Austin v. Healthtrust, Inc.-The Hospital Co.
41 Tex. Sup. Ct. J. 679, 967 S.W.2d 400, 13 I.E.R. Cas. (BNA) 1707 (1998)
Premium Feature
Subscribe to Lexplug to listen to the Case Podcast.
Rule of Law:
The Supreme Court of Texas will not create a new common-law cause of action for retaliatory discharge of private-sector whistleblowers where the Legislature has extensively and specifically addressed whistleblower protections in various statutes, often rejecting broad, general whistleblower laws.
Facts:
- Lynda Gail Austin worked as an emergency room nurse at Gulf Coast Medical Hospital for approximately fifteen years.
- In July 1992, Austin observed a fellow emergency room nurse, Clay Adam, appearing to be under the influence of drugs.
- Austin subsequently learned that Adam had been distributing prescription medication to patients without proper physician authorization.
- Austin reported this information to her supervisor, Patrick Lilley, and also submitted a written report detailing Adam's conduct.
- Lilley instructed Austin to keep the information confidential.
- On December 1, 1992, Lilley fired Austin and asked her to leave the premises.
- Austin later discovered that Lilley was a family friend of Clay Adam.
Procedural Posture:
- Lynda Gail Austin brought suit against HealthTrust Inc. — The Hospital Company, the Gulf Coast Medical Foundation d/b/a Gulf Coast Medical Center, and Patrick Lilley in a trial court.
- HealthTrust moved for summary judgment, asserting that Austin failed to state a cognizable claim under Texas law.
- The trial court granted HealthTrust's motion for summary judgment.
- Austin appealed the trial court's decision to the court of appeals.
- The court of appeals affirmed the trial court's judgment, holding that Texas does not recognize a common-law cause of action for retaliatory discharge of a private employee who reports illegal activities in the workplace.
Premium Content
Subscribe to Lexplug to view the complete brief
You're viewing a preview with Rule of Law, Facts, and Procedural Posture
Issue:
Does the Supreme Court of Texas recognize a common-law cause of action for a private-sector employee who alleges retaliatory discharge for reporting illegal or unethical activities within the workplace?
Opinions:
Majority - Owen, Justice
No, the Supreme Court of Texas declines to create a common-law cause of action for private whistleblowers. The Court reaffirmed its previous stance in Winters v. Houston Chronicle Publishing Co., where it declined to further modify the employment-at-will doctrine to include such a cause of action, noting the Legislature's activity in this area. The Court observed that since Winters, several courts of appeals have similarly refused to recognize a private whistleblower cause of action. The Court emphasized that the Legislature has been highly proactive in enacting numerous specific statutes that protect various classes of employees from retaliation for whistleblowing, including registered nurses like Austin (under Article 4525a) and general hospital employees (under Health and Safety Code § 161.134, though not in effect at the time of Austin's discharge). Furthermore, the Legislature explicitly rejected a proposed general 'Whistleblower Act' for all private employees in 1995. The Court concluded that creating a broad common-law cause of action would largely 'eviscerate' or 'emasculate' these existing, narrowly-crafted statutory schemes, which include diverse protections, remedies (some with exemplary damages, others limited to lost wages), and varying procedural requirements (different statutes of limitations, some requiring exhaustion of administrative remedies). The Court stated that crafting such remedies, which involve balancing competing interests and policies, is a task better suited for the Legislature.
Concurring - Gonzalez, Justice
No, the Supreme Court of Texas declines to create a common-law cause of action for private whistleblowers based on the specific facts presented, but this does not preclude the Court from doing so in a future, more compelling situation. Justice Gonzalez concurred in the judgment but expressed concern that the majority's opinion might signal a retreat from the Court's established power to amend the judicially created employment-at-will doctrine, as it did in Sabine Pilot Serv., Inc. v. Hauck. The concurrence noted that in Winters, the Court only declined to modify the doctrine 'at this time on these facts,' implying future flexibility. Justice Gonzalez agreed that Austin's case did not present a sufficiently 'compelling scenario of injustice' to warrant modifying the doctrine, especially because Austin, as a registered nurse, had an existing statutory remedy under Article 4525a, which required her to report nurse misconduct to the Board of Nurse Examiners and provided a civil cause of action for retaliation if she had pursued it. The concurrence reiterated that the Court has a 'burden and the duty of amending [the doctrine] to reflect social and economic changes' when a truly compelling situation arises.
Analysis:
This case significantly reinforces the principle of judicial restraint and deference to the legislative branch in Texas employment law, particularly concerning the employment-at-will doctrine. It sets a high bar for the judiciary to create common-law exceptions when the Legislature has already acted extensively in the area, even if those actions are specific rather than comprehensive. The ruling suggests that in Texas, employees seeking whistleblower protection must primarily rely on statutory remedies, and courts will be hesitant to create broader protections unless a statutory gap is glaring and the legislative intent is unclear or absent.
