Mehlman v. Mobil Oil Corp.
707 A.2d 1000, 13 I.E.R. Cas. (BNA) 1441, 153 N.J. 163 (1998)
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Rule of Law:
New Jersey's Conscientious Employee Protection Act (CEPA) protects a New Jersey employee from retaliatory discharge for objecting to an employer's practice that the employee reasonably believes is incompatible with a clear mandate of public policy concerning public health, even if the harmful practice occurs outside of New Jersey and affects non-citizens.
Facts:
- Dr. Myron A. Mehlman was Mobil Oil Corporation's Director of Toxicology, an expert on the health hazards of chemicals with responsibilities of an international scope.
- In September 1989, while giving a presentation on gasoline health hazards to managers at Mobil's Japanese subsidiary, MSKK, Mehlman was informed by MSKK's technical manager, Takashi Tsunemori, that the benzene level in MSKK's regular gasoline was 5.7 or 5.8 percent.
- Mehlman, knowing benzene to be a dangerous carcinogen, immediately responded that the concentration was dangerously high, insisted it be reduced, and told the managers, 'You reduce it or do not sell it.'
- Mehlman stated that MSKK's equipment was old and it would cost several hundred million dollars to upgrade the refinery to produce low-benzene gasoline.
- Shortly after returning to New Jersey from Japan on October 7, 1989, Mehlman's superior, Anthony Silvestri, informed him he was being placed on indefinite special assignment due to a pending investigation.
- Mobil's investigation, which it claimed was initiated before Mehlman's trip to Japan, concerned allegations that Mehlman was misusing company assets for his wife's publishing business.
- On November 2, 1989, Mobil terminated Mehlman's employment for cause, based on the findings of its internal investigation.
- Mehlman asserted that he used Mobil's resources with his prior supervisor's consent because his wife's publishing activities benefitted Mobil's reputation in the scientific community.
Procedural Posture:
- Dr. Myron A. Mehlman sued Mobil Oil Corporation in a New Jersey trial court, alleging a violation of the Conscientious Employee Protection Act (CEPA).
- A jury returned a verdict in favor of Mehlman, awarding him $3,440,300 in compensatory damages and $3,500,000 in punitive damages.
- The trial court judge granted Mobil's motion for a judgment notwithstanding the verdict, concluding that Mehlman had failed to prove the existence of a clear mandate of public policy.
- Mehlman appealed to the Appellate Division, which is an intermediate appellate court.
- The Appellate Division reversed the trial court's judgment and reinstated the jury's verdict and damage awards.
- Mobil then appealed to the Supreme Court of New Jersey, the state's highest court.
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Issue:
Does New Jersey's Conscientious Employee Protection Act (CEPA) protect a New Jersey-based employee from retaliatory discharge after he objected to his employer's subsidiary's practice in Japan, which he reasonably believed violated a clear mandate of public policy concerning public health by endangering Japanese citizens?
Opinions:
Majority - Stein, J.
Yes. The Conscientious Employee Protection Act (CEPA) protects a New Jersey employee from retaliatory action for objecting to a practice that harms the public health of citizens of another country. The core wrongful conduct under CEPA is the employer's retaliation, and the Act's protections are not limited by geography. The court, not the jury, must determine as a matter of law whether a 'clear mandate of public policy' exists. In this case, such a mandate was established through a combination of sources, including a Japanese Petroleum Association guideline limiting benzene to 5%, persuasive scientific evidence of benzene's carcinogenicity, and Japanese environmental regulations. An employee does not need specific knowledge of the precise source of public policy at the time of their objection; they need only an objectively reasonable belief that the employer's activity is harmful to public health and likely incompatible with a recognized source of public policy.
Dissenting - O'Hern, J.
No. The majority incorrectly found a 'clear mandate of public policy' and the case should be retried due to a fatally flawed jury instruction. The identification of a clear mandate of public policy is a judicial function, yet the trial court improperly delegated this question to the jury. The majority errs by elevating a private industry group's guideline (the Japanese Petroleum Association) to the status of public policy, which should be grounded in sources with the effect of law, such as statutes or regulations. This decision improperly exports New Jersey public policy and applies it extraterritorially to conduct in Japan, where public policy on benzene levels was still evolving in 1989 and not clearly established.
Analysis:
This decision significantly broadens the geographic scope of New Jersey's Conscientious Employee Protection Act (CEPA), establishing that its protections are not parochial. It confirms that a New Jersey employer can be held liable for firing an employee who 'blows the whistle' on conduct that endangers public health anywhere in the world. The ruling also provides a flexible definition of a 'clear mandate of public policy,' allowing it to be established by non-governmental sources like foreign industry guidelines when they reflect a scientific consensus on public harm. Finally, it lowers the burden on the whistleblower, requiring only an objectively reasonable belief of a policy violation, not specific knowledge of the legal source, thereby encouraging employees to report perceived dangers without fear of needing to be a legal expert.
