In Sergeant First Class Frank Chiofalo v. State (A-30-18/081607) (Decided July 16, 2019), the Supreme Court of New Jersey sided with state trooper who alleges that he faced retaliation in the wake of the Death Race 2012 scandal. In doing so, the court made it clear that whistleblowers seeking to rely on the state’s Conscientious Employee Protection Act (CEPA) should not face an uphill battle.
Conscientious Employee Protection Act
As the court explained in D’Annunzio v. Prudential Ins. Co. of Am., 192 N.J. 110, 120 (2007), CEPA ensures that employees are “protected from retaliation and employers are deterred from activities that are illegal or fraudulent, or otherwise contrary to a clear mandate of public policy.” CEPA is a remedial statute, and as such it “should be construed liberally to effectuate its important social goal.” Battaglia v. United Parcel Serv., Inc., 214 N.J. 518, 555 (2013).
N.J.S.A. 34:19-3(c)(2) protects employees who “[o]bject to, or refuse to participate in any activity, policy or practice which the employee reasonably believes . . . is fraudulent or criminal.” Meanwhile, Subsections (c)(1) and (c)(3), respectively, protect employees who take similar action with regard to activities, policies, or practices they reasonably believe are “in violation of a law, or a rule or regulation promulgated pursuant to law” or are “incompatible with a clear mandate of public policy.”
In Dzwonar v. McDevitt, 177 N.J. 451, 461-69 (2003), the New Jersey Supreme Court summarized generally what a plaintiff must set forth to establish a prima facie case pursuant to N.J.S.A. 34:19-3(c):
(1) he or she reasonably believed that his or her employer’s conduct was violating either a law, rule, or regulation promulgated pursuant to law, or a clear mandate of public policy; (2) he or she performed a “whistle-blowing” activity described in N.J.S.A. 34:19- 3(c); (3) an adverse employment action was taken against him or her; and (4) a causal connection exists between the whistle-blowing activity and the adverse employment action.
The court further stated that either “the court or the plaintiff” must identify the statute, regulation, rule, or public policy that closely relates to the complained-of conduct. However, it also emphasized that a plaintiff need not “allege facts that, if true, actually would violate that statute, rule, or public policy.” Rather, a plaintiff is required only to “set forth facts that would support an objectively reasonable belief that a violation has occurred.”
Facts of Chiofalo v. State
Plaintiff Frank Chiofalo, a then-member of the New Jersey State Police (NJSP), filed a CEPA complaint against his employer and certain supervisors (collectively, defendants). As the Assistant Administrative Officer of Troop B of the NJSP, Chiofalo was required to log documents that came in and out of headquarters and to collect reports from the Troop B commander. Chiofalo alleges he faced retaliation for his engagement in protected activity related to two incidents.
The first pertained to a claimed refusal to destroy internal NJSP documents. On March 20, 2012, a sergeant and a trooper participated in an unsanctioned high-speed escort of collection of high-end sports cars on the Garden State Parkway, for which they later became subjects of internal review. A “letter of appreciation” from one of the escorted civilians extended thanks for the officers’ help (the Civilian Letter). On April 18, 2012, Major Edward Cetnar, Deputy Branch Commander of Field Operations, sent an internal memorandum (the Cetnar Memo) noting that the Civilian Letter had been included in the trooper’s personnel file and adding, “[p]lease convey to [the trooper] my appreciation for a job well done.” On April 23, 2012, the officers were suspended without pay pending investigation into the escort.
On Friday, April 27, 2012, the Civilian Letter and the Cetnar Memo were received by Chiofalo, who presented them the following Monday to Major Robert Cuomo, the commander of Troop B, and asked what to do with the documents. In his deposition, Chiofalo stated “[Cuomo] said ‘It does not exist,’” to which Chiofalo replied, [“I]t does exist I have it in my hand. . . . I’m not going to get rid of it.[”] According to Chiofalo, that exchange made it “pretty clear” to him that Cuomo was asking Chiofalo “to get rid of” the documents, and that in stating he was “not going to get rid” of the documents, he was refusing to participate in a criminal or fraudulent act.
Chiofalo claimed that the second protected activity occurred during an interaction with Cuomo in which he accused Cuomo of not reporting his vacation time. According to Chiofalo, Cuomo “questioned why [Chiofalo] was taking two weeks off in July.” In response, Chiofalo stated that “[he] earned [his] vacation time and when [he] take[s] it, they dock it out of [his] bank” and that “[he] take[s] [his] time, unlike others.” According to Chiofalo, when he stated “unlike others” he was referring to Cuomo and to his suspicion that Cuomo was not properly reporting all of the time that he took off.
Defendants filed a motion for summary judgment, alleging that Chiofalo failed to set forth a prima facie case under CEPA. The court denied the motion, and a jury later awarded Chiofalo $455,000 in compensatory and punitive damages. On appeal, the defendants argued that Chiofalo failed to identify a specific law or policy that prohibited Cuomo’s conduct. The Appellate Division agreed, holding that a CEPA plaintiff must first find and enunciate the specific terms of a statute or regulation, or the clear expression of public policy, which would be violated if the facts as alleged are true, which Chiofalo failed to do. “Chiofalo had failed to identify any law or regulation that he believed Cuomo violated in allegedly ordering Chiofalo to destroy documents,” the court stated. It further found that Chiofalo’s statement to Cuomo “was hardly ‘whistleblowing’ as contemplated by CEPA.” Based on the foregoing, the appeals vacated the judgment.
New Jersey Supreme Court’s Decision in Chiofalo v. State
The New Jersey Supreme Court affirmed in part and reversed in part. “We do not agree that the trial court erred in refusing to grant defendants summary judgment on one of plaintiff’s two bases for whistleblowing charges,” the court held.
The court first held that Chiofalo had stated a prima facie whistleblower claim under CEPA with respect to his allegations that he was instructed by a supervisor to destroy internal state police documents. While the court acknowledged that “the better practice in CEPA actions brought under (c)(2), or its similarly worded counterpart in (a)(2), surely is to identify the statutory or other basis for claiming objected-to behavior is criminal or fraudulent,” it noted that it was “aware of no case that requires plaintiff to precisely cite the statutory source of perceived criminal activity.”
The court went on to note that while “criminal” or “fraudulent” activity is often apparent and commonly recognizable, the parties and the court need to have a common understanding of the legal principle that the plaintiff reasonably believed was being violated to enable joinder. Accordingly, if a defendant questions the source of law relied on by the plaintiff, that source should be provided by the plaintiff.
“We do not expect whistleblower employees to be lawyers on the spot; once engaged in the legal process, and with the assistance of counsel or careful examination by the court, however, the legal underpinnings for claimed behavior that is perceived as criminal or fraudulent should be able to be teased out sufficiently for identification purposes,” the court clarified. “Indeed, we note that NELA (the National Employment Lawyers Association of New Jersey) had no difficulty identifying statutory and regulatory provisions that pertained in this matter.”
Applying these principles to the case, the court highlighted that at no point during the trial or post-trial motions did defendants argue that the CEPA claim was deficient for plaintiff’s failure to identify a specific law, rule, regulation or public policy that was violated by the alleged acts. “More specifically, defendants never asked for a criminal code citation to support a claim under (c)(2) or some legal citation to support the claim of fraud,” the court wrote. Therefore, the court held that it would be unfair to reassess the summary judgment record based on arguments that were not advanced and that relate to a point the parties appeared to take for granted — namely, that refusal to participate in the destruction of documents would support a CEPA claim if plaintiff reasonably believed that the destruction was ordered or occurred. The New Jersey Supreme Court went on to affirm the dismissal of Chiofalo’s claim with regard to his allegation that his troop commander had engaged in fraudulent timekeeping of his vacation time. “[W]e agree with the Appellate Division that Chiofalo’s alleged statement to Cuomo that ‘[he] take[s] [his] time, unlike others’ was simply too amorphous to constitute ‘whistleblowing’ as contemplated by CEPA.’”