The U.S. District Court for the District of New Jersey recently ruled that an employee could bring a defamation claim against his former employer and several of his former coworkers based on rumors they allegedly spread about the reason for his termination.
“David” began working for Carriage Services, d/b/a Samuel Funeral Home, as a funeral director in 2013. In 2015, he was diagnosed with cancer. He claims that as part of his treatment for cancer, his doctors prescribed medical marijuana pursuant to the New Jersey Compassionate Use of Medical Marijuana Act. He says that he uses marijuana only at night and has never been under its influence while at work.
In 2016, through no fault of his own, David was involved in a car accident in the course of his employment. After the accident, an ambulance took him to the emergency room, where he disclosed his marijuana prescription when he provided his medical history. He claims he wasn’t under the influence of marijuana at the time of the accident, but his marijuana prescription was disclosed to Carriage Services during a discussion of work-related injuries he suffered in the accident.
David provided proof of his marijuana prescription to Carriage Services. The company then required him to take a drug test and terminated his employment based on a violation of its drug and alcohol policy, which requires employees to inform their supervisor if they are taking any medication that may adversely affect their ability to perform their assigned duties safely. David denies that his marijuana use affected his ability to perform his assigned duties because he used marijuana only at night and he performed his duties without issue.
David alleges that Carriage Services employees informed members of the Bergen County Funeral Directors Association that his employment was terminated because he is a drug addict who was under the influence of drugs at the time of his car accident. He further alleges that those statements were false and harmed his ability to obtain new employment.
David sued Carriage Services in the Superior Court of New Jersey, asserting claims for violation of the New Jersey Law Against Discrimination (NJLAD) and defamation. Carriage Services had the case transferred to the U.S. District Court for the District of New Jersey and asked that it be dismissed.
David then sought to add several Carriage Services employees as defendants to the defamation claim and to assert additional claims, including one for intentional interference with prospective economic advantage. Carriage Services opposed his attempt to amend the complaint, arguing the proposed amendments would be futile.
District Court’s Decision
David sought to add a defamation claim against Carriage Services employees “Samuel” and “Missy.” To establish a claim for defamation under New Jersey law, a person must provide proof of (1) a false and defamatory statement about him, (2) the unprivileged publication of that statement to a third party, (3) fault amounting to at least negligence, and (4) damages.
Carriage Services argued that David’s proposed defamation claim against Samuel and Missy would be futile because he hadn’t identified who made the allegedly defamatory statements or the people to whom those statements allegedly were published.
In support of his proposed defamation claim, David alleges that Samuel, his supervisor, learned of his medical marijuana use when his father brought a copy of his marijuana prescription and license to the funeral home after his car accident. David’s father told Samuel that the emergency room doctor who treated him didn’t believe that he was under the influence of drugs but declined to subject him to a blood test because he knew it would come back positive in light of his medical marijuana use.
David says that he nevertheless underwent a urine and Breathalyzer® test at Samuel’s insistence. The next day, he spoke to Samuel about his medical marijuana prescription and use, stressing that he used the drug only after work. Several days later, Samuel called him and told him that he was being terminated because drugs were found in his system.
David alleges that his mother received a phone call from an employee of another funeral home, who said that someone at Samuel Funeral Home had informed her that David was fired because he is a drug addict. She also said that many people at a meeting of the Bergen County Funeral Directors Association were discussing rumors that David was fired because he used drugs at work, he was under the influence of drugs when his car accident occurred, and the accident happened because he was on drugs.
David claims that Samuel and Missy falsely spread those rumors to members of the funeral directors association. He also alleges that the rumors harmed his reputation and interfered with his efforts to obtain new employment when he applied for jobs with other funeral homes, which denied his applications because they believed he was a drug addict.
The court concluded that David provided sufficient facts to establish a defamation claim against Samuel and Missy, and it granted him permission to amend his complaint to add the individual defendants. The court also permitted him to add a claim for tortious (wrongful) interference with prospective economic advantage against Carriage Services, Samuel, and Missy based on the same factual allegations.
This case highlights the importance of maintaining the confidentiality of employees’ medical information as well as the potential dangers of discussing employee discipline or terminations with people outside the organization. As a matter of course, any discussions about such information should be limited to the people within your organization who have a legitimate business reason to know it.
Howard Fetner is a contributor to the New Jersey Employment Law Letter.