly frustrated with Casias during the intervening months.  In addition, the jury could infer pretext in Raytheon’s asserted reasons for the reassignment.

$1 Million Compensatory Damages Award Sustained

Raytheon asserted that the jury’s award of $1 million of compensatory damages was unsupportable and that the award should be reduced to $50,000.  Judge Blackburn, however, found that Casias’s testimony provided sufficient evidence to support the award:

• Casias lost weight and sleep, and his blood pressure fluctuated.
• Casias characterized the situation as “unbelievably stressful” and that the stress contributed to his divorce.
• He also claimed that the whole episode was emotionally and physically “devastating” and personally “destructive.”

Denying the motion for remittitur, Judge Blackburn noted that he “cannot find that Mr. Casias’s professional integrity and personal dignity, let alone the loss of his marriage and the emotional and physical stress his circumstances caused him, are not worth the jury’s estimation.”

In addition, Judge Blackburn rejected Raytheon’s argument that the jury should have considered whether Casias sought medical or other professional assistance in connection with his emotional and psychological distress.  The testimony of a treating physician or psychologist is not a “dispositive requirement” to obtain emotional distress damages, and Casias was not required to provide corroboration of his testimony to support an emotional damages award.

Backpay Award Vacated

Raytheon’s post-trial motions succeeded in modifying one aspect of the jury’s verdict.  Due to Casias waiving his right to proceed on a constructive discharge theory, he could not recover backpay for the difference between the salary and benefits of his position at Raytheon and those of the position he took after leaving Raytheon.  And because the demotion did not result in a reduction in Casias’s pay, he did not suffer any economic damages during his employment at Raytheon.  Accordingly, Judge Blackburn vacated the award of $43,000 of backpay.

Respecting the Role of the Jury

In denying Raytheon’s motion for remittitur, Judge Blackburn made some refreshing comments respecting the role of the jury:

• “As a firm believer in the inviolability of the Seventh Amendment, and in light of the evidence presented at trial, I cannot say the jury’s award so shocks the conscience that it would be appropriate to substitute my judgment for that of the jury on this issue. See Malandris v. Merrill Lynch, Pierce, Fenner & Smith Inc., 703 F.2d 1152, 1170.

• “[A]ny suggestion that there is some upper limit to permissible non-economic damages in this circuit seems to this court as fundamentally at odds with the precepts of the Seventh Amendment.” See Feltner v. Columbia Pictures Television, Inc., 523 U.S. 340, 353, 118 S.Ct. 1279, 1287, 140 L.Ed.2d 438 (1998) (‘The right to a jury trial includes the right to have a jury determine the amount of [] damages . . . .  Thus, . . . the common law rule as it existed at the time of the adoption of the Constitution was that in cases where the amount of damages was uncertain[,] their assessment was a matter so peculiarly within the province of the jury that the Court should not alter it.’) (quoting Dimick v. Schiedt, 293 U.S. 474, 480, 55 S.Ct. 296, 298, 79 L.Ed. 603 (1935)) (internal quotation marks and citations omitted).”

• “‘[A] jury’s determination of fact is considered inviolate absent an award so excessive . . . as to shock the judicial conscience and to raise an irresistible inference that passion, prejudice, corruption or other improper cause invaded the trial.’ [Hill v. J.B. Hunt Transport, Inc., 815 F.3d 651, 668 (10th Cir. 2016)] (citation and internal quotation marks omitted).  See also Slevin v. Board of Commissioners for County of Doña Ana, 934 F.Supp.2d 1270, 1275 (D.N.M. 2012) (‘[W]here the jury has fixed an award to compensate a plaintiff for pain and suffering, the court is permitted to grant a new trial or remit the judgment ‘only rarely and in extraordinary circumstances.’) (citation omitted).”

At a time when judges too often usurp the role of a jury both before and after trial, Judge Blackburn’s observations about well-established precedent requiring deference to jury verdicts are an important reminder about the respective role of the judge and jury.

Whistleblower Protections for Employees of Department of Defense Contractors

Whistleblower Retaliation

Remedies in Whistleblower Retaliation Cases

Defense Contractor Whistleblower Protection Act