RYAN J. FOLEY
---- — IOWA CITY — A former Iowa State University employee was the victim of a long and vicious harassment campaign by superiors, but he failed to prove that their actions came in response to his exposing his boss’ financial misconduct, a court ruled Wednesday.
The Iowa Court of Appeals rejected a jury’s finding that former ISU College of Engineering marketing employee Dennis Smith was the victim of whistleblower retaliation, throwing out a landmark $784,000 award in his favor.
But the court said Iowa State did intentionally inflict emotional distress on Smith through the actions of his superiors, which included false accusations to campus police that Smith was a security threat and potential mass murderer, and attempts to force him out. The court upheld the jury’s $500,000 award for Smith on that claim.
Smith, 60, said he disagreed with the court’s reading of Iowa’s whistleblower statute, saying it was so narrow that it would offer little protection to employees who report wrongdoing. He pledged to ask the Iowa Supreme Court to review that issue.
“It is open season on whistleblowers if this ruling stands,” he said.
ISU’s general counsel, Paul Tanaka, said the school was grateful that the whistleblower claim was vacated, but troubled that the other was upheld.
“We don’t believe it’s factually or legally sound,” he said, adding the school will consult with the Iowa Attorney General’s Office in determining whether to appeal.
A key issue Wednesday was whether Smith’s employers retaliated against him for his 2007 report of financial misconduct by his supervisor, Pamela Reinig, to then-ISU President Greg Geoffroy. Smith’s report prompted Geoffroy to order an audit that found Reinig had kept $58,000 from an outside organization for work done by the college, instead of depositing payments in an ISU account. Reinig resigned and was criminally prosecuted.
Writing for a unanimous three-member panel, Chief Judge Larry Eisenhauer said Smith’s report was protected under Iowa’s whistleblower law, which says state employees cannot face adverse actions for telling a public official about legal or policy violations or mismanagement. However, he said Smith failed to prove that the retaliation and harassment he endured was “a reprisal for” his disclosure, noting that his mistreatment had already started by then.
Eisenhauer said there was “a continuous pattern of wrongful conduct” against Smith by Reinig; Eric Dieterle, a co-worker who became Smith’s boss after Reinig’s resignation; and then-Engineering Dean Mark Kushner.
Reinig called campus police nine times to claim that Smith was violent and a threat to others, saying he was capable of a Virginia Tech-style massacre. Dieterle also reported concerns about Smith, comparing him to an Omaha mall shooter. Kushner reported employees’ safety concerns about Smith to police. The reports resulted in a threat assessment on Smith.
The court noted that Reinig falsified Smith’s performance reviews, made false statements about Smith’s marriage and plotted with others about how to oust him. Kushner ignored an assistant dean’s suggestion to help Smith and instead backed Reinig, helping her try to get rid of him, Eisenhauer wrote. Kushner promoted Dieterle after Reinig’s resignation, and Dieterle damaged Smith’s reputation with clients and took duties away from him, he wrote.
Dieterle eventually eliminated Smith’s position in a reorganization, rewriting the job description with desired qualifications designed to exclude Smith, Eisenhauer wrote. He said “substantial evidence” supported the conclusion that ISU’s conduct was extreme and outrageous, the legal threshold to recover damages.
Jurors also did not err in determining that Smith suffered emotional distress, noting that he lost weight, began abusing alcohol, suffered insomnia and even considered harming himself, Eisenhauer wrote.
Smith said that he has been unable to find a job since his departure from Iowa State in 2010.
Kushner, who moved to the University of Michigan faculty in 2008, said he was never part of a conspiracy to “inflict any hardship” on Smith or force him out, but that it was his responsibility as an administrator to report safety concerns to police. He conceded that the poor relationship between Smith and Reinig, dating back years, “should have been mentored or counseled earlier.”
Dieterle, who is now at Northern Arizona University, declined to comment. A message left for Reinig wasn’t returned.