When a company learns that its employees may have done something unlawful, it should try to get the facts and figure out whether wrongdoing actually occurred. One way to do this is to conduct an internal investigation, in which attorneys or other investigators collect documents and interview employees to gather information about what happened.
But what happens when employees refuse to cooperate? Can they be fired and denied severance benefits that would otherwise have been due?
After a spate of horrific shootings at schools and businesses across the country, employers started conducting unannounced “active shooter” drills to train employees how to react if a murderous gunman shows up at their workplace. Unsurprisingly, some of these unannounced drills have gone awry.
In 2013, the Pine Eagle Elementary School in Halfway, Oregon, population 286, held an active shooter drill that was too much for its employees to bear. Now, Pine Eagle finds itself in the middle of a lawsuit in Oregon federal court, brought by former teacher Linda McLean.
It is the norm for high-achieving employees to strive for and tout their successes. Recently, however, one person’s novel reaction to failure—his own termination—may show a future employer as much about his character as any of his considerable accomplishments.
Sree Sreenivasan was plucked from Columbia’s School of Journalism a few years ago to become the New York Metropolitan Museum of Art’s chief digital officer. According to Quartz, Mr. Sreenivasan brought the famed museum into the digital age through inventive social outreach efforts and a revamped, mobile-friendly website.
Owners of stolen trade secrets now have another weapon in their arsenal.
Last month, President Obama signed the Defend Trade Secrets Act (the DTSA), which creates a new cause of action in federal court for the misappropriation of trade secrets. The DTSA does not preempt state laws governing misappropriation of trade secrets, so employers and other trade secret owners may now bring actions under the DTSA and applicable state laws. See 18 U.S.C. § 1838.
When a former officer or director of a company must defend against legal claims, advancement of legal fees by the company can be critical to a successful defense. The Delaware Chancery Court frequently addresses issues related to advancement of fees for former officers and directors. For example—as we discussed in this post—that court recently resolved a claim by former Vice President Al Gore and a colleague for advancement of legal fees, ruling that they were entitled to advancement from the company that bought their employer (Current Media) and assumed Current Media’s indemnification and advancement obligations, even though they had never worked for the purchaser
What happens when an employer tries to change the basis for terminating an employee?
Recently, the Supreme Judicial Court of Massachusetts considered whether an employer could change the basis for the termination from “without cause” to “with cause” and withhold severance benefits otherwise owed the former employee. In EventMonitor, Inc. v. Leness, the employee won the battle, but the cost may have consumed the spoils of war.
Last week, the U.S. Supreme Court issued a plaintiff-friendly decision resolving disagreements over the question of when a constructive discharge claim accrues. The lower courts didn’t agree on when the clock should start ticking on claims by employees that they were forced to quit, creating uncertainty for plaintiffs who faced the possibility that their claims would be barred by the statute of limitations if they didn’t sue soon enough.
When the Department of Justice announces new guidance for individual and corporate prosecutions, the white collar bar takes notice.
Thus, in September 2015, when the Department of Justice released a memorandum titled “Individual Accountability for Corporate Wrongdoing”—now colloquially known as “the Yates Memo” because it was authored by Deputy Attorney General Sally Yates—almost everyone had something to say about it.
The Yates Memo seeks to increase the emphasis on individual accountability for corporate wrongdoing from the outset of a government investigation. It sets forth six steps to strengthen pursuit of individuals by criminal and civil prosecutors, including requiring corporations to lay out all relevant facts related to individual misconduct in order to obtain cooperation credit.
For both companies and individual officers and directors, it’s critically important to know the protections that are available to corporate leadership before a company runs into trouble.
The Delaware Chancery Court’s recent decision in Hyatt v. Al Jazeera America Holdings II, LLC, presents an unusual twist on the typical advancement litigation. It highlights how proper planning can ensure the intended protections are available when they are needed.
Typically, advancement cases follow a familiar pattern: a company promises officers and directors (and sometimes employees) that in the event of legal proceedings related to their duties at work, they will be protected by advancement of legal costs and indemnification.
As employees of the New York-based Chobani yogurt plant filed into work last Tuesday, they were met with sealed, white envelopes containing a sweet financial surprise.
Little did they know, the owner and CEO, Hamdi Ulukaya, had been working with the human resources consulting firm, Mercer, to hatch a plan to transfer 10 percent of his stock in the company to roughly 2,000 full-time employees.