Banaitis v. Mitsubishi Bank, Ltd.

• Decision Date: 03 August 1994
• Parties: , 9 IER Cases 1481 Sigitas BANAITIS, Respondent--Cross-Appellant, v. MITSUBISHI BANK, LTD., and Bank of California, N.A., Appellants--Cross-Respondents, and Karen LESH, Defendant. A8912-07357; CA A70113.
• Court: Oregon Court of Appeals

Page 1288

879 P.2d 1288

129 Or.App. 371, 9 IER Cases 1481

Sigitas BANAITIS, Respondent--Cross-Appellant, v. MITSUBISHI BANK, LTD., and Bank of California, N.A.,

Appellants--Cross-Respondents,

and

Karen LESH, Defendant.

A8912-07357; CA A70113.

Court of Appeals of Oregon.

Argued and Submitted July 28, 1993.

Decided Aug. 3, 1994.

[129 Or.App. 372-C] James N. Westwood, Portland, argued the cause, for appellants--cross-respondents. With him on the briefs were Black Helterline, Michael O. Moran and Miller, Nash, Wiener, Hager & Carlsen.

Charles J. Merten and John Paul Graff, Portland, argued the cause, for respondent--cross-appellant. With them on the briefs were Merten & Associates, Graff & O'Neil and Glen H. Downs.

Before WARREN, P.J., and EDMONDS and LANDAU, JJ.

LANDAU, Judge.

Defendants appeal from a judgment awarding plaintiff compensatory damages on his claim for wrongful discharge against defendant The Bank of California, N.A. (BanCal), and on his claim for interference with a contractual relationship against defendant Mitsubishi Bank, Ltd. (MBL). Plaintiff cross-appeals a judgment notwithstanding the verdict that deprived him of a jury award of punitive damages against both defendants. ¹ We affirm on the appeal and reverse on the cross-appeal.

We state the facts in the light most favorable to plaintiff. Plaintiff, a former vice president of BanCal, began working for the bank in 1980. MBL is a financial institution in the "Mitsubishi Group," a collection of related companies in Japan. In 1984, MBL acquired directly 13 percent of the stock in BanCal. It then acquired a holding company that held the balance of BanCal's stock. MBL transferred a number of its officers from Tokyo to manage the bank. One of those officers, Tanaka, remained an MBL employee, but was given a title at BanCal. Tanaka was plaintiff's supervisor from late 1986 until plaintiff's termination.

BanCal had a policy of keeping its customers' financial information confidential. It stated that policy in its employee policy manual, and each year employees were required to certify that they understood the policy. An employee who breached the confidentiality policy was subject to immediate dismissal.

When MBL acquired BanCal, a number of BanCal's customers expressed concern that MBL would acquire information from BanCal that would be used by other members of the Mitsubishi Group for competitive advantage. Some customers stopped doing business with BanCal. Others demanded written confidentiality agreements that would insure that their financial information would not be disclosed to MBL.

In the fall of 1986, an employee of MBL telephoned plaintiff and asked him to supply a "comparison chart on [BanCal's] grain company customers." The comparison chart that MBL requested contains information that shows the relative financial positions of five large grain shippers, including each company's cash on hand, accounts receivable, inventory of grain, accounts and notes payable, long-term indebtedness, net worth, cost of goods, operating expenses, profit and inventory turnover. Knowledge of that information would give a competitor an advantage in the marketplace. Plaintiff refused the MBL employee's request for the chart, explaining that disclosure of the information was against bank policy, against the law and unethical. When the MBL employee explained that he sought the information for MBL's internal use only, plaintiff responded that he would not release the information without written authorization from the bank's president.

In September, 1986, the manager of MBL's Portland office made a similar request of plaintiff, this time asking for confidential financial information about a particular customer, Schnitzer Steel Industries, Inc. (Schnitzer). Schnitzer was one of the BanCal customers that had demanded express promises from BanCal that confidential information would not be disclosed to MBL or any member of the Mitsubishi Group. Plaintiff again refused MBL's request.

Soon after that, in February, 1987, Tanaka wrote a performance evaluation that falsely accused plaintiff of not meeting his 1986 budget. In June, 1987, Tanaka falsely accused plaintiff of going to New York on business without approval. Tanaka also accused plaintiff of being dishonest and questioned his integrity. In August, 1987, BanCal put plaintiff on probation for 90 days, based on another evaluation that reiterated the earlier falsehoods and added new false charges.

Plaintiff's probation was over in mid-November, but BanCal did not dismiss him. Meanwhile, plaintiff informed BanCal's Human Resources Department that he could not stay at the bank and offered to negotiate a smooth departure. On December 16, while negotiations continued, plaintiff told his staff at a breakfast meeting that he would be leaving the bank soon. He had anticipated that he would continue to work at least through December 31, 1987, so that he would receive the full value of the bank's contributions to his pension fund for 1987. However, Tanaka and BanCal's Human Resources Department accelerated his departure date to December 30, 1987, thus depriving him of those pension benefits. Plaintiff received notice of that decision in a letter hand-delivered by Tanaka. Plaintiff then was instructed that he had 30 minutes to "clean out his desk." He protested that he could not possibly complete the task that quickly, so he was allowed to remove his things the next day after working hours. Other employees were instructed to watch him while he packed.

Plaintiff commenced this action on December 12, 1989. He alleged a claim against BanCal for wrongful discharge and a claim against MBL for interference with a contractual relationship. The complaint included demands for punitive damages against both defendants.

At the close of the evidence at trial, defendants moved for directed verdicts on both claims. The trial court denied the motions, and the jury returned a verdict for plaintiff, awarding plaintiff compensatory and punitive damages against both defendants. Defendants then moved for a judgment notwithstanding the verdict or, in the alternative, for a new trial. The trial court denied that motion with respect to the verdict for compensatory damages. It granted the motion with respect to punitive damages on both claims, and it denied the alternative motion for a new trial.

In the first assignment of error, BanCal contends that the trial court erred in denying its motion for directed verdict, because plaintiff failed to produce evidence of a prima facie case for wrongful termination. BanCal concedes, for the purpose of the motion, that it deliberately made plaintiff's working environment so unpleasant that he had to leave, and that it did so in retaliation for his withholding BanCal's confidential customer information from MBL. According to BanCal, that does not constitute wrongful termination because plaintiff was an at-will employee, and the reason for his discharge does not fall within any exception to the general rule that at-will employees may be discharged at any time, for any reason.

In reviewing the denial of the motion for directed verdict, we consider the evidence, including the inferences, in the light most favorable to the nonmoving party, and the verdict cannot be set aside "unless we can affirmatively say that there is no evidence from which the jury could have found the facts necessary" to support the verdict. Brown v. J.C. Penney Co., 297 Or. 695, 705, 688 P.2d 811 (1984); see also Hirsovescu v. Shangri-La Corp., 113 Or.App. 145, 147, 831 P.2d 73 (1992).

In general, an employer may discharge an employee at any time, for any reason, unless doing so violates a contractual, statutory or constitutional requirement. Patton v. J.C. Penney Co., 301 Or. 117, 120, 719 P.2d 854 (1986). There are exceptions to the general rule. A cause of action will lie against an employer who discharges an employee for performing a public duty, or fulfilling a societal obligation such as serving on a jury, Nees v. Hocks, 272 Or. 210, 219, 536 P.2d 512 (1975), or refusing to commit a potentially tortious act of defamation. Delaney v. Taco Time Int'l., 297 Or. 10, 17, 681 P.2d 114 (1984). An employer also may be held liable for discharging an employee for pursuing private statutory rights that are directly related to the employment, such as resisting sexual harassment by a supervisor, Holien v. Sears, Roebuck and Co., 298 Or. 76, 90-97, 689 P.2d 1292 (1984), or filing a claim for workers' compensation benefits. Brown v. Transcon Lines, 284 Or. 597, 588 P.2d 1087 (1978).

In this case, plaintiff contends that his termination for refusing to disclose confidential information falls within the "societal obligation" or "public duty" exception to the at-will rule. According to plaintiff, there is a public duty to avoid disclosing valuable, confidential customer financial information held by a bank. That public duty, he argues, is evidenced by a host of state and federal statutes that generally protect business information from discovery by or disclosure to the public or to government agencies. In particular, plaintiff relies on federal and state public records statutes, rules of civil procedure and various criminal statutes, all of which protect against disclosure of confidential financial information.

BanCal argues that plaintiff's refusal to divulge the requested information implicates no societal obligation or public duty. It argues that none of the statutes on which plaintiff relies specifically applies to the disclosure of customer financial information held by a bank. Without such statutes, "carefully tethered" to the specific conduct at issue, BanCal contends, there can be no societal obligation or public duty.

We first address the parties' arguments concerning the standard that we must apply in determining whether a societal obligation or public duty is implicated. In deciding the question whether an employer...