NEW JERSEY SUPREME COURT EXPANDS EMPLOYER LIABILITY IN “WATCHDOG” EMPLOYEE WHISTLEBLOWER CASE

Earlier this month, the New Jersey Supreme Court ruled in Lippman v. Ethicon that workers whose job entails monitoring whether their employers are complying with certain rules, regulations and standards, sometimes called “watchdog” employees, are entitled to whistleblower protection under the Conscientious Employee Protection Act  (“CEPA”).  CEPA is a comprehensive state law that protects employees from retaliation for reporting illegal activities or other activities that otherwise threaten the public’s safety, health or welfare or the environment.

In Lippman, Chief Medical Officer, Dr. Joel Lippman, brought suit against his former employer, Ethicon, a subsidiary of Johnson and Johnson, for retaliation for firing him for allegedly making complaints about certain drugs and medical devices and supporting recalls of dangerous products.  The Company argued that since raising these issues were part of Dr. Lippman’s “ordinary job responsibilities,” he could not show that he engaged in a “whistleblowing activity,” and therefore, he should not be protected under CEPA.    The trial court previously ruled in favor of Ethicon.  The Appellate Division reversed but ruled that watchdog employees, like Lippman, must exhaust all internal complaint processes before they can make a CEPA claim.  The New Jersey Supreme Court unanimously held that the plain language of the statute did not require an extra exhaustion requirement, and stated that watchdog employees are vulnerable to retaliation and state law “does not limit protection based on job title or function.”

This Firm will continue to monitor the developments in this case.

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