Labor & Employment Law Daily Wrap Up, COVERAGE, LIABILITY—9th Cir.: Certified questions surrounding wrongful termination liability sent to Washington Supreme Court, (Sep 18, 2026)

By Todd Harrison, J.D.

At issue was whether Washington law recognizes common-law wrongful termination claims against indirect employers and/or individuals such as officers or superiors.

Certifying two questions to the Washington Supreme Court pertaining to wrongful termination liability, the Ninth Circuit found that only one published state appeals court case had considered the issue of indirect employer liability but left the question open, and that the issue raised important public policy considerations that should be resolved. On the matter of individual liability, the court noted that the Washington Supreme Court has not addressed the issue and the federal district courts are in disagreement about how the court would rule, thus requiring guidance from the state’s high court (Heimbigner v. Edgewater Services, LLC, No. 25-2325 (9th Cir. Sept. 17, 2026)).

This litigation arose from the termination of the CFO of Solgen Enterprises, a residential solar power sales and installation company. Defendant Edgewater is an investment advisory firm that acquired a 30 percent interest in Solgen. At that time, one of the individual defendants, Edgewater’s president, joined Solgen’s Board of Directors.

CFO search. Edgewater and its executives largely directed and facilitated the recruitment of the CFO. In September 2022, Edgewater directed Solgen to hire a new CFO using an executive search firm. The firm and Edgewater executives jointly selected the CFO for the position. The only parties to the employment agreement were the CFO and Solgen, but the agreement required the CFO to send any notices related to the agreement to both Solgen and Edgewater. The CFO negotiated his compensation package with Edgewater executives.

Termination. After the CFO raised concerns that Solgen was misleadingly inflating its reported revenue in violation of generally accepted accounting principles, he was fired. He then brought state-law claims for common-law wrongful termination in violation of public policy and intentional interference with contractual relations against Edgewater, Edgewater’s president, and Edgewater’s COO. The district court dismissed the action for lack of personal jurisdiction and for failure to state a claim, leading to this appeal.

Two questions. Having concluded that the district court erred in dismissing the action for lack of personal jurisdiction, the appellate court was tasked with deciding whether it should affirm the dismissal of the wrongful termination claim for failure to state a claim. The district court had dismissed the wrongful termination claim because it concluded that only a direct employer can be liable for wrongful termination, and it was undisputed that Solgen, not Edgewater, was the CFO’s direct employer.

On appeal, the CFO challenged this determination on two grounds. First, he contended that indirect employers can be liable for wrongful termination under Washington law, and thus he stated a claim against the defendants. Second, he argued that even if indirect employers cannot be liable for wrongful termination, he still stated a claim against the individual defendants because they acted as agents of his direct employer when they terminated him. In response, the defendants argued that indirect employer liability was unavailable, and even if the individual defendants acted as agents of Solgen, the claim against them should still be dismissed because individuals cannot be liable for wrongful termination under Washington law.

Given this backdrop, the court determined that it must resolve both certified questions to fully resolve this appeal. If an indirect employer can be liable for wrongful termination under Washington law, then the CFO stated a claim against Edgewater. If individuals can be liable for wrongful termination under Washington law, then the CFO has stated a wrongful termination claim against the individual defendants. However, if there is neither indirect employer liability nor individual liability for wrongful termination claims, then the CFO failed to state a claim and the district court correctly dismissed the claim with prejudice.

Awana. First, the court addressed the issue of indirect employer liability. The court noted that the Washington Supreme Court has never addressed the question and only one published Washington Court of Appeals case, Awana v. Port of Seattle, 89 P.3d 291 (Wash. Ct. App. 2004), considered the issue but left the question open.

In Awana, asbestos abatement workers alleged their direct employer, Alpha, a government contractor with the Port of Seattle, terminated their employment after they complained of safety issues at the Seattle airport. They brought wrongful termination claims against both Alpha and the Port. The superior court granted summary judgment in favor of the Port and the state appellate court affirmed, explaining that “[a]n action for wrongful discharge depends, by definition, upon termination of employment,” but that the plaintiffs “were not employees of the Port, and the Port did not terminate their employment.”

With regard to the plaintiffs’ arguments that a direct employment relationship is not required to establish liability, they first argued that the Port could still be liable because, as the owner and general contractor for the airport renovation, it had a duty to protect them from hazards, and that duty should include a duty to protect them from retaliation for reporting workplace hazards. The court rejected that argument because the Port’s control over the worksite did not confer control over the employment of its subcontractor’s employees.

In addition, the plaintiffs argued that the Port could be liable for wrongful termination because it exercised such great control over them that it was their “de facto employer.” The court also rejected this argument. However, in doing so, the court did not address whether a de facto employer could be liable for wrongful termination as a matter of law. Rather, it explained that the record showed the Port lacked any authority to intervene in the direct employer’s employee relations.

Opposing positions. Turning to the present case, both parties contend that Awana supports their respective positions. According to the CFO, Awana impliedly recognized that an indirect or “de facto” employer can be liable for wrongful termination and concluded only that the Port was not the employees’ de facto employer because it lacked control over their employment.

For their part, the defendants argued that Awana categorically held that indirect employers cannot be liable for wrongful termination, even if they are de facto employers. In their view, Awana “reject[ed] the plaintiffs’ ‘de facto’ theory because it was ‘based entirely upon cases distinguishing employees from independent contractors.’” Because the employees were not independent contractors, their “de facto” theory failed and the court’s discussion of whether the Port was their de facto employer amounted to dicta. They also argued that excluding indirect employers from liability for wrongful termination was consistent with the Awana court’s statement that the wrongful termination doctrine is a “narrow” exception to at-will employment.

Here, the appellate court determined that Awana expressly left open the question of whether an indirect, de facto employer can be liable for wrongful termination. Because the Awana court concluded that the Port did not control the employees’ employment, it did not reach the question presented here.

Policy. Recognizing that there was no controlling precedent, the parties both made policy arguments in favor of their respective positions. The CFO contended that the Washington Law Against Discrimination counsels adopting a broad definition of “employer” for the purpose of common-law wrongful termination claims. On the other hand, the defendants highlighted the Washington Supreme Court’s description of the tort of wrongful termination as a “narrow” exception to at-will employment.

“These arguments involve exactly the type of ‘important public policy ramifications’ with ‘broad application’ that the Washington Supreme Court should consider in the first instance,” said the court. Accordingly, it asked the state high court to decide whether indirect employers may be liable for common-law wrongful termination.

Individual liability. Next, the court considered the issue of individual liability. It noted that whether Washington law recognizes wrongful termination claims against individuals such as officers, managers, or supervisors was also an unsettled question of law. The Washington Supreme Court has not addressed the issue, and federal district courts disagree about how the court would rule.

Because it “it is necessary to ascertain the local law” of Washington “to dispose of [this] proceeding and the local law has not been clearly determined,” Wash. Rev. Code § 2.60.020, and because these issues involve important questions of public policy, the court here asked for guidance from the Washington Supreme Court, submitting the two certified questions and staying the proceedings until the state high court weighs in.

The case is No. 25-2325.

Judge: Per Curiam.

Attorneys: Jack N. Miller (Frank Freed Subit & Thomas) for Martin Heimbigner. Thomas H. Petridess (Vedder Price) for Edgewater Services, LLC and Matthew Snyder.

Companies: Edgewater Services, LLC

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