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E-Mail Dangers for Employers

Posted by Frank Steinberg | Mar 24, 2009 | 0 Comments

From time to time we've focused on the liability dangers that a company e-mail system can create for employers.  Here are two more recent examples that arose in different contexts.

 In Van Alstyne v. Electronic Scriptorium, Inc., the plaintiff was employed by a small data conversion company.  She was assigned a company e-mail account but also occasionally used her personal, password-protected AOL account to do business.  She was sexually propositioned by her president but declined his advances.  She was later fired.

In the course of litigation Van Alstyne deduced that someone at Electronic Scriptorium had broken into her personal e-mail account.  That turned out to be ES's president,  She then sued for statutory damages, punitive damages and attorneys fees under the Stored Communications Act, 18 USC 2707(a).  She won $175,000 in compensatory damages and $100,000 in punitive damages.  She was also awarded attorney's fees and costs of more than $135,000.

On appeal the story had a slightly happier ending for the employer.  The 4th Circuit vacated the award of compensatory damages since plaintiff had not proven "actual damage." 

However, the court ruled that "actual damage" is not required to entitle the plaintiff to attorney's fees or punitive damages.

I doubt whether ES's president thought that he was letting himself in for this kind of trouble when he decided to peruse the private e-mails of the object of his office affections.

The second case is Noonan v. Staples from the 1st Circuit.  Here an employee was found to have violated Staples's expense reimbursement policy.  An executive VP decided to make an example of the offender and broadcast an e-mail containing his name and offense to 1500 employees.

Despite the fact that the information was true — the employee had violated the policy — the court found that Staples had libeled the employee.  The ruling is confounding to the extent that it violates the first maxim of defamation law: the truth is an absolute defense.  Apparently not any more, at least not in the First Circuit.

I wonder whether the Executive VP who decided to use a broadcast e-mail to humiliate a terminated employee, and in the process teach other employees a lesson, would have done so if the ability to do so wasn't just a click of his "send" button away.  E-mail is a useful tool, but one that often seduces us to act without thinking through the possible consequences of our actions.  A little time and some careful thought might have saved the defendants in these two cases a lot of time, trouble and money.

About the Author

Frank Steinberg

Frank is the founder and principal of Steinberg Law, LLC. A Jersey boy born and bred, he focuses on employment litigation and counseling, business litigation,  and aviation law. Following law school and a clerkship in the federal district court Frank spent his early career with large litigation ...

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