Employment Law Matters : Employment Lawyer & Attorney : Ogletree Deakins Law Firm : Labor Law, Human Resources

Recent court decisions related to employees’ online postings have centered on whether disciplinary decisions regarding those postings may violate the National Labor Relations Act (NLRA). The NLRA protects certain employee “concerted activities” aimed at discussing or improving working conditions, and precludes interference with such communications, including online messages. However, individuals also have brought other legal causes of action against employers for so-called “Facebook firings.” Recently, a Texas appeals court was asked to determine whether the firing of an employee on the basis of her Facebook comment violated that employee’s state law privacy rights. The court held that it did not. Roberts v. CareFlite, Texas Court of Appeal 2d District, No. 02-12-00105-cv, Oct. 4, 2012.

Janis Roberts was a paramedic with CareFlite, a helicopter/ambulance service. Roberts posted on a fellow employee’s Facebook wall that she “wanted to slap” a patient who had needed restraints during a transport. When CareFlite compliance officer learned of the posting, she sent a message to Roberts – also through Facebook – reminding her that the public sees such postings, and asking her to “consider removing that post.” In response, Roberts curtly stated “Yeah, whatever,” and went on to state that sometimes “a patient needs an attitude adjustment.” Roberts ultimately removed the original posting, but before she did, the company’s CEO was made aware of it.

Roberts was terminated for her post, and for her “unprofessional and insubordinate” response to the compliance officer. She subsequently filed a lawsuit asserting that the company’s reaction use of and reaction to her personal and private Facebook message postings invaded her privacy under two state law claims: public disclosure of private facts, and intrusion upon seclusion.

After the lower court dismissed both of Roberts’ claims, she appealed the intrusion upon seclusion claim. However, in order to establish such a claim, Roberts would have to show an intentional intrusion on her privacy that was “highly offensive to a reasonable person.” Roberts argued that the rights of employees to privately discuss issues of patients who might affect employees’ safety outweighed issues of public concern (in this case, the public’s confidence in the ambulance company) and that, therefore, the employer’s intrusion into that discussion was a violation of privacy. In essence, Roberts attempted to assert the state-law equivalent of an NLRA Section 8 claim, which precludes companies from interfering in employees’ work-related safety discussions. However, because Roberts’ invasion of privacy claim was brought under state law tort theory, the court found that argument to be irrelevant, and dismissed the lawsuit for lack of legal support.

While this case was brought under Texas state law, the rationale is applicable to other circumstances, as well: courts will not read an “appropriate” cause of action into a lawsuit that fails to assert it. Whether or not Roberts’ allegations would have supported a cause of action for violation of the NLRA, her failure to specifically allege that claim, and her reliance on the state-law invasion of privacy claim, doomed her lawsuit. Obviously, employers should not become complaisant based upon this decision – employees’ rights to communicate about the terms and conditions of their employment remain protected under federal law.
 

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Last month, employers received a little more help from the National Labor Relations Board (NLRB) in formulating social media policies that pass muster under scrutiny from the Board. On October 19, 2012, the Associate General Counsel (AGC) for the NLRB's Division of Advice provided a useful and well organized opinion in response to a request from an NLRB Regional Director. The request was for advice as to whether an employer’s social media policy violated the National Labor Relations Act (NLRA), and whether an employee’s termination because of a violation of that policy violated the Act. In that memorandum, the AGC concluded that the employer’s policy was not overly broad and did not violate the NLRA. He further concluded that the employer did not unlawfully discharge an employee for an electronic posting that violated the policy. In re: Cox Communications, Inc. Case 17-CA-087612 (October 19, 2012)

The situation arose when an individual, employed by Cox Communications, Inc. as a technical support representative, posted a comment to his “Google+” account, in response to a customer’s negative and very personal comment to him during a troubleshooting phone call. The posting included the “F-word” directed to the customer. A supervisor saw the posting and reported it to management. The employee was suspended and an investigation was undertaken during which it was discovered that the employee had engaged in other, similar postings that also included lewd language which disparaged customers. The employee ultimately was fired for his Google+ postings. In response, he filed a Charge with the NLRB, alleging that the company’s social media posting violated his rights under the NLRA.

An employer violates Section 8(a) of the NLRA if its policy would “reasonably tend to chill employees in the exercise of their Section 7 rights.” Section 7 of the Act allows employees to engage in protected concerted activity, in order to allow them to discuss terms and conditions related to employment. The NLRB has developed a two-step process to determine whether a policy might violate Section 8. First, it determines whether the policy violates the Act by directly restricting Section 7 protected activities. Second, if the policy does not explicitly restrict those activities, the Board reviews it to determine whether it still may violate the Act if an employee could “reasonably construe” the language as prohibiting protected activity; if the policy was promulgated in response to union activity; or if the policy has been applied to restrict such activity. While the Board will not find a violation simply because a policy can conceivably be read to restrict protected activity, it can (and typically will) find a violation if a policy contains no limiting language or context that would clarify to employees that their Section 7 rights are not restricted.

The Cox Communications social media policy included acceptable limiting language and context. Its restrictions were spelled out in detail: “DO NOT make comments or otherwise communicate about customers, coworkers, supervisors, the Company, or Cox vendors or suppliers in a manner that is vulgar, obscene, threatening, intimidating, harassing, libelous, or discriminatory on the basis of age race, religion, sex, sexual orientation, gender identity or expressions, genetic information, disability, national origin, ethnicity, citizenship, marital status, or any other legally recognized protected basis under federal, state or local laws, regulations or ordinance.” In addition, the policy included a “savings clause” that stated specifically that nothing in the policy “is designed to interfere with, restrain, or prevent employee communications regarding wages, hours, or other terms and conditions of employment.”

In his analysis, the AGC pointed to the detailed policy provisions as providing context regarding the “reasonableness” of the policy. Whereas a rule simply proscribing “negative conversations” about manager, with no further clarifications or examples, would be unlawful because of a potential chilling effect on protected activity, Cox’s policy provided a lost list of “plainly egregious conduct,” and “clearly would not be reasonably understood to restrict Section 7 activity.”

The AGC also pointed out the policy’s “savings clause . . . further ensures that employees would not reasonably interpret any potentially ambiguous provision in a way that would restrict Section 7 activity.” Based on the wording of the policy, the Board concluded that the termination of the technical support representative was lawful, because the Google+ post was not concerted activity for mutual aid and protection within the meaning of Section 7 of the NLRA. Concerted activity is defined to include “circumstances where individual employees seek to initiate or to induce or to prepare for group action.” Clearly, the employee’s vulgar comments directed at a customer in anger, and not on behalf of coworkers or others, and could not be construed as concerted activity. Further, the company’s investigation of the matter before firing the individual evidenced a considered and thorough review of the situation.

Takes-aways from this matter are clear: (1) social media policies should include limiting language or other context that would clarify to employees that Section 7 rights are not restricted; (2) a “savings clause” that specifically states that the policy is not meant to prevent concerted communications can support a Board finding that the policy is lawful; and (3) a practice of prompt and thorough investigation of an employee’s posting, including objective and thorough documentation, prior to taking adverse action against the employee will help to support the appropriateness of the action.
 

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On September 28, 2012, a three-member panel of the National Labor Relations Board (NLRB) affirmed the decision of an Administrative Law Judge (ALJ) who upheld a car dealership’s firing of a salesperson that was based on a Facebook posting. But it also found a way to include its Notice of Employee Rights poster in the resolution of the case. Karl Knauz Motors, Inc. Case 13-CA-036452 (Sept. 28, 2012).

In May of 2011, NLRB issued a complaint (and accompanying press release) alleging unlawful termination of the car salesman for posting photos and comments on Facebook.  The complaint, which was similar to other complaints filed by the NLRB in the months prior to that case, alleged that a Chicago area BMW dealership illegally fired the employee after that individual posted information on his Facebook page that arguably was critical of the dealership.

In that case, the BMW dealership’s salesperson was unhappy with the quality of food and beverages at a dealership event promoting a new BMW model. At the time, a Huffington Post reporter summarized the issue this way: “[The salesman] and a few co-workers apparently felt that Sam's Club hot dogs and bottled water were no way to hype a luxury car -- and they thought their sales might suffer because of it. The salesman's critical commentary [on his own Facebook page] included photographic evidence of the unremarkable snacks.”  Other employees had access to that Facebook page. When the dealership’s management asked the salesman to remove the posts, he immediately complied. Nevertheless, shortly after a subsequent meeting with his managers, the employee was terminated.

However, the employer/dealership stated that in reality, the salesman was fired because he also posted photos of an embarrassing (and potentially dangerous) accident involving a salesperson and vehicle from a neighboring car dealership, also owned by his employer. That situation involved a saleswoman who imprudently had allowed the 13 year old son of a customer to sit behind the wheel of a luxury SUV that had been purchased by the young person’s father. Apparently, the young man threw the car into gear and hit the gas, running over his father’s foot and jumping a wall, landing in a pond and damaging the vehicle.

The matter was heard by an Administrative Law Judge, who determined that the Facebook posting related to the snack issue was protected concerted activity that discussed “terms and conditions” of employment. Under the NLRA, employee communications about work-related issues are entitled to protection, and employers are prohibited from stifling that activity. However, the ALJ went further and determined that the employee actually was fired for his second posting, in which he mocked a dangerous situation and embarrassed others – and neither activity is protected by the NLRA. Therefore, the ALJ upheld the firing. That decision now has been affirmed by the NLRB.

In this era of increased focus on employer limitations on electronic communications, however, the dealership hasn’t gotten away unscathed. Two of the three members of the NLRB panel that heard the case found that the employer’s “Courtesy” policy -- which stated that “Everyone is expected to be courteous, polite and friendly to our customers, vendors and suppliers, as well as to their fellow employees. No one should be disrespectful or use profanity or any other language which injures the image or reputation of the Dealership.” – violated the NLRA because the rule might “chill” employees’ protected statements related to working conditions, or in seeking the support of others to improve those conditions.

As a penalty for that violation, the Board has required the dealership to rescind the offending policies and to notify employees of that rescission. The notification is to be done by posting a specific form provided by the NLRB and entitled “Notice to Employees.” That notice specifically informs employees of their right to “form, join, or assist a union.” Worth noting is the fact that this mandated Notice contains wording similar to the “Employee Rights Notice” set forth in a proposed NLRB rule that has been the subject of legal challenges since December of 2010. While those legal challenges have kept the rule from being implemented, the NLRB has taken every opportunity to include the posting as part of any penalty imposed on employers who are found to have violated the NLRA by restricting protected communications among employees. To avoid that scenario, employers should take the opportunity to review their social media policies, and to train managers and supervisors to coordinate with their human resources departments any planned disciplinary actions based upon the use of electronic communications, especially if those communications involve personal postings.
 

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Section 7 of the National Labor Relations Act (NLRA) protects the right of employees to engage in “concerted activities” with each other for the purpose of collective bargaining or in efforts to improve working conditions and terms of employment. These concerted activities can be done in person, or by other methods of communication, including electronic media. Employers who terminate an employee based upon a social media posting that ultimately is determined to have been “protected concerted activity” may be violating Section 7 of the NLRA. An employer’s discipline or termination of an employee, if found to violate the NLRA, can lead to legal liability that may result in financial damages and reinstatement of the employee. That fact has created interest, consternation, and varying levels of panic among employers who are trying to balance the rights of employees to protected concerted activity with a company’s right to expect compliance with its policies and with attempts to protect confidential information.

In August 2011 and January 2012, the Acting General Counsel of the National Labor Relations Board (NLRB) issued reports that both dealt with cases arising in the context of employee communications via social media. Those reports provided to employers a glimpse into the NLRB’s rationale for dealing with cases in which employees claim that an employer’s disciplinary action based on a social media posting violated Section 7 of the NLRA. But those reports did little to stem employers’ concerns related to the delicate balance between employees’ rights to open communication with each other, and implementation and enforcement of company policies related to communications via social media.

On May 30, 2012, the NLRB issued its third report. This one was dedicated primarily to social media policies. The report summarized seven different policies, pointing out provisions in the first six which may be in violation of Section 7 of the NLRA, but holding up the seventh policy – newly revised by a national retail chain -- as “lawful.”

Some of the examples of “unlawful” language in the first six policies may cause some concern among employers. For instance, one company’s policy stating that employees who were in doubt as to whether a posting might violate the policy should “check with [Employer] Communications or [Employer] Legal to see if it’s a good idea . . . .” was deemed a violation of law because a “rule that requires employees to secure permission from an employer as a precondition to engaging in Section 7 activities” automatically violates the NLRA. A company’s policy that required employees to assure that “posts are completely accurate and not misleading and that they do not reveal non-public company information on any public site” was deemed to be unlawfully overbroad and, according to the NLRB, could “reasonably be interpreted to apply to discussions about, or criticism of the Employer’s labor policies and its treatment of employees that would be protected by the [NLRA]. . . .” Of real concern is the NLRB’s evaluation of this company policy: “Offensive, demeaning abusive or inappropriate remarks are as out of place online as they are offline.” According to the Board, that statement is in violation of Section 7 because it “proscribes a broad spectrum of communications that would include protected criticisms of the Employer’s labor policies or treatment of employees.”

Employers should disabuse themselves of the notion that a “savings clause” (for example, “This policy will be administered in compliance with applicable laws and regulation, including Section 7 of the NLRA.”) will satisfy the NLRB from finding its policy to be unlawful. Such a provision, according to the May 30 report, “does not cure the ambiguities in [a] policy’s overbroad rules.”

What can an employer do to meet the standards set forth by the NLRB in this latest report? Luckily, the Board provided a roadmap in the form of an “acceptable” policy. According to the Board, the key to that policy’s lawfulness is that the policy “provides sufficient examples of prohibited conduct so that, in context, employees would not reasonably read the rule to prohibit Section 7 activity.” While a number of the policy’s provisions are as broad as those found by the NLRB to be in violation of Section 7 in other policies, the concrete examples of what does and does not violate the policy seems to have satisfied the concerns that the Board expressed regarding the six earlier examples.

While some employers may assume that the easiest way to assure full compliance with Section 7 is simply to use the exemplar policy in its totality, those employers should understand that company policies typically are not one-size-fits-all. A more practical solution would be to review the exemplar policy carefully, and then tailor its core concepts to fit the values and existing needs of the specific employer. It also is important to continue to pay attention to the development of case law in this area, to assure an understanding of how the courts will interpret this latest NLRB report.
 

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Recently, the National Labor Relations Board (NLRB) has increased its focus on social media communications, and especially on those postings that include discussion regarding the terms and conditions of employment. The issues most commonly raised in cases before the NLRB have alleged that: (1) an employer has overbroad policies that restrict employees’ use of social media; or (2) that an employer unlawfully discharged or disciplined one or more employees over contents of social media postings. Based upon the Board’s increased focus on these issues, employers are reviewing and revising existing social media policies in an attempt to fully understand how this area of the law is evolving.

While there has been a rash of cases in which employers have been criticized for restrictions related to employees’ social media use, three recent memoranda to NLRB regional offices from the Board’s Office of the General Counsel (OGC) indicate that the Board is not imposing a blanket prohibition on discipline related to social media postings by employees.

On July 7, 2011, the OGC responded to a query as to whether an employer unlawfully discharged an employee/bartender for posting a Facebook message that referenced the employer’s tipping policy (that waitresses do not share tips with bartenders), which was posted in response to a non-employee/relative’s question regarding how his night at work went. JT’s Porch Saloon & Eatery Ltd., NLRB Div. of Advice, No. 13-CA-46689, 7/7/11. The employee’s response complained that he hadn’t had a raise in five years, and that he was doing waitresses work without tips. He also called his customers “rednecks” and stated that he hoped they “choke on glass” as they drive home drunk. The postings were not discussed with other employees, either before or after the posting. The OGC opined that there was no evidence of the “concerted activity” protected by Section 8(a)(1) of the National Labor Relations Act (NLRA) and that, therefore, the firing of that individual because of his postings did not violate the NLRA.

Less than two weeks later, on July 19, 2011, the OGC responded to a request for advice regarding whether an employer unlawfully discharged an employee for inappropriate Facebook postings that referenced the employer’s mentally disabled clients. Martin House, NLRB Div. of Advice, No. 34-CA-12950, 7/19/11. In that instance, an employee of a non-profit residential facility for homeless people with significant mental health issues engaged in a Facebook “conversation” with a non-employee/friend in which she referenced a client’s “voices” and told her friend it was “spooky” to work in a “mental institution” at night. One of the employer’s former clients saw the postings and called to report her concern, and the employee was fired. The employer based its action on the premise that it is not “recovery oriented” to use the clients’ illnesses for personal amusement. The OGC pointed out that the employee was not seeking to induce to prepare for group action related to her job conditions. Instead, the postings were communications with non-employees/friends about what was happening on her shift. The OCG found that the employee was not fired in violation of the NLRA.

Also on July 19, 2011, the OGC responded to question as to whether a retail employer violated Section 8(a)(1) by disciplining an employee for posting profane comments, critical of local management, on his personal Facebook page.  In that circumstance, a customer service employee in Oklahoma posted comments to his Facebook page after interacting with a new Assistant Manager. The comments were read and responded to by co-workers. However, the responses consisted largely of “hang in there” type remarks, and did not reference terms and conditions of the work environment. The OGC determined that the company’s discharge of the individual was not a violation of the NLRA, because the postings were made “solely by and on behalf of the employee himself” and did not look seek to initiate or induce group action. According to the OGC “mere griping” is not protected activity.

These recent advisory letters indicate that the NLRB’s review of social media cases is developing further, but there still are no clear-cut directives on which employers can rely for advice. However, some newly developed resources are available. Earlier this year, the U.S. Chamber of Commerce submitted a Freedom of Information Act (FOIA) request to the NLRB, seeking “copies of all charges, complaints, and completed settlements related to social media.” In response, the Chamber received information going back to 2009 which included 117 charges, 7 complaints, and 5 settlement agreements, and compiled that information into a survey that is available for review. According to the Chamber, the purpose of this survey is to “summarize the publicly available information obtained through our FOIA request and other available sources regarding the NLRB’s caseload related to social media in an effort to help reveal the many areas where social media and labor law intersect—areas that will confront the Board, employers, and other stakeholders in the coming months and years.” Compiled by Michael J. Eastman, Executive Director, Labor Law Policy, U.S. Chamber of Commerce, this compilation is a “must-read” resource for employers. See Michael’s comments on the Chamber’s blog.
 

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[With thanks to Hera Arsen, J.D., Ph.D., in our Client Services group - her more detailed explanation of this case can be found on the firm's website at www.ogletreedeakins.com.]

The U.S. Supreme Court has held that a city police department's search of an employee/police officer’s text messages was reasonable, and did not violate the individual’s Fourth Amendment (“search and seizure”) rights. City of Ontario v. Quon, No. 08-1332, U.S. Supreme Court (June 17, 2010). While employers have been anticipating the high court’s opinion on whether employees have a reasonable expectation of privacy related to electronic messages, the Supreme Court did not tackle that issue. Instead, the Court assumed that the officer did have a reasonable expectation of privacy in his personal text messages. However, the Court also found that the search was motivated by a legitimate work-related purpose, and was not excessive in scope. Based upon those factors, the Court held that the city's review of the officer's text messages was reasonable and did not violate the employee’s Constitutional Rights. City of Ontario v. Quon, No. 08-1332, U.S. Supreme Court (June 17, 2010).

Jeff Quon was a police sergeant with the Ontario Police Department (OPD). In 2001, the city of Ontario acquired 20 alphanumeric pagers capable of sending and receiving text messages and contracted with an outside vendor to provide wireless services. Under the agreement with the city, the vendor charged an overage fee if messages exceeded 25,000 characters in a single month.

Before acquiring the pagers, the city adopted a “Computer Usage, Internet and E-mail Policy,” which was applicable to all employees. The policy set forth that the city “reserves the right to monitor and log all network activity including e-mail and Internet use, with or without notice.” The policy further stated that “users should have no expectation of privacy or confidentiality when using these resources” and that the use of inappropriate language in the e-mail system would not be tolerated. Although the policy did not specifically refer to text messaging, the city issued a written memo to employees that it would treat text messages the same way as it treated e-mails, and that text messages would be “eligible for auditing.” Quon signed a statement acknowledging that he had read and understood the city’s policy.

After Quon began to regularly exceed the 25,000-character limit, he was reminded that text messages were “considered e-mail and could be audited.” In October 2002, in an attempt to determine whether the 25,000 character limit was too low for work-related messages, the police department asked its vendor to provide the transcripts of Quon’s last two months of messages to determine if the overages were for work-related or personal messages. The transcripts revealed that many of the messages were personal in nature and that some were sexually explicit. That triggered an investigation of whether Quon was violating Ontario Police Department (OPD) rules by pursuing personal matters while on-duty. It was determined that in August, Quon sent or received 456 messages during work hours, and that less than 60 of those were work-related. The report concluded that Quon had violated OPD rules, for which he could be disciplined.

Quon filed suit in the U.S. District Court for the Central District of California claiming, in part, violation of his Fourth Amendment rights, and arguing that the privacy of personal text messages is protected by the ban on “unreasonable searches and seizures” found in the Fourth Amendment to the U.S. Constitution. The trial judge agreed that Quon had a reasonable expectation of privacy in the text messages, but held a jury trial to determine the intent of OPD’s search. The jury determined that the original purpose of investigation of the text messages was to determine the efficacy of the character limit, and not to determine whether Quon was wasting time while on-duty. Thus, the search was reasonable.

Quon appealed to the Ninth Circuit Court of Appeals, which agreed with the trial judge that the employees had a reasonable expectation of privacy. However, the Ninth Circuit rejected the trial judge’s finding on the reasonableness of the search overall, stating that, while the purpose of the search was to verify the efficacy of the 25,000 character limit, the purpose of the investigation could have been achieved by less-intrusive means (i.e., warning Quon, asking him to count the characters himself, or asking him to redact personal messages and grant permission to the department to review the redacted transcript).

The Supreme Court declined to address the issue of privacy of personal messages on company equipment, opting to dispose of the case on “narrower grounds.” Instead, the Court assumed that Quon had a reasonable expectation of privacy in the text messages, that the city’s review of the transcript constituted a search within the meaning of the Fourth Amendment, and that the principles applicable to a government employer’s search of an employee’s physical office apply to an electronic intrusion of privacy as well.

The Court then turned to the reasonableness of the search, finding that when conducted for a non-investigatory, work-related purpose or for the investigation of work-related misconduct, a government employer’s warrantless search is reasonable if: (1) it is “justified at its inception” and (2) if “the measures adopted are reasonably related to the objectives of the search and not excessively intrusive in light of” the circumstances giving rise to the search. Noting that OPD initiated the search to determine whether the vendor’s character limit was meeting the city’s needs, the Court concluded that the search was justified at its inception. The City and OPD had a legitimate interest in ensuring that officers were not paying for work-related expenses and alternatively, that the city was not paying for officers’ personal communications.

The Court next found that reviewing Quon’s messages was an “efficient and expedient way” to determine if his regular overages were work-related or personal. The Court noted that the review was not “excessively intrusive” since it covered only two months of messages and was limited to on-duty messaging. In addition, given that Quon was told that his messages were subject to auditing, the Court concluded that it would not have been reasonable for Quon to assume that his messages were “immune from scrutiny.” Thus, the Supreme Court held that the search was reasonable and the city did not violate Quon’s Fourth Amendment rights.

Although this case deals specifically with a public employer, private employers should use a similar approach when faced with an issue regarding the privacy of electronic correspondence on company computers and handheld devices, balancing privacy guarantees (based in state law or company policy) against the reasonableness of the employer's search and its purpose.
 

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In an unpublished opinion, a federal district court in New Jersey has upheld a jury verdict in which a company was found liable for violating the federal Stored Communications Act (SCA). The violation occurred when the company’s managers intentionally accessed a “chat group” on an employee’s MySpace account without having received authorization from the MySpace member to join the group. Further, the court upheld the jury’s finding of malicious conduct, which supported an award of punitive damages. Pietrylo v. Hillstone Restaurant Group d/b/a Houston’s, D.N.J., No. 06-5754, unpublished, Sept. 25, 2009.

Brian Pietrylo and Doreen Marino filed suit against their employer, Houston’s Restaurant, after two of the restaurant’s managers accessed a MySpace chat group maintained by Pietrylo during his non-work hours. The chat group, called the “Spec-Tator,” was accessed via an electronic invitation from Pietrylo. If the user accepted that invitation, he or she could access the site only by using a personal password. The site included language that indicated that the group was private, and that it was a place in which Hillstone employees could talk about the “crap/drama/and gossip” related to their workplace. No Hillstone upper manager was invited to join the group, and members accessed the site only during non-work hours and on non-company computers.

One employee/chat group member, Karen St. Jean, made a Houston’s manager aware of the site. St. Jean later provided her password to another manager, Robert Anton, who shared the information with a regional manager, Robert Marano. In spite of the privacy warning on the page, Anton and Marano accessed the site on multiple separate occasions. After determining that the content of the postings in the chat group were “offensive,” Anton and Marano fired Pietrylo and Marino.

Pietrylo and Marino then sued Houston’s, alleging, in part, that the company violated the SCA and a parallel New Jersey statute, the New Jersey Wiretapping and Electronic Surveillance Control Act. A jury found in favor of the employees, awarding modest compensatory damages, but adding punitive damages after finding that the company acted maliciously. Houston’s challenged the verdict in a motion for judgment, and requested a new trial. Both motions were denied by the district court, which found that the verdict and the damages were supported by the evidence.

Under the SCA, the plaintiffs had to prove that Houston’s managers accessed the chat group “knowingly, intentionally, or purposefully,” and without authorization. Although Houston’s argued that St. Jean willingly volunteered her password to Anton, St. Jean’s trial testimony included the fact that she would not have provided that information to Anton if he had not been a manager. Interestingly, the court’s decision turned partly on the fact that there was no documentary evidence concerning the authorization, and so the jury had to rely on the testimony and demeanor of the witnesses. The court held that the jury could infer from St. Jean’s testimony – specifically her statement that she felt that she “would have gotten in trouble” if she hadn’t provided her password – that the purported authorization was coerced. In addition, the court cited that particular testimony, in conjunction with the fact that the restaurant’s managers viewed the site on several different occasions, even though the site specifically contained warnings that it was “private” and accessible to “members only,” to support its decision to deny Houston’s motions.

While this decision is a district court case and therefore open to appeal, the decision is one of which employers should be aware. The lack of documentation regarding how the company obtained the password, the use of a self-designated “private” chat room by individuals without an actual invitation, and the continued use of the site with specific knowledge of its invitation-only status all provided a basis for the court to support the jury’s findings against the company. While employers have certain rights and obligations with respect to company-related computer equipment and electronic sites, this case points out the pitfalls of an attempt to extend that authority to non-work-related equipment and sites. This area of the law is developing quickly, and employers should be attuned to the ways in which courts are addressing the issues that arise in that area.
 

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