On April 20, the Texas Supreme Court held 9-0 in Safeshred Inc. v. Martinez that a plaintiff in a Sabine Pilot case (where an employee is terminated for refusing to perform an act that would land him in jail) can recover punitive damages; however the plaintiff in Safeshred did not establish sufficient evidence to recover punitive damages. In doing so, the court reversed the Austin court of appeals' decision to let the plaintiff keep the punitive damages award.
So, is all well in Corporate Texas? In its holding in Safeshred, the court went out of its way to broadly discuss what does or does not constitute sufficent evidence of punitive damages in employment cases, not just Sabine Pilot cases. And the court reaffirmed the old standby that in a retaliation case, the plaintiff -- to establish the necessary malice for a finding of punitive damages -- must show more than the "mere intent" to fire an employee, or else every jury's finding of retaliation would warrant punitive damages.
But in Footnote 6, the court said that malice could be established if an employer, when firing the employee, was aware that the law does not permit employers to fire employees for refusing to perform illegal acts. What? So, now an educated employer, one who understands what the law prohibits, won't be able to wiggle out of a punitive damages award simply because it knows the law. It will be punished for wisdom, and insulated for its ignorance.
Because there is no reason not to apply Footnote 6 to other types of retaliation claims, the court has opened the door to a new reality show: "Punitive Damages Gone Wild." I think perhaps the court meant to say that there must be evidence that the employer thought: 1. We know we are terminating the employee in violation of the law and 2. we are going to do so anyway. But that is not what the Safeshred opinion says.