In a recent case, the Second District Court of Appeals Division 5 in California issued an opinion in an appeal involving a termination dispute between an employer and an employee. The employer, Phonexa Holdings, hired the employee, the former chief marketing officer, a few months prior to firing her after she raised concerns about the company’s compliance with COVID-19 public health measures. Following the termination, Phonexa filed a lawsuit claiming that the former employee and her husband stole proprietary information from the company. The former employee filed a cross-complaint asserting various employment claims, and both sides filed anti-SLAPP motions to strike the other’s lawsuits. The appeals court decision resolved the appeal from the trial court’s order denying Phonexa’s anti-SLAPP motion, with the appeals court ultimately denying the appeal, affirming the lower court’s decision to deny Phonexa’s anti-SLAPP motion.
Facts of the Case
Phonexa sued the former employee in August of 2020, alleging that her relationship with senior management at the company deteriorated after she took two days off of work starting on July 20, 2020, and copied the hard drive of her work computer onto a series of personal drives. Phonexa alleges that she copied the electronic materials at the direction of an executive at a competing company in order to steal Phonexa’s trade secrets. The former employee filed a cross-complaint asserting multiple employment claims, including that Phonexa’s chief executive officer (CEO) questioned and interrogated employees who were working from home and made statements that COVID-19 was a hoax and an attempt to disrupt the 2020 presidential election, among other claims. When the former employee shared concerns regarding the return to work policy with human resources in May 2020, the CEO demanded the complaining employees’ names and threatened retaliation.
The former employee worked from home for the duration of her time at Phonexa after advising them that she suffers from a preexisting medical condition that required her to be cautious about contracting COVID-19. Despite this, the CEO asked her numerous times when she planned to work from the office. During a phone call on July 20, 2020, the CEO berated and belittled her, and two days after the call when she submitted a formal written complaint about the company policy, the former employee was terminated.
The Court’s Decision
The appeals court opinion addresses Phonexa’s anti-SLAPP motion, stating that litigation of an anti-SLAPP motion involves a two-step process. (1) The moving defendant bears the burden of establishing the challenged allegations or claims arising from protected activity in which the defendant has engaged, and (2), for each claim that does arise from protected activity, the plaintiff must show the claim has at least minimal merit. If the plaintiff cannot make this showing, the court will strike the claim.” Here, the appellate court establishes that the employee’s lawsuit does not seek any recovery predicated in whole or part on Phonexa’s lawsuit and that her claims do not arise from the CEO’s statements regarding the public response to COVID-19. As a result, the order denying Phonexa’s special motion to strike is affirmed.
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