Designer Skin LLC v. S & L Vitamins, Inc., et al.
Phil Thygeson v. U.S. Bancorp, et al.
2004 U.S. Dist. Lexis 18863 (D. Or. , Sept. 15, 2004)
Employee Has No Expectation Of Privacy In Emails Stored In Personal Folder On Company System
The Magistrate Judge recommended the dismissal of plaintiff employee's invasion of privacy claims, which arose out of his employer's review of both e-mails he had received and stored in a personal, non-password protected, folder on a company computer, as well as a list of websites the employee visited from his office computer. The Court held that employee had no reasonable expectation of privacy in the materials searched because the Company had explicit policies advising its employees that Company computer equipment could be monitored for any legitimate business purpose, including ascertaining whether the Company computer had been improperly used for personal reasons or to send offensive emails, as was allegedly the case here.
This claim arose in the context of a lawsuit arising out of the employee's termination for cause for "spending an inordinate amount of time on the internet during work hours" and downloading and storing on his office computer "sexually inappropriate material," which evidently consisted of nude pictures and sexually explicit jokes. The employee claimed that his termination for cause was motivated by a desire to deny him severance benefits in violation of 29 U.S.C. §1140 of ERISA. The Court held that issues of fact precluded an award of summary judgment dismissing this claim. The Court did not dismiss claims plaintiff asserted arising out of the Company's alleged wrongful denial of benefits, and failure to notify him of how to apply for such severance benefits. Such claims were dismissed, respectively, because of the employee's failure to appropriately exhaust available administrative remedies, and his failure to file a claim for such benefits in the proper manner. As these later claims are beyond the scope of the Internet Library they will not be addressed below. Instead, our analysis will focus solely on the dismissal of plaintiff's invasion of privacy claim.
Employee Terminated For Inappropriate Usage Of Company Computer
Plaintiff Phil Thygeson ("Thygeson") was employed as a regional manager by defendant US Bancorp Equipment Financing Inc. ("USBEF"). Defendant USBEF was, through various intermediaries, a wholly owned subsidiary of defendant US Bancorp. Thygeson's supervisor, Tim Evans ("Evans") received complaints concerning Thygeson's performance, and noticed him sleeping on the job. Evans also observed Thygeson frequently viewing his computer screen at work, and received reports from subordinates that Thygeson was sending e-mails with inappropriate attachments.
As a result, Evans asked USBEF personnel to ascertain the nature of Thygeson's internet activity over a period of time. An inspection was conducted of the Company's computer system, which revealed both the website addresses of the internet sites plaintiff had viewed over a 12 day period, as well as the contents of various emails Thygeson had stored on the Company's computer system in a 'personal folder.' This personal folder was not password protected. The e-mails in question contained nude pictures and sexually offensive jokes.
After consulting with a Human Resources employee, Evans decided to terminate Thygeson's employment for cause. This decision was based, in part, on Evan's conclusion, after reviewing the results of the investigation of Thygeson's internet usage, that Thygeson was spending approximately four hours a day visiting websites for personal purposes. It was also based on the advice of USBEF's Human Resources department, which advised both that the transmission of the emails at issue violated Company employment policies, and constituted a terminable offense.
As a result of his termination for cause, Thygeson was denied certain severance benefits he otherwise would have received if he had simply been terminated by defendants.
Company Computer Usage Policy Reserves Right To Monitor
Defendants had policies in place that advised employees to use Company computers "for company business only." Employees were further advised not to use Company computer resources to "access inappropriate internet sites" and "not [to] send emails which may be perceived as offensive …". Employees were also warned that the Company "reserves the right to monitor any employee's email and computer files for any legitimate business reason, including when there is a reasonable suspicion that employee use of this system violates…. a company policy… Examples include … emails containing sexual innuendo or off-color jokes …. or extensive or unauthorized use that violates Company policy."
Plaintiff claimed that defendants' conduct was improperly motivated by a desire to deny him severance benefits he otherwise would be due on termination. In support of this claim, plaintiff alleged that other employees who had engaged in similar misconduct had been given warnings in lieu of termination. He, on the other hand, was simply terminated. As a result, plaintiff commenced this action, seeking, inter alia, relief under 29 U.S.C. § 1140 as a result of defendants' alleged wrongful interference with his severance benefits. Plaintiff also claimed that defendants, by their actions in inspecting his personal folder and reviewing his computer usage, impermissibly invaded his right of privacy. As state above, it is beyond the scope of the Internet Library to discuss plaintiff's employment claims. For reasons explained more fully in the Court's decision, the Magistrate Judge recommend that plaintiff be allowed to pursue his §1140 claim, as issues of fact concerning the motivation for plaintiff's termination precluded a resolution of the issue of this time.
No Reasonable Expectation Of Privacy
The Court did, however, recommend the dismissal of plaintiff's invasion of privacy claim. Plaintiff asserted a claim for intrusion upon seclusion. As explained by the Court:
The Court held that Thygeson's claim failed because he had no reasonable expectation of privacy in either the 'personal folder' in which he stored the subject emails, or his history of internet usage. Such result was mandated both by the Company policies defendants had in place, which apprised employees of the Company's right to monitor their usage and computer files, as well as by the fact that the Company could access such files on its own, without obtaining a password from Thygeson. Said the Court:
The Court's result addressed emails originally sent both over the Company's email system, as well as from Thygeson's personal Netscape email account. Provided they were stored on the Company's network, Thygeson had no reasonable expectation of privacy in the contents of his 'personal folder,' whatever their original source.
The Court noted the result might be different if defendants had attempted to obtain emails sent from Thygeson's personal email account over the Company's email system. However, as that was not the case at bar, the Court recommended the dismissal of Thygeson's right of privacy claims.