In a decision published yesterday, Lippman v. Ethicon, Inc. and Johnson & Johnson, the Appellate Division held that compliance officers can be whistleblowers. This decision reaches the opposite holding of another published Appellate Division case decided in 2008 – Massarano v. New Jersey Transit. Neither case is binding on the other and Lippman does not overturn Massarano.
The crux of the question is this: if you hire an employee to report safety and/or compliance concerns – and they do – can their reporting of such concerns trigger whistleblower protections under CEPA? In 2008 the Massarano court held that if an employee is “merely” doing his or her job, even if the report would constitute whistleblowing for a different employee, there are no whistleblower protections under the Conscientious Employee Protection Act (CEPA). So when Johnson & Johnson’s compliance executive claimed he was fired in retaliation for opposing the release of certain drugs and advocating for the recall of other products, Johnson & Johnson filed for summary judgment based on the Massarano decision. Johnson & Johnson claimed that the executive was actually terminated for an inappropriate sexual relationship with a subordinate employee, but, in any case, his claims for retaliation were barred by the Massarano decision. The trial court agreed and granted summary judgment to Johnson & Johnson. Dr. Lippman appealed and the Appellate Division reversed, acknowledging that they were disagreeing with their colleagues’ findings in Massarano. The Lippman court held that an employee’s job title or employment responsibilities should not be outcome-determinative in deciding whether an employee has a cause of action under CEPA. Compliance officers only need to show the same elements as any other employee to establish a cause of action.
The New Jersey Supreme Court will likely step in to resolve this question if Johnson & Johnson appeals. Until then, employers should be aware that CEPA protections may be triggered each time an employee in a compliance position makes a report to you, even if the report is required by their job.© 2014 Giordano, Halleran & Ciesla, P.C. All Rights Reserved