Employee Wrongfully Terminated for Refusing to Engage in Criminal Copyright Infringement

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Adam Young worked for an architecture firm, Nortex Foundation Designs Inc. in Fort Worth Texas as a drafter. He was hired in 2001 and designed foundation plans based on copyrighted architectural designs that Nortex provided to him. In 2010, Young received a plan being drafted for a homeowner that had a black stamp which stated “If this stamp is not red it is an illegal set of plans . . . Reproduction of these plans by any means is prohibited by federal law.” Young informed his supervisor that he did not feel comfortable working on the plans due to the black stamp. His supervisor, in turn, informed him that if he did not work on the plans, he would be fired. Young refused to work on the plans and was terminated. He subsequently filed a claim for wrongful termination.

At the jury trial, Nortex argued that it never asked Young to commit any illegal acts because the homeowner who the plans were being drafted for had purchased the architectural plans and had a red-stamped copy of the plans. Young argued that nobody at Nortex informed him that the homeowner had red-stamped plans. Young was thus under the impression that he was being asked to perform an illegal act. The jury found in Young’s favor and awarded him damages in excess of $300,000. Nortex filed a motion for judgment notwithstanding the verdict, arguing that because the homeowner had the original designs, all copies were authorized and therefore it did not ask Young to perform an illegal act. The district court agreed with Nortex and granted the motion. Young then appealed to the Texas Court of Appeals.

Texas is an employment-at-will state, meaning that either party may terminate an employment relationship at any time with or without cause. The Texas Supreme Court has recognized a narrow exception to the at-will policy in a 1985 decision, Sabine Pilot Service Inc. v. Hauck. In Sabine, the court carved out a narrow exception to the at-will doctrine by holding that, for public policy reasons, an employer cannot fire an employee if that employee refuses to perform an illegal act. The court reasoned that an employee should not be forced to choose between losing employment or facing potential criminal liability.

The court of appeals determined that Young would have been exposed to liability for criminal copyright infringement if he had worked on the black-stamped plans. Even if Nortex could have raised an affirmative defense to any charges of criminal copyright infringement, that did not change the fact that “Nortex asked Young to commit a crime by using a black-stamped copy, refused to provide him with the legal red-stamped copy, and fired him when he would not use the unlicensed copy.” Thus, because Young was asked to perform an illegal act, the jury properly applied the Sabine Pilot exception. The court reversed the judgment notwithstanding the verdict and entered judgment in favor of Young.

Topics:  At-Will Employment, Copyright, Damages, Hiring & Firing, Infringement, Termination

Published In: Civil Procedure Updates, Construction Updates, Criminal Law Updates, Intellectual Property Updates, Labor & Employment Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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