Green's Jewlery and Ms. Lawson Imapact Assesments

Legal Memorandum

Introduction

Greene’s Jewelry (Greene’s) of Derry, New Hampshire has filed a law suit against Ms. Lawson, a former employee of Greene’s. The lawsuit indicates that Ms. Lawson breached the confidentiality agreement with Greene’s. Ms. Lawson signed an Agreement with Howell Jewelry (Howell) to share the Ever Gold process from Greene’s before starting her position with Howell. Ms. Lawson is countersuing Greene’s for wrongful termination.

Application of the Law to the Facts

A Non-disclosure agreement (NDA), a confidentiality agreement is a legal contract defining confidential material, or information the parties will share with each other for certain purposes, with the intent to allow access to or by other parties.  Jennifer Lawson signed a binding agreement to Greene's Jewelry LLC (Greene’s). Ms. Lawson agreed to the provisions of the agreement when she signed the confidentiality agreement and was in full mental capacity when doing so.

Case Laws Regarding the Lawsuit Against Ms. Lawson

UNIFORM TRADE SECRERTS ACT (UTSA)

The fact of Ms. Lawson providing Greene’s trade secret, the process of creating the Ever-Gold Process, to Greene’s business competitor caused a breach of contract alleging the violation of the NDA she signed. This claim involves the breach of the NDA under Uniform Trade Secrets Act (UTSA).

HARVEY BARNETT, INC.,v SHIDLER & HEUMANN d/b/a Infant Aquatic Survival

It was determined in this case that Shidler and Huemann received certain confidential information from Harvey Barnett, relating to specialized methods his research led him to develop the procedures and techniques for teaching infants and children water survival, swimming and aquatic skills. It was determined that Shidler and Huemann  said confidential information was received and used ("FindLaw's United States Tenth Circuit case and opinions."). A remedy against Heumann and Shidler was assigned for breach of the confidentiality obligation that was not confined to injunctive relief: the judgement against them for $50,000 each in liquidated damages also serves as a strong incentive to comply with all the terms of a confidentiality provision.

ST. JUDE MEDICAL VS BRYAN SZWEDA

 Szweda was the vice president of operations for global manufacturing of structural heart devices for St. Jude Medical. Szweda went to work for Edwards Lifesciences, one of St. Jude’s competitors that manufactures artificial heart valves. Szweda was accused theft by swindle of taking over 4,000 files related to his work at St. Jude before he was placed on administrative leave in September 2014. The stolen files included one of St. Jude’s most restricted documents- its strategic plan which detailed a roadmap of St. Jude’s research and marketing initiatives. Szweda was charged with theft of trade secrets in Ramsey County District Court in Ramsey County, Minnesota.

The basis of this lawsuit is that Ms. Lawson violated her NDA with the Greene’s, this should be the focus and can be clearly proved. The noted case precedent listed above helps to show that Ms. Lawson not only violated her contractual agreement with Greene’s, but that she also broke the law.

Case Laws Regarding the Lawsuit Against Greene’s

DENNIS V. O'DAY v. McDONNELL DOUGLAS HELICOPTER COMPANY

McDonnell Douglas (MDHC) failed to promote Dennis O'Day (O’Day) to lead engineer at its helicopter plant in Mesa, Arizona, he was laid off as part of a general work force reduction one month later. O'Day was 46 years old, had worked for the company for fourteen years, and believed he had been denied the promotion and laid off because of his age. The night after O'Day was denied his promotion, he returned to the plant and searched his supervisor's office. He took documents that he thought might be useful to his discrimination claim, copied them, and returned the originals to the supervisor's desk. MDHC claims, and has shown through affidavits, that it would have fired O'Day had it known of his conduct. O'Day has not sufficiently rebutted this argument. Thus, MDHC would have the power to avoid its contract with O'Day. According to the comment, and the Arizona Court of Appeals interpretation, it does not matter if that power is not known at the time of the breach.

Ms. Lawson was terminated because her position was eliminated. her work habit of tardiness during her employment added to Greene’s decision to not transfer her to a position that was open. Ms. Lawson was solely formally dismissed in accordance to these reasons.

        Also, New Hampshire is an at-will state that allows employers to terminate an employee as long as it is not in violation of public policy. Greene’s did not terminate Lawson because of her pregnancy, so Greene’s should not penalized.

Ms. Lawson’s termination may be sympathized by jurors because of the timing of the announcement of her pregnancy, even though Ms. Lawson’s position with Greene’s was eliminated prior to her announcement and her tardiness was well documented.

Impact Assessment

Public Perception

When a company is brought into a legal dispute, the stakeholders of the company will be

subject to media exposure and possible a lowering of moral with employees, especially when it’s about the lay-off a pregnant employee or having the possibility of the company’s trade secret being stolen.

Greene’s determined the lay-off at the management level, however, current employees at Greene’s may believe it is unfair and be unclear of the facts behind the lay-off. Even though the lay-off eliminating the job title was planned and legal, could Greene’s looked into transferring Jennifer to another position to help her? Did Greene’s try to help Ms. Lawson who had been an employee for three years? The lawsuit could weaken employees’ confidence in the loyalty of company to their employees. The female employees may think Greene’s may be cruel and heartless to them as well in the future. Greene’s may experience employee turnover caused by this lawsuit.

Greene’s may have problems arise from employees that were laid-off in the past when they hear that an employee has taken Greene’s to the court for wrongful termination, they may think about why they were laid off. It is possible that Greene’s may face more lawsuits.

If Greene’s investors hear that they had their trade secret stolen, they may develop anticipation about continuing their investment in Greene’s. The process of creating Ever-Gold is the backbone of Greene’s business, how could the company let a junior secretary walk out the company with this confidential information. Security concerns need to be addressed. Why would investors want to invest a company who can’t protect their own crucial assets?

The lawsuits will bring negative social impact on the company. The public could just remember that Greene’s had confronted a pregnant woman. It could be possible that Greene’s will lose customers because their customers may purchase from another company that benefited from the Ever Gold process was taken by Ms. Lawson.

The Pregnancy Discrimination Act of 1978 is a United States federal statute. It amended Title VII of the Civil Rights Act of 1964 to "prohibit sex discrimination based on pregnancy." Wrongful discharge suits may be brought in situations where the employer has retaliated against an employee for exercising a right that is supported by the law.

        Young vs. United Parcel Service, Inc. is a U.S Supreme Court case involving a female driver for the United Parcel Service (UPS).  In 2006, Peggy Young requested a leave of absence to undergo in vitro fertilization, her doctor advised her to not lift more than twenty pounds during pregnancy. Due to this limitation, the UPS forced Young to take an extended, unpaid leave of absence in which she lost her medical coverage. Young sued UPS and claimed she had been the victim of gender-and disability-based discrimination under the Americans with Disabilities Act and the Pregnancy Discrimination Act. UPS countered her suit by stating they had no obligation to offer Young accommodations under the Pregnancy Discrimination Act because Young's pregnancy did not constitute a disability. The district court dismissed Young's claim and the U.S. Court of Appeals for the Fourth Circuit affirmed (2015). As in the case with Peggy Young, Ms. Lawson is filing a false claim due to the fact that a pregnancy is not a physical condition due to a disability protected by law.

Non-disclosure agreements are governed by contract law and contract law does not provide for penalties.  In Ms. Lawson’s case, breaching the confidentiality agreement from Greene's would require Greene’s to sue to recover damages.

Impact Assessment: Damages

Damages

Even if the company wins the lawsuit, people may still consider Greene’s decision to terminate Ms. Lawson was due to her pregnancy. Investors may think the Greene’s security practices are weak. Greene’s may see employee turnover, customers switch to other competitors, and the divestment of investors. Greene’s should move to change specific business practices.  Proactive actions could contribute to preserving Greene’s reputation with the general public.  

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