United States District Court, D. Colorado
For Gina Holub, Plaintiff: Robert Mark Liechty, Cross Liechty Lane, P.C., Greenwood Village, CO.
For Chris Gdowski, Shelly Becker, Adams 12 Five Star School District Defendants: Gillian Dale, Thomas John Lyons, Hall & Evans, LLC-Denver, Denver, CO.
MEMORANDUM OPINION AND ORDER
Richard P. Matsch, Senior United States District Judge.
Plaintiff Gina Holub is a former employee of Defendant Adams 12 Five Star School District (" the School District" or " the District" ) whose employment was terminated in October 2012. The individual Defendants are Chris Gdowski, superintendent of the School District; Shelly Becker, chief financial officer of the School District; Mark Hinson, the School District's assistant-superintendent of human resources; and Norm Jennings, a member of the School District's Board of Education (" School Board" or " Board" ). In her Second Amended Complaint, Holub brought the following claims against all Defendants except Norm Jennings: (1) First Amendment retaliation under 42 U.S.C. § 1983; (2) breach of contract; (3) intentional interference with a contractual relationship; and (4) wrongful discharge in violation of public policy. Holub also asserted a defamation claim against Superintendent Gdowski and Jennings. In her Response to Defendants' Motion for Summary Judgment, Holub agreed to dismiss Chief HR Officer Hinson and Norm Jennings from the case. [Doc. 57 at 2.]
The following facts are material and not in genuine dispute. The School District hired Gina Holub as its Internal Auditor and she began work in January of 2007. Holub's contract with the District provided that she could be terminated for " cause." [Doc. 55, Ex. B ¶ 9.] Holub's job duties required her to, inter alia :
Analyze data for internal audit. Determine the adequacy and effectiveness of the district's systems of internal accounting and operating controls. Review the reliability and integrity of financial information and the means used to identify, measure, classify and report such information.
. . .
Report to those members of management who should be informed or who should take corrective action, the results of audit examinations, the audit opinions formed, and the recommendations made.
. . .
Communicate results of internal audit to stakeholders.
[Doc. 55, Ex. C at 2.]
Holub reported to the School District's CFO. When Holub was hired, Becky Samborski was the District's CFO. During Ms. Samborski's tenure, the District had a recurring problem with underspending budgeted amounts in areas that could not be identified. [Doc. 55, Ex. D ¶ 2.] Samborski left the School District in October 2011.
Shelley Becker was hired as the District's new CFO in December of 2011. CFO Becker immediately identified a number
of issues with the District's prior budgeting practices, and within the first few months of her employment she began the process of converting the District to line-item budgeting to allow the District to more accurately compare budgeted funds to actual expenditures. One of the goals of this conversion was to identify the areas of underspending so future budgets would be more accurate. [Id. ¶ ¶ 3-4; Doc. 55, Ex. E ¶ 1.]
In mid-April 2012, CFO Becker asked Tracey Cantrell, the fiscal manager for the District's student support services department, to perform an analysis of the District's full-time equivalent employees (" FTEs" ). [Doc. 57, Ex. 1 ¶ 3.] Cantrell determined that there was at least $12 million in unverifiable FTE salary expenses built into the District's budget, which she reported to CFO Becker.
In June 2012, Gina Holub expressed concern to Superintendent Gdowski that reporting to CFO Becker was a conflict of interest, and stated that the Internal Auditor should instead report to the Superintendent. [Doc. 55, Ex. F at 72:13-18; 76:17-22.] Superintendent Gdowski asked Holub to research the proper reporting structure for an internal auditor and get back to him. [Id. at 72:19-24; 76:17-22.] Holub responded to Superintendent Gdowski by e-mail on July 12, 2012. She sent him the Attribute Standards from the Institute of Internal Auditors' website and quoted the following specific provisions:
1100 -- Independency & Objectivity
'To achieve the degree of Independence necessary to effectively carry out the responsibilities of the internal audit activity, the chief audit executive has direct and unrestricted access to senior management and the board. This can be achieved through a dual-reporting relationship.'
1110 -- Organizational Independence
'The chief audit executive must report to a level within the organization that allows the internal audit activity to fulfill its responsibilities. The chief audit executive must confirm to the board, at least annually, the organizational independence of the internal audit activity.' 'Organizational independence is effectively achieved when the chief audit executive reports functionally to the board.'
1111 -- Direct Interaction with the Board
'The chief audit executive must communicate and interact directly with the board.'
. . .
2060 -- Reporting to Senior Management and the Board
'The chief audit executive must report periodically to senior management and the board on the internal audit activities purpose, authority, responsibility, and performance relative to its plan. Reporting must also include significant risk exposures and control issues, including fraud risks, governance issues, and other matters needed or requested by senior management and the board.'
[Doc. 55, Ex. G (emphasis added).] Holub noted in her e-mail that the position of " chief audit executive" in the Attribute Standards appeared to match her job as the School District's Internal Auditor.
In June 2012, Holub analyzed the fiscal year 2012-2013 budget. Holub contacted Superintendent Gdowski and expressed her concerns that the budget contained $17 million in excess salary expenses and that improper " plugs" might have been used to balance the budget. [Doc. 34 ¶ 5; Doc. 55, Ex. D ¶ 6]. In response, Superintendent Gdowski encouraged CFO Becker to meet ...