The Texas Supreme Court dealt a painful blow to Texas employees in two decisions issued on February 22, 2013. The cases decided were The University of Texas Southwestern Medical Center at Dallas v. Gentilello and Texas A&M University – Kingsville v. Moreno. Both cases deal with Section 554.002 of the Whistleblower Act which, importantly, only covers employees of state or local governmental entities, not private employees.

In interpreting Section 554.002 of the Whistleblower Act, the court considered whether “an employee’s report to a supervisor is a report to an appropriate law enforcement authority…where the employee knows his supervisor’s power extends only to ensuring internal compliance with the law purportedly violated.” The court decided that while other states may protect purely internal whistleblowing, Texas does not.

What this means is that in Gentilello, the court dismissed the suit where a medical school faculty member made a complaint to another faculty member who was responsible for law compliance but not law enforcement. And in Moreno the court also dismissed the suit where the complaint was made to the University President. The suits were dismissed because neither one of the complaints were made to a “law enforcement authority” based on the Court’s interpretation of the statute. According to the Court only a report to “someone the employee ‘in good faith believes’ can ‘regulate under or enforce’ the law allegedly violated or ‘investigate or prosecute a violation of criminal law’” will suffice as a report under the statute.

As Michael Fox points out here, while the Court’s decision may seem like cause for celebration by officials at government agencies, the effect of the Court’s decision may actually be for whistleblowers to deal with their complaints about illegal activity outside of the agencies rather than having it dealt with internally. However, the full effect of the Court’s restricted view of the Whistleblower Act remains to be seen.