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Fourth Circuit Affirms District Court’s Dismissal of Intrusion upon Seclusion and Fraud Action Where Plaintiffs Could Not Establish That Breath Testing was Highly Offensive

Wendell Whye v. Concentra Health Services, Inc.
Case No. 13-2302 (Sept. 10, 2014)
by Jhanelle A. Graham, Associate
Semmes, Bowen & Semmes (www.semmes.com)

Available at: http://www.ca4.uscourts.gov/Opinions/Unpublished/132302.U.pdf

In Wendell Whye v. Concentra Health Services, Inc., the United States Court of Appeals for the Fourth Circuit was asked to determine whether the district court erred in granting the motion to dismiss of Concentra Health Services, Inc. (“Concentra”) for failure to state a claim. Wendell Whye and William Trout (“Plaintiffs”), individually and on behalf of a class of similarly situated individuals, filed a putative class action lawsuit in Maryland circuit court against Concentra Health Services, Inc. (“Concentra”), asserting Maryland tort claims for intrusion upon seclusion and fraud based on allegedly unlawful breath alcohol testing that Concentra conducted on Plaintiffs and other class members. After Concentra removed the case to federal district court on the basis of diversity jurisdiction, the district court granted Concentra’s motion to dismiss the complaint for failure to state a claim. In a per curiam opinion, the Fourth Circuit affirmed the lower court’s decision.

Plaintiffs, individually and on behalf of a class of persons similarly situated, filed a putative class action law suit against Concentra, alleging that Concentra violated “Maryland law by conducting unlawful job-related breath alcohol tests.” In particular, Plaintiffs alleged that by conducting breath alcohol tests on the employees and job applicants of public and private Maryland employers, Concentra violated Md. Code (2009 Repl. Vol., 2012 Supp.), § 17-214 of the Health-General Article (“H.G.”) (the “Testing Statute”), which regulates the testing of alcohol and controlled dangerous substances by Maryland employers. Recognizing that the Testing Statute did not provide a private right of action, Plaintiffs lodged common law claims under Maryland law for the tort of intrusion upon seclusion (Count I) and fraud (Count II), seeking both compensatory and punitive damages.

In Count I of the complaint, Plaintiffs alleged that “Concentra intentionally invaded [plaintiffs’] privacy by physically intruding upon their right to seclusion and their right to be free of intrusion into private bodily functions,” by “subjecting [plaintiffs] to unlawful job-related breath alcohol testing.” They also complained that Concentra acted “deliberately, with actual malice, and with the intention of depriving [plaintiffs] of their rights . . . and/or with reckless disregard for those rights.”. Count II alleged that Concentra “made numerous false representations of material facts” to Plaintiffs, by “[a]dulterating and using a federally-prescribed form” for breath testing and by giving Plaintiffs “the false impression that the illegal breath alcohol testing procedures . . . had the approval of the federal government, and/or were under the auspices of some required federal testing program.”

After reviewing the facts of the case and the legislative history of the relevant statute, the Maryland federal district court found that (1) prohibition on the use of breath testing by private employers is consistent with the purpose of the Testing Statute; (2) Plaintiffs failed to state a claim because the breath tests did not intrude upon plaintiffs’ reasonable expectation of privacy, in that “employees do not have a right to be free from intrusion of bodily functions under [H.G.] § 17-214,” nor do they have “a reasonable expectation of privacy in [their] blood alcohol content, regardless of how it is measured”; and, (3) even if plaintiffs had such an expectation, the intrusion occasioned by the tests was not highly offensive to a reasonable person. For these reasons, and because Plaintiffs did not suffer damages as a result of submitting to the breath tests, the Maryland district court granted Concentra’s motion to dismiss the Complaint for failure to state a claim upon which relief could be granted.

On appeal, the Fourth Circuit began its review by stating that, under Maryland law, the tort of intrusion on seclusion is “[t]he intentional intrusion upon the solitude or seclusion of another or his private affairs or concerns that would be highly offensive to a reasonable person.” Mitchell v. Balt. Sun Co., 883 A.2d 1008, 1022 (Md. Ct. Spec. App. 2005) (internal quotation marks omitted); see RESTATEMENT OF TORTS 2d, § 652B (1977). Further, “the gist of the offense is the intrusion into a private place or the invasion of a private seclusion that the plaintiff has thrown about his person or affairs.” Pemberton v. Bethlehem Steel Corp., 502 A.2d 1101, 1116 (Md. Ct. Spec. App. 1986). An actionable tort requires both that “the intrusion must be something which would be offensive or objectionable to a reasonable man,” and that “the thing into which there is intrusion or prying must be, and be entitled to be, private.” Hollander v. Lubow, 351 A.2d 421, 426 (Md. 1976) (internal quotation marks omitted) (relying on W. Prosser, THE LAW OF TORTS 807-08 (4th ed. 1971)), superseded on other grounds as stated in Hartford Ins. Co. v. Manor Inn of Bethesda, Inc., 642 A.2d 219 (Md. 1994). Plaintiffs’ assertion that the district court erred in dismissing their intrusion upon seclusion claim was, therefore, not viable, because they could neither establish a reasonable expectation of privacy in their breath, nor that the breath testing was highly offensive to a reasonable person. Importantly, the Court stated that even accepting, without deciding, Plaintiffs’ argument that they had a reasonable expectation of privacy in their breath, Plaintiffs could not establish that the breath testing was highly offensive to a reasonable person as a matter of law.

Turning to the fraud claim, the Fourth Circuit reiterated that a plaintiff must plead the circumstances constituting fraud with particularity. See Fed. R. Civ. P. 9(b). To establish a claim for fraudulent misrepresentation, the plaintiff must demonstrate that (1) “the defendant made a false representation to the plaintiff,” (2) the defendant knew the misrepresentation was false, or made the misrepresentation with reckless indifference to its truth or falsity, (3) the defendant made the misrepresentation “for the purpose of defrauding the plaintiff,” (4) the plaintiff relied, and had a right to rely, on the misrepresentation, and (5) the plaintiff suffered compensable damages resulting from the misrepresentation. Hoffman v. Stamper, 867 A.2d 276, 292 (Md. 2005). A “false representation” is defined as “a statement, conduct, or action that intentionally misrepresents a material fact.” Sass v. Andrew, 832 A.2d 247, 260 (Md. Ct. Spec. App. 2003); see also Fowler v. Benton, 185 A.2d 344, 349 (Md. 1962) (defining false representation as “anything short of a warranty which produces upon the mind a false impression conducive to action”). A fact is material if a reasonable person would rely upon it in making a decision or if the maker knows the specific recipient of the fact would likely consider it important. Gross v. Sussex, Inc., 630 A.2d 1156, 1161 (Md. 1993).

The Court agreed with the district court’s conclusion that Plaintiffs failed to adequately plead any of the four (4) elements of fraud, and held that Plaintiffs’ arguments were unpersuasive in light of the district court’s thorough treatment of the issue. Moreover, even assuming, without deciding, that the district court incorrectly determined that Plaintiffs failed to adequately plead scienter, the appellate court concluded that Plaintiffs failed to adequately allege the remaining elements of fraud. Therefore, the district court did not reversibly err in dismissing this claim.