In Erhart v. BofI Holding, Inc., Case No. 15-cv-02287, (S.D. Cal. Feb. 14, 2017), a bank’s internal auditor reported alleged misconduct to federal agencies, engaged in self-help discovery by appropriating the bank’s confidential information, and allegedly widely disseminated such information. When the bank alleged that this conduct violated the parties’ confidentiality agreement and state and federal law, the employee countered that his appropriation and disclosures were protected by whistleblower statutes. As discussed below, the court held that: (i) the employee’s disclosures to the government were protected; (ii) his alleged disclosures to the media were not; and (iii) any additional protection of his appropriation and disclosure of confidential information may turn on whether his actions were reasonably necessary to pursue whistleblower claims.
A former employee of the upscale outdoor furniture designer and manufacturer Brown Jordan recently failed in his bid to pursue whistleblower retaliation claims against the company and also found himself liable for snooping on his boss’s (and other’s) emails. A three-judge panel of the Eleventh Circuit recently affirmed the District Court’s summary judgment for the employer on the former employee’s purported whistleblower claim, concluding that his report of alleged “misconduct” by his employer’s senior management was not actionable. In their unanimous decision, the judges also affirmed the District Court’s judgment in favor of the employer under the Stored Communications Act (SCA) and Computer Fraud and Abuse Act (CFAA) due to the employee’s spying on the emails of his superiors, colleagues, and subordinates without authorization over a period of months. While both the former employee and former employer traded accusations of wrongdoing during the course of the litigation, after summary judgment, trial and appeal, it is only Carmicle, the former employee, who has been found by the district court and the circuit to have done anything improper. Carmicle v. Brown Jordan Int’l, Inc., et al., No. 16-11350 (11th Cir. Jan. 25, 2017)
A California Magistrate Judge in BofI Federal Bank v. Erhart ruled that a whistleblower’s attorney’s communications sent to federal regulators were protected by the attorney work product doctrine. No. 15-cv-2353 (S.D. Cal. Aug. 5, 2016). The court concluded that the whistleblower’s attorney had not waived work product protection through her disclosure to third-party regulators, finding that she and the regulators shared a common interest.
In Cardenas v. M. Fanaian, D.D.S., Inc., Case No. F069305 (Cal. App. 5 Dist.), a California Court of Appeal determined that Plaintiff Cardenas could pursue a California Labor Code Section 1102.5 retaliation claim against her former employer, M. Fanaian, D.D.S., Inc. (“Company”) based on her allegation that it discharged her because she reported her coworker’s alleged theft of her property to law enforcement authorities—a complaint that did not implicate any wrongdoing by the Company itself.
Arguing that relators’ counsel has retained and used, without authority, more than 800 of its attorney-client privileged and work product documents, Kinetic Concepts, Inc. (“KCI”) has asked the District Court for the Central District of California to disqualify opposing counsel in United States ex rel., Steven J. Hartpence v. Kinetic Concepts, Inc., Case No. 08-01885 (C.D. Cal. Apr. 8, 2013).
Two relators, Geraldine Godecke and Steven Hartpence, have brought qui tam actions against KCI alleging that it submitted false claims to Medicare for KCI’s wound care treatment devices in violation of the federal False Claims Act (“FCA”). Both relators, who held senior-level positions with KCI, routinely interacted with in-house and outside counsel concerning the company’s legal advice, strategy and tactics. Before she was terminated, Relator Godecke spent the better part of a week downloading hundreds of communications with in-house and outside counsel with the intention of removing them before she was terminated.