Louisiana Record

Tuesday, October 22, 2019

Federal appeals court favors whistle-blowers by enhancing definition of 'good faith

By Kacie Whaley | Jul 14, 2017

| pixabay.com

NEW ORLEANS — In a recent whistle-blower case, the U.S Court of Appeals for the Fifth Circuit broadened the Louisiana Environmental Whistle-Blower Act's definition of "good faith" to the benefit of the plaintiff.

The decision was a reaction to a district court judgement on the Borcik v. Crosby Tugs, L.L.C. case, where a deckhand for a Crosby Tugs vessel claimed his captain instructed him to dump waste oil into navigable water for three years, according to energy law firm Liskow & Lewis. The employee alleged that he followed orders but eventually reported the captain to the company's chief administrative officer. He was then fired and later sued Crosby on allegations that the company violated the Louisiana Environmental Whistle-Blower Act.

The state's whistle-blower law says that an employer cannot "act in a retaliatory manner against an employee acting in good faith" who reports or threatens to report a violation of an environmental law. It also entails that a successful whistle-blower may receive “triple damages resulting from the action taken against him.”

The United States District Court for the Eastern District of Louisiana told the jury involved in the Borcik case that in order for the plaintiff to show that his actions were made in good faith, there must be “an honest belief that an environmental violation occurred, and that he did not report it either to seek an unfair advantage or to try to harm his employer or another employee.” When the case was brought to the Fifth Circuit, the appeals court asked the Louisiana Supreme Court to define the whistle-blower act's meaning of "good faith."

The supreme court's definition of "good faith," which was broader than that of the district court's, “promotes the purpose of the LEQA [Louisiana Environmental Quality Act] and balances competing interests of the state and the environment, employers and industry, and employees by encouraging reporting of environmental violations and protecting employers from potential whistle-blowers who are not operating in good faith.”

"The Louisiana court merely asked whether the interpretation asked for by the employer comported with the purpose of the act. The answer was no," Gerald Torres, an environmental law professor at Cornell Law School, told the Louisiana Record. "The purpose of the act was to protect employees who had a good faith belief that environmental laws were being violated and to lead to a better enforcement of the environmental laws of the state."

On June 1, the appeals court adopted the supreme court's definition and maintained that the district court was wrong for telling the jury that good faith "required more than ‘an honest belief that a violation of an environmental law, rule or regulation occurred.’”

"This court decision may lead employers to police the managers who are putting the company at risk," Torres said.

Torres asserted that the outcome of the Borcik case could lead to "better environmental outcomes and reduce potential liability" for companies.

"It will undoubtedly lead to employers thinking twice about terminating an employee who is within the protection of the Whistle-Blower Act," Torres said.

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Louisiana Supreme Court U.S. Court of Appeals for the 5th Circuit