Week Ending 12/27/13: State v. Saavedra

Alan Schorr’s Employment Case of The Week ending December 27, 2013

State v. Saavedra, N.J. Super. (N.J. App. Div., December 24, 2013)

The Appellate Division’s published decision last week in State v. Saavedra is causing a shock wave among the plaintiff employment bar. In this criminal case, the appellate panel, in a 2-1 majority opinion with dissent, ruled that although a conscientious employee who removes or copies employer documents for use in a whistleblower or discrimination case may be protected civilly, that same employee may be criminally prosecuted for stealing the documents, even though the documents were only provided to her attorney.

Ivonne Saavedra was a clerk for the North Bergen Board of Education. In November 2009, Ms. Saavedra and her son sued the Board and some individuals under a variety of causes of action, including CEPA and NJLAD. During discovery in the civil case, Saavedra’s attorney produced “hundreds of documents owned by the Board”. The Board’s attorney brought the matter to the Hudson County Prosecutor, who determined that the matter should be presented to a grand jury. The Board’s general counsel was the only witness before the grand jury, and he testified that Ms. Saavedra had taken “high confidential” and “very sensitive” documents. The grand jury indicted her for “official misconduct” and “theft of movable property”, and she moved to dismiss the indictment.

At the motion hearing, Saavedra’s criminal defense counsel argued that she had taken the documents for a lawful use. Citing the case of Quinlan v. Curtiss–Wright Corp., 204 N.J. 239 (2010), defense counsel argued that “Quinlan says it’s legal to take confidential documents” and that preventing defendant from taking confidential documents would have a chilling effect in future LAD cases. The State maintained that Quinlan did not create a bright-rule permitting a public servant to take highly confidential documents (such as student medical and educational records).

The motion judge, Lisa Rose, of Hudson County, concluded that Ms. Saavedra failed to meet her heavy burden of demonstrating that the State had not prima facie shown that a crime had been committed. The judge also ruled that Quinlan did not hold that removal of documents from an employer for use in a LAD suit is per se lawful. Ms. Saavedra filed an interlocutory appeal which was accepted by the Appellate Division.

The majority found that Quinlan was distinguishable in that the employer in Quinlan was a private employer. The majority rejected Ms. Saavedra’s argument that the State should be prevented from introducing evidence that she had unlawfully taken the documents. The majority ruled that, while Saavedra could use her belief that it was lawful to remove the documents as an affirmative defense at trial, the Court would not reverse the indictment.

The dissent, by Judge Simonelli, wrote that it is fundamentally unfair to prosecute and imprison an individual for engaging in activity protected under CEPA and NJLAD. She reasoned that the Legislature wished to encourage whistleblowing and that there is no way that Ms. Saavedra could have had fair warning that she could be prosecuting for participating in protected activity. The dissent also pointed out in a footnote that the New Jersey False Claims Act also encourages employees to disclose confidential information, which the majority had now ruled could subject an employee to criminal prosecution.

This decision is extremely disturbing because it means that attorneys representing conscientious employees will now need to advise those clients that it is difficult to win these cases without evidence, but if the employee takes or copies evidence, while the employee is protected under civil statutes, they could still be criminally prosecuted. This case will undoubtedly chill employees from bringing legitimate claims against their employers, and ultimately will scare would-be whistleblowers, allowing employers to engage in unlawful actions with impunity while prosecuting conscientious employees who try to report them. I doubt that is what the Legislature intended, and they will now have to deal with issue, if it is not first resolved by the Supreme Court.

Because this case was taken on an interlocutory appeal, there is not an appeal as of right to the Supreme Court, even though there was a dissent. Saavedra’s criminal attorney intends to file a motion to the New Jersey Supreme Court, and he will probably be joined by amici. Hopefully, the Supreme Court will be willing to address the serious public policy concerns regarding protection of whistleblowers and announce a bright-line rule. Most likely, however, there will be a ruling specific to this case and encouragement for the Legislature to act. In the meantime, attorneys need to be extremely careful and make sure that clients are given proper warning.

Criminal defense counsel/Appellant: Mario M. Blanch.

Counsel for Respondent: Leo Hernandez, Special Deputy Attorney General/Acting Assistant Prosecutor; Gaetano T. Gregory, Acting Hudson County Prosecutor.

Trial Judge: Lisa Rose, J.S.C. - Hudson County.

Appellate Division Judges: Hon. Douglas M. Fasciale (For the majority); Hon. Jose L. Fuentes; Hon. Marie P. Simonelli (dissenting).

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