Supreme Court Holds Employee’s Use of Stolen Documents in Retaliation Claim May Be Protected Activity

Quinlan v. Curtiss-Wright Corp., No. A-51-09 (N.J. Sup. Ct., December 2, 2010) – The New Jersey Supreme Court recently announced the test for determining whether, and to what extent, an employee who copies and discloses an employer’s otherwise confidential documents for use in prosecuting a discrimination case against the employer has engaged in protected activity under the LAD. The plaintiff filed suit alleging gender discrimination and other claims after being passed over for a promotion. She then began to copy company documents, which she gave to her attorney to bolster her case. Her employer initially took no action, until it learned in the course of a deposition that she also was copying another employee’s personnel record. The plaintiff was then terminated, after which she added a retaliation claim. The court found that although the plaintiff’s conduct in taking the documents was unprotected (and she could have been terminated for that misconduct), the prosecution of her discrimination claim was protected activity, and she could not be terminated for bringing and prosecuting her suit. Since the jury found that she was terminated for bringing and prosecuting her suit (rather than taking the documents), the court affirmed the $11 million verdict.

In its opinion, the court adopted a new, seven-part inquiry to balance the employer’s legitimate right to conduct its business and safeguard its confidential documents with the employee’s right to be free from discrimination or retaliation. The factors to be analyzed include: 1) how the employee came into possession of, or obtained access to, the document; 2) what the employee did with the document; 3) the nature and content of the particular document in terms of the employer’s interest in keeping it confidential; 4) whether the employee’s disclosure violated a clearly identified company policy on privacy or confidentiality; 5) the circumstances relating to the document’s disclosure, balancing its relevance against whether its disclosure was unduly disruptive to the employer’s ordinary business; 6) the strength of the employee’s reason for copying the document rather than simply describing it or identifying its existence to counsel; and 7) consideration of the broad remedial purposes advanced by the discrimination laws and the effect, if any, that either protecting the document by precluding its use or permitting it to be used will have on the balance of legitimate rights of both employers and employees.