Facebook Demand Laws: Closing In On Double Digits

Posted on May 29, 2013 by Michael Schmidt — No Comments ↓

What is in a number? In particular, the number 9? Does it mean anything to you, or symbolize anything in particular?

Even the most basic research reveals:

In Chinese culture, the number 9 is associated with the Chinese dragon as a symbol of power and magic, although the Japanese apparently consider the number 9 to be unlucky.
Dante’s Divine Comedy contains 9 circles of Hell.
The number 9 is the highest single-digit number in the decimal system.
9 months is the normal period of human pregnancy.
There are 9 innings in baseball, and 9 players on the field.
Roger Maris wore the number 9 for the New York Yankees, as did Reggie Jackson for the Oakland A’s, Ted Williams for the Boston Red Sox, Gordie Howe for the Detroit Red Wings, and Clark Gillies for the New York Islanders.
Cats are said to have 9 lives.
There are 9 justices sitting on the United States Supreme Court.

Oh, and the State of Washington just became the 9^th state to enact a “Facebook demand” law.

Employer Take Away: What should you as an employer take away from this development?

The first two or three states were kind of fun to write about, as the issue was still somewhat novel. States four through eight represented an opportunity for me to wax poetic on such issues as “Is the employer-demanding-Facebook-password-information problem really a problem?” and “Why are legislatures seemingly able to work quickly and cohesively to pass legislation on this?”

But now that we’re at the ninth state, I confess that I am bored with this topic. Yet, I feel strangely compelled to continue to update this list for those who are keeping track at home through this blog: Arkansas, California, Colorado, Illinois, Maryland, Michigan, New Mexico, Utah, and now Washington. Some of the laws are the same (employers cannot require applicants or employees to turn over account information, and cannot retaliate against those that do not), and some of the laws contain somewhat unique language, such as Washington, whose new law also states that employers may not “compel or coerce an employee or applicant to add a person, including the employer, to the list of contacts associated with the employee’s or applicant’s personal social networking account[.]” In other words, you can’t force them to be your friend.

For those in these 9 jurisdictions, re-consider if you were considering making such a request or demand. For those outside those 9 jurisdictions, do you really want to be seen as an employer making such a request or demand in any case?

Michael Schmidt

Michael C. Schmidt is the vice chair of the firm’s Labor & Employment Department, and the office managing partner, vice chair, of the New York Midtown office, where he is resident. For more than two decades, Mike has concentrated his practice on representing companies and management in all facets of employment law, such as: (i) defense in litigation involving wage and hour (overtime and unpaid compensation), discrimination, harassment, retaliation and whistle-blowing, non-competes and trade secrets, and disability and other leave-related issues; (ii) day-to-day counseling and in-house training on issues from hiring to firing, and other questions unique to his client’s industries and business; and (iii) drafting and reviewing employment agreements, termination and severance agreements, confidentiality and non-competes, and employment policies and manuals.

More Posts - Website

Follow Me:

Posted in General Social Media/Employment Law Discussion

Employee Working For You? You Say “No”, LinkedIn Says “Yes”

Posted on May 20, 2013 by Michael Schmidt — No Comments ↓

Those loyal readers of this blog know that the focus tends to be on what your company can and cannot do regarding social media use by potential employees (i.e., applicants) or current employees. But there is a third category of employees that warrant a share of the spotlight here: former employees.

Like some of the prior issues in this blog, such as addressing who maintains ownership of social media accounts and followers upon an employee’s separation, how your company proceeds with respect to what an individual who no longer works for your company says or does through social media is of vital importance for you to consider as well.

Which brings me to the interesting decision in Jefferson Audio Visual Systems, Inc. v. Gunnar Light from a federal court in Louisville, Kentucky. The defendant Light was a Managing Director of International Sales for JAVS (the plaintiff employer). JAVS asked Light to meet with the company’s sales agent in South Africa to arrange for a potentially lucrative sale of audiovisual systems. Unfortunately, according to the complaint, Light made several defamatory statements to the sales agent about JAVS during his meeting, which resulted in a mere $150,000 sale, rather than the $20 million in gross revenue that the company had anticipated. Shortly after, JAVS fired Light and then filed a lawsuit against Light alleging fraud, defamation, and other claims. Light sought early dismissal of the lawsuit.

Of interest here is JAVS’ claim for “fraudulent misrepresentation”:

“JAVS claims that for several months following Light’s May 9, 2011 termination from JAVS, Light falsely represented on social media outlets, such as LinkedIn, that he held the positions as JAVS’ International Managing Director after his date of termination.”

It apparently took three company requests (and threats) before Light changed his profile page to remove any representation as to his then-employment status with JAVS.

Seem clear cut? Not necessarily from a technical law standpoint (why does the law so often get in the way of you running your business?), as the court dismissed the fraud claim despite Light’s reference to being an employee of JAVS even after his termination. The problem was that, under Kentucky law, a fraudulent misrepresentation claim required proof that the company was defrauded by the LinkedIn representation. Here, at best, JAVS was alleging that third parties and the public would have been defrauded. As a result, Kentucky law offered no legal solace.

Employer Take Away: What should you as an employer take away from this development?

If your company’s office is in Kentucky, maybe not much. But for the rest of you, there are some valuable reminders here.

Whether or not you ultimately take any action based on what you learn (and that should be the subject of a different, and detailed discussion), your company should continue to mine the social media trails of any employees who leave your employ. First: just because they don’t appear to be disgruntled when they leave, it doesn’t mean that your valuable interests are not put at risk, even unintentionally. Has your employee disclosed information online that the company considers to be highly proprietary or trade secret information? Has your employee made statements that would be considered defamatory, or in violation of a non-compete or non-solicitation agreement?

Second: just because Kentucky law may not provide a common law remedy to the problem in this case (at least based on the arguments raised by the parties in this case), it doesn’t mean that the jurisdiction in which you conduct business does not. There are many reasons not to be complacent (or even complicit?) when a former employee says or does something through social media that threatens your trademark or trade secrets. Your jurisdiction may recognize a fraud-based claim under these facts, or perhaps an alternative common law or statutory theory worth pursuing.

For as we have said before, the worst thing you can do is close your eyes and pretend that social media does not exist.

Michael Schmidt

More Posts - Website

Follow Me:

Posted in Opinions

The “Employee Tricked Me Into Firing Her” Defense

Posted on April 26, 2013 by Michael Schmidt — No Comments ↓

The NLRB continues to issue decisions about whether an employer can lawfully terminate employees based on social media activity, and whether workplace policies violate the law protecting employees’ rights to engage in protected concerted activity. However, last week’s decision in In re Design Technology Group, LLC had an interesting twist.

Wikipedia places the root of the word “entrapment” as follows: “The word entrapment, from the verb ‘to entrap’, meaning to catch in a trap[.]” Thanks, that was helpful. It goes on to say: “In criminal law, entrapment is conduct by a law enforcement agent inducing a person to commit an offense that the person would otherwise have been unlikely to commit. In many jurisdictions, entrapment is a possible defense against criminal liability.” Can an employee defend a Facebook firing case by arguing that it was “entrapped” into firing the employees?

The employer in In re Design Technology Group runs an “upscale women’s clothing store”. Two claims were at issue in the hearing before an ALJ. First, the ALJ held (confirmed?) that the employer violated the National Labor Relations Act by having a handbook policy that prohibited the disclosure of employee wages or compensation to other employees or a third party. Although many companies still create such a prohibition in manuals and contracts, the ALJ’s holding is consistent with what has been the NLRB’s position for some time.

The second claim, however, is a tad more interesting. Three sales employees were discussing several work-related issues in person, and their discussion continued on Facebook. Among the complaints made were about how the store manager treated them and other store employees. The store manager later learned about the complaints, and subsequently fired the employees. At the hearing, the employer made much about the fact that the employees were “giggling and smiling” at the termination meeting, and that Facebook posts after the meeting suggested that the employees were happy to have been fired, and perhaps even set up the circumstances in order to get fired and sue the employer.

Adopting the ALJ’s decision, the NLRB was not persuaded by the employer’s defense:

The judge correctly rejected the Respondent’s ‘discharge conspiracy’ theory. The Respondent contends that the Facebook postings were not protected because the employees had ‘no honest and reasonable belief’ that the purpose of their conduct was for the mutual aid and protection of employees’ and that instead, the employees ‘schemed to entrap their employer into firing them.’ The judge found the conspiracy theory to be ‘nonsensical,’ and we agree. There is no credible evidence that the employees’ actions were undertaken to entrap the Respondent into committing an unfair labor practice. But even if the employees were acting in the hope that they would be discharged for their Facebook postings, the Respondent failed to establish that the employees’ actions were not protected by the Act.

Employer Take Away: What should you as an employer take away from this development?

The NLRB says that entrapment is not a valid defense to a proposed violation of employees’ rights to engage in protected concerted activity. That is, if the employees did engage in protected concerted activity under the National Labor Relations Act, it does not matter if they did so for the purpose of getting fired. Although the decision seems to toss aside the notion that a good faith intent to be engaging in “mutual aid and protection of employees” is required to show that conduct is “protected concerted activity” in the first place, in the end the ALJ was clearly not impressed with the testimony or general credibility of those who appeared on behalf of the employer at the hearing.

It remains to be seen whether an “entrapment”-like defense to these cases will gain any traction in later cases. For the time being, it would behoove you to focus less on the motives of the employees engaging in certain conduct, and more on whether the conduct itself is protected, before deciding to take some adverse action because of the conduct.

Michael Schmidt

More Posts - Website

Follow Me:

Posted in Opinions

Employment Law Lessons From Chicken And Rice

Posted on April 11, 2013 by Michael Schmidt — No Comments ↓

Let’s first dispense with the opening hook by asking: Was Rutgers University acting “chicken” when it (finally?) chose to fire Coach Mike Rice only after public outrage over events that took place last year? Whether or not the masses agree that Rice should have been fired immediately last year when school officials first learned of his conduct toward his basketball players, there is no denying the tremendous role that social media played in the termination. But buried in the emotional outrage and sports talk is also a significant lesson to be learned by employers when it comes to how and when termination decisions are made.

College basketball insider Gary Parrish (cbssports.com) penned – well, really, typed – a terrifically-succinct piece that frames the issue: “[T]hese days it’s possible to survive an inexplicable act, but the reaction to that act will get you almost every time.” Parrish describes what has, by now, been clear to all of us: whether right or wrong, Rice was fired because of the intense social media backlash to the released video clips, and not because of what those clips showed.

Some might say that the story highlights the benefits of social media; that, however it happened and whatever prompted it, the employer ended up getting the employment result (Rice’s departure) correct, thanks to the impact of social media. But the larger issue for employers to consider is whether there is a consequence to waiting to make the decision like Rutgers did. And not simply from a public relations standpoint.

Suppose your employee has an employment contract that gives the employee severance if he is terminated without “cause”, and provides for no severance if he is terminated for “cause”. The term “cause” is defined in different ways, but typically requires more than simply “I don’t think he did a good job”. Assuming those contract provisions in Rutgers’ case, Rice was arguably not terminated because of the conduct displayed in the video clips that might trigger the “cause” provision. Instead, Rice was only suspended at the time and then allowed to return to work.

Rice was terminated later on, but one might argue that the eventual termination was not for “cause” because the underlying “cause” conduct was addressed with the prior suspension, and no similar conduct had taken place since then (as far as we know). That argument would say that he was fired instead because of public relations, public outcry, social media backlash, etc. If that argument holds, and the termination is not deemed to be because of the “cause” ground, the employer (Rutgers) could be on the hook for contractual severance owed in the case of a termination that is without “cause”. Depending on the amounts at stake, significant financial consequences indeed.

Employer Take Away: What should you as an employer take away from this development?

Clearly, any termination-related decision should be considered and reviewed seriously by the appropriate personnel. But the timing of your decision is a significant factor to include in that consideration and review. As noted above, the timing of the termination may impact whether the departing employee is owed any severance or anything else under your company’s contract or policy. And timing will also affect your ability to defend a termination decision in a lawsuit, since it may be harder to defend against claims of discrimination or retaliation when the act that you contend served as the basis for the termination decision happened a good amount of time before the termination was effectuated by you.

So you should ask yourself two questions when considering an employee termination:

1. Can you articulate (and justify) the true reason for making a termination decision?

2. Have you acted timely, and reasonably, in carrying out the termination decision?

If you cannot answer “yes” to both questions, you may go from a cute little chicken and rice helping to a much larger beef with your company.

Michael Schmidt

More Posts - Website

Follow Me:

Posted in General Social Media/Employment Law Discussion

The Duty To Preserve Social Media Information

Posted on April 10, 2013 by Michael Schmidt — 1 Comment ↓

It is not, as many recent articles and blogs have discussed, just about whether relevant social media information can be discovered by one party in a lawsuit. It is also about what happens when a party fails to preserve potentially-relevant social media information in the first place, and that information subsequently gets destroyed and becomes non-discoverable. A federal district court judge in New Jersey recently upped the ante.

In Gatto v. United Air Lines, the plaintiff was an airline ground operations supervisor who was injured when a set of fueler stairs crashed into him. As is typical nowadays in the personal injury world, defendants sought social media account information in discovery to obtain relevant information about plaintiff’s damages and social activities, all in an effort to defend the personal injury claims. In the course of a dispute over the scope of access, plaintiff’s password was given to defense counsel, who apparently (and without plaintiff’s or plaintiff’s counsel’s knowledge) accessed plaintiff’s Facebook account and printed some portions of the Facebook page.

Not knowing that defense counsel had accessed the account, plaintiff received a notice from Facebook advising that his account had been accessed from an unknown computer. As a result, plaintiff deactivated his account, which resulted in all of the information and documents being lost due to an automatic 14-day deletion practice of Facebook upon a deactivation. Defendant requested that the court penalize plaintiff with sanctions for “spoliation”, which essentially means the destruction or significant alteration of evidence, or where a party fails to “preserve property for another’s use as evidence in pending or reasonably foreseeable litigation.”

The court agreed with the defendant, finding that “it is beyond dispute that plaintiff had a duty to preserve his Facebook account at the time it was deactivated and deleted.” But the court went further, noting that plaintiff’s intent (or, more pointedly, any lack of a nefarious intent) was largely irrelevant:

“Even if Plaintiff did not intend to permanently deprive the defendants of the information associated with his Facebook account, there is no dispute that Plaintiff intentionally deactivated the account. In doing so, and then failing to reactivate the account within the necessary time period, Plaintiff effectively caused the account to be permanently deleted. . . . As a result, Defendants are prejudiced because they have lost access to evidence that is potentially relevant to Plaintiff’s damages and credibility. In light of all of the above, a spoliation inference is appropriate.”

For those scoring at home, a “spoliation inference” is an instruction that a judge gives to a jury at the end of a trial that allows them to draw an inference that the contents of destroyed evidence would have harmed the party that prevented production of that evidence.

Employer Take Away: What should you as an employer take away from this development?

Court decisions are going to continue to be issued, not only about social media discovery, but about the affirmative duty to preserve social media information in certain circumstances, and the consequences of not meeting that duty. The rules apply equally to plaintiffs and defendants, and will apply across all types of cases, including employment law cases.

A couple of lessons for you and your company:

1. When your litigation is deemed appropriate for discovery on social media, make sure requests are served on the employee’s counsel as soon as possible. It is certainly at that point, if not sooner, that the employee will have a duty to preserve potentially-relevant information that can be obtained through social media, and ensure that it does not get destroyed even unintentionally.

2. It is equally critical to understand that the preservation rules apply to you. Make sure the appropriate “litigation hold” memo is distributed to the appropriate custodians at the appropriate time, and make sure that the memo includes all potentially-relevant social media sources as well.

Michael Schmidt

More Posts - Website

Follow Me:

Posted in Opinions

Feeling Cyber-Secure: Avoiding The Devastating Hacker

Posted on April 8, 2013 by Michael Schmidt — No Comments ↓

Pro-actively drafting cybersecurity policies and protocols is like doing a will for yourself, or an employee manual for your company. The thought process is that there is nothing imminently pressing that requires me to think about (or spend the time and money doing) either, and the problems fixed by both will “never happen to me.” But the world is changing rapidly, and the “it” in the “it will never happen to me” is all of a sudden happening to companies all around you when it comes to cyber risks, and data and privacy breaches.

According to a recent article in BusinessInsurance.com, “[m]ore than half of U.S. small and midsize businesses have experienced at least one data breach[.]” . . . The primary causes of the data breaches were employee or contractor errors, lost or stolen laptops, smart phones and storage media and procedural mistakes[.]” Want a more stark framing of the issue? The Los Angeles Times has reported that top U.S. intelligence officials claimed last month that “cyber-attacks and cyber-espionage pose a greater potential danger to U.S. national security than Al Qaeda and other militants that have dominated America’s global focus since Sept. 11, 2001[.]”

The loss from a data breach and crack in your company’s cybersecurity can range from millions of dollars in monetary loss, to the loss of critical, and proprietary, company information, to the reputational harm done to your business. The problem, and potential solutions, has gotten the attention of our government and corporate America. For example:

President Obama signed an Executive Order to improve the sharing of information between the government and private sector, which comes on the heels of Congress’ recently-introduced cyber-legislation. The Executive Order directed the development of a Preliminary Cybersecurity Framework.

On March 6, 2013, the Congressional Homeland Security Committee held a hearing titled “[Department of Homeland Security] Cybersecurity: Roles and Responsibilities to Protect the Nation’s Critical Infrastructure.”

A recent survey released by AIG suggests that “[c]orporate executives these days are more concerned about cyber-attacks than they are about income loss or property damage[.]”

More than 140 businesses and governmental agencies, mostly in the United States, reported that their data had been hacked, with cybersecurity firm Mandiant surmising that the Chinese government has been behind some of the activity. The list of corporate entities hacked in 2013 alone according to news reports: Facebook, Microsoft, Apple, NBC, The New York Times, Burger King, Jeep. In many cases, employees of the hacked company will use a company computer to visit a legitimate website that has had its pages compromised by a hacker, which then allows the hacker to infiltrate the employer’s resources, information and database through the unknowing employee’s computer. If these companies can be hacked…

Employer Take Away: What should you as an employer take away from this development?

Three questions for you:

1. Have you reviewed your existing insurance coverage to make sure your company has sufficient coverage to protect against technology and cyber-privacy risks?

2. Have you developed adequate internal policies and protocols to address employee data disclosure, employees who bring their own devices into the workplace (“BYOD policies”), and whether and to what extent you are required to notify employees and others in the event of a data or privacy breach?

3. What are you waiting for?

Michael Schmidt

More Posts - Website

Follow Me:

Posted in General Social Media/Employment Law Discussion

Re-Tallying The Facebook Demand Laws

Posted on February 13, 2013 by Michael Schmidt — No Comments ↓

I trust that, of all the social media and employment law issues we discuss, you are most sick of hearing about the legislative efforts to prohibit Facebook password demands by employers. Or you just don’t care. Or you still don’t think it’s truly a problem that needs a legislative response.

But duty calls here at this blog, and it’s time for a reset to re-tally the score. Last week, the federal government reintroduced a bill that would proscribe demands for social media passwords in certain situations. Much as there has been the same push on the state level. In fact, as you know, Maryland, Illinois, California and Michigan have already enacted laws that prohibit employers from demanding account information from applicants and current employees, while New Jersey and Delaware have passed laws that do the same thing with regard to higher education institutions demanding social media account information from students or prospective students.

Many states are currently considering pending social media privacy bills, including Connecticut, Georgia, Hawaii, Kansas, Missouri, Montana, Nebraska, New Hampshire, North Dakota, Oregon, Texas, and Vermont. Others, such as New York, have previously introduced bills, and will undoubtedly do so again in 2013.

The federal bill re-introduced last week as the proposed “Social Networking Online Protection Act” attempts three primary things: (1) Prohibit employers from requiring or requesting that an employee or applicant give user name or password information to access a private e-mail account or social networking site (and from disciplining or refusing to hire an employee or applicant for refusing to give the information); (2) Amend the federal Higher Education Act of 1965 to prohibit institutions of higher education from making the same requirement or request (and from disciplining or denying admission for any current or potential student who refuses to give the information); and (3) Amend the Elementary and Secondary Education Act of 1965 to accomplish the same thing for local educational agencies receiving federal funds.

Employer Take Away: What should you as an employer take away from this development?

Despite what appears to be the lack of public outcry on this issue at this point, or any word of widespread employer or school conduct on this issue, legislative leaders on all levels are still pushing this issue into law. Keep reading and watching.

Michael Schmidt

More Posts - Website

Follow Me:

Posted in General Social Media/Employment Law Discussion

Online Relationships – Catfish On The Table

Posted on February 8, 2013 by Michael Schmidt — No Comments ↓

I ended 2012 as I have the past couple of years, highlighting my view that, while technological advances are great in many respects, it’s still the inter-personal relationships that lead to success in our professional and personal lives. But that was not intended to ignore that online relationships are very much a reality today, and require employer and HR awareness of several issues.

Hear about Manti Te’o? Hear enough about Manti Te’o? Me too. For those too busy to read, hear or see the news lately (which means you’re probably not reading this), Te’o is the college football linebacker at the University of Notre Dame who first made headlines with his strong play in 2012 after the apparent death of his girlfriend and grandmother at the same time. He then made headlines last month when it was revealed that his girlfriend’s existence and death had been faked, and that he was apparently hoaxed into believing that he was involved in a purely online relationship with a woman who didn’t exist. The University (akin to his “employer”) came out in full support, but clearly had to address the issue.

Out of this drawn-out story comes a heightened awareness of online relationships. And the term “catfishing”. As explained by Ben Zimmer, correspondent for the Boston Globe, the term “catfish” (used these days as a verb) describes “someone who pretends to be someone they’re not using Facebook or other social media to create false identities, particularly to pursue deceptive online romances[.]” The humanized activity of catfishing seems to stem from the act of those who shipped live codfish in vats and then put catfish in the vats to “keep the cod’s flesh from getting mushy” and “keep the cod agile”. In other words, the catfish was used to make the codfish feel and be more alive.

Who would’ve thought we could learn a new and interesting term from yet another story about an athlete?

Employer Take Away: What should you as an employer take away from this development?

It is not truly relevant whether Manti Te’o was having a “real” virtual online relationship, or whether he had been “catfished” into thinking he was having one. What is relevant is the effect that a similar story involving one of your employees can have on your workplace.

Employers are obviously limited in what and how they can regulate lawful off-duty activities, but you should at least add this concept to your company’s checklist of HR sensitivities and ask yourself 5 questions:

1. Does your company truly understand the reality of online, virtual relationships in 2013 and how they may be impacting your employees?

2. Does your company have an appropriate policy and practice regarding fraternization, workplace romance, and “love contracts”?

3. Does your company’s policies and training on harassment and discrimination include a discussion of online relationships?

4. Does your company’s policies and training on violence in the workplace and domestic abuse address the perils and pitfalls of online relationships?

5. Does your company’s policies and training on general workplace rules and productivity deal with the time spent by employees communicating online and playing online games?

What do you do now if you’ve answered “no” to any of these? Ok, I know, that was 6.

Michael Schmidt

More Posts - Website

Follow Me:

Posted in General Social Media/Employment Law Discussion

Sign Of The ‘Times’ – It’s Still The Rage

Posted on January 22, 2013 by Michael Schmidt — No Comments ↓

Wow. Front page of the New York Times Business Section. This stuff must be important.

Steven Greenhouse authored a piece in yesterday’s Times, in which he summarizes the lay of the land with social media and the workplace. He does not take a particular position, but does a good job summarizing many of the developments we’ve been touching on here in terms of Facebook firings, password demand laws, and social media policies. With the latter, Greenhouse notes how federal regulators – most prominently the NLRB – “have declared many [] blanket restrictions illegal.”

I agree with the article’s take on the concerns resonating among the business community that the NLRB “is intervening in the social media scene in an effort to remain relevant as private-sector unions dwindle in size and power.” But I also think it is more than simply that the NLRB wants to stay on the map even with reduced union strongholds (even assuming that’s true). I think, in the current Obama administration, we are seeing another arm of the federal government viewing itself as a pro-employee activist body. There is no reason to think that the NLRB will be any less so in the second term of this administration that began yesterday.

Employer Take Away: What should you as an employer take away from this development?

Even the New York Times has deemed these social media and employment law issues to be worthy of the front page. But to the loyal followers of this blog, aren’t you glad this wasn’t exactly news to you at this point?

Michael Schmidt

More Posts - Website

Follow Me:

Posted in General Social Media/Employment Law Discussion

Confidentiality From The Boardroom To The Bedroom

Posted on January 14, 2013 by Michael Schmidt — No Comments ↓

Sometimes we can learn valuable employment law lessons from even the non-employment law court decisions.

What happens if the boardroom meeting to discuss your company’s trade secrets ends up as pillow talk between an employee and his or her spouse? As I’ve been suggesting, notions of “confidentiality” and “privacy” when it comes to social media and electronic communications are going to be big topics for pundits in the coming months and years, and a recent decision by the 4^th Circuit Court of Appeals provides an interesting takeaway.

In United States v. Hamilton, the defendant apparently sent some incriminating notes to his wife from his work e-mail account, and was unable to rely on the “marital privilege” to shield those notes from disclosure at his trial. This was not an employment law case per se, but a criminal proceeding in which the defendant was convicted and sentenced for alleged bribery and extortion. Defendant was a state legislator, and also worked as a part-time employee for the Newport News public school system. At his trial, the jury found that defendant used his position as a legislator to obtain funding for, and an employment position with, a newly-formed “Center for Teacher Quality and Educational Leadership” at Old Dominion University.

One of his principal attacks on appeal was the trial court’s decision to allow the government to introduce into evidence certain e-mails that he sent to and received from his wife. The appellate court began its discussion by recognizing that “[c]ommunications between . . . spouses, privately made, are generally assumed to have been intended to be confidential, and hence they are privileged.” Yet, the court recognized the flip side of that coin: “But, of course, to be covered by the privilege, a communication between spouses must be confidential; ‘voluntary disclosure’ of a communication waives the privilege.” The government alleged that such a waiver took place when the defendant engaged in his communications through his work e-mail account on his workplace computer.

The appellate court agreed, analogizing today’s communications through an e-mail system to communications of the past made through the aid of a third-party stenographer. In both cases, the supposed confidential communication has been voluntarily revealed through someone (or some domain), thereby breaking the privilege chain:

“In an era in which email plays a ubiquitous role in daily communications, these arguments caution against lightly finding a waiver of marital privilege by email usage. But the district court [properly] found that [defendant] did not take any steps to protect the emails in question, even after he was on notice of his employer’s policy permitting inspection of emails stored on the system at the employer’s discretion.”

Employer Take Away: What should you as an employer take away from this development?

If something is meant to be confidential, keep it confidential. Don’t send it in an e-mail to someone outside the company – even a spouse – under the auspices that some evidentiary privilege will forever cloak the communication.

For one, make sure your electronic communications policy is most current and most effective, and, perhaps just as critically, make sure all of your employees know what is protected and what could be monitored.

Secondly, and this applies not only to employees, but to those of you who actually own the company as well, take similar care in understanding and advising everyone in the company that your trade secrets may no longer be afforded the same protection if they are disclosed to a third party through e-mails, even to your non-employee spouse. As we continue to learn and confirm, social media and confidentiality make for strange bedfellows.

Michael Schmidt

More Posts - Website

Follow Me:

Posted in Opinions