This case involves an issue of first impression: Whether an employer’s violation of Labor Code section 432.2―governing in part the right of a private employee to refuse to submit to a polygraph, lie detector or similar test as a condition of continued employment―supports a claim for wrongful discharge in violation of public policy. In this case, the jury found defendant Kavry Management, LLC (Kavry) required plaintiff Steven McDoniel to take a polygraph examination, after Kavry experienced a theft of cash and marijuana from its licensed marijuana-growing facility where McDoniel worked, then fired him after the polygrapher determined he had “failed” the test. The jury awarded McDoniel $100,000 in noneconomic damages.
On appeal, Kavry maintains section 432.2 cannot support a claim for the tort of wrongful discharge because its violation does not implicate a fundamental policy that affects the public or a large class of persons. It instead claims McDoniel’s damages, if any, should be limited to his taking of the polygraph examination itself, without regard to any effect the results of that examination had on his employment status. Kavry also maintains the court erred in awarding McDoniel attorney fees of about $212,000 under section 432.6, claiming this statute applies to employment contracts entered into on or after January 1, 2020, which would exclude McDoniel because his employment at Kavry ended in September 2018.
In his cross-appeal, McDoniel contends that, to the extent the trial court improperly based the attorney fees award on section 432.6, it erred by not separately awarding him fees under the private attorney general fee statute (Code Civ. Proc., § 1021.5) or the Private Attorneys General Act of 2004 (Lab. Code, §§ 2698, 2699, subd. (k)(1); PAGA). He also contends the court erred when it initially added Kavry’s then owner and manager, Chris Shepard, to the judgment, then vacated that judgment on its own motion and entered a new judgment against only Kavry.
As we explain, we conclude that McDoniel stated a valid cause of action for wrongful discharge based on Kavry’s violation of section 432.2; and that as a result, the jury properly awarded him noneconomic damages of $100,000.
We further conclude (1) the trial court erred when it based its attorney fees award on section 432.6; (2) the court properly exercised its discretion when it denied McDoniel fees under the private attorney general fee statute; and (3) McDoniel forfeited on appeal his claim for an award of fees under PAGA.
Finally, on this record we decline to decide whether Shepard should be added to the judgment against Kavry, as McDoniel contends in his cross-appeal. McDoniel filed a motion to amend the judgment to include Shepard as the alter ego of Kavry about six months after entry of the judgment, and about a year after McDoniel filed his first cross-appeal in this case. (See footnote 3, item 3 post.) In addition, McDoniel further claims in his request for judicial notice (ibid.) that “judicial estoppel” precludes Shepard and Kavry from arguing that Shepard is not liable for the judgment, after McDoniel―postjudgment―unsuccessfully sought to intervene in an unrelated, third-party action brought by Shepard. Because this issue primarily involves events and contested factual matters arising postjudgment that have yet to be resolved by the trial court, we are unable to decide it in this proceeding.
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