This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2002).
STATE OF MINNESOTA
IN COURT OF APPEALS
Theodore J. Chalupsky,
Dobbs Temporary Services,
d/b/a Pro Staff Personnel, Inc.,
Filed January 14, 2003
Toussaint, Chief Judge
Hennepin County District Court
File No. CT0111946
Thomas A. Foster, Thomas A. Foster & Associates, Ltd., 1840 IDS Center, 80 South Eighth Street, Minneapolis MN 55402 (for appellant)
Peter J. Gleekel, Kristin R. Eads, Winthrop & Weinstine, P.A., 3200 Minnesota World Trade Center, 30 East Seventh Street, St. Paul, MN 55101 (for respondent)
Considered and decided by Toussaint, Chief Judge, Willis, Judge, and Halbrooks, Judge.
TOUSSAINT, Chief Judge
Appellant argues that the district court erred in granting summary judgment to respondent on a claim of wrongful termination of employment. Because appellant’s employment agreement prohibited the disclosure of confidential information, and because appellant divulged such information to a third party when it was not reasonably necessary in the performance of his duties, we affirm.
In 1999, appellant Theodore Chalupsky entered into an employment agreement with respondent Pro Staff Personnel, Inc. Chalupsky had management responsibility over several of Pro Staff’s markets, and his duties included “hiring of managerial and other key employees” and “developing and implementing Accounting Business Plans and strategies.” Pro Staff’s accounting business plan contains confidential and proprietary information relating to its accounting and finance division. The employment agreement listed as confidential information the following items:
material, records, data and information not generally available to the public regarding Company, its customers and affiliates, including, but not limited to, * * * business policies, financial information, * * * or any other confidential or secret information concerning the business and affairs of Company or its affiliates.
(Emphasis added). The same section sets forth the requirements for Chalupsky’s use and disclosure of Pro Staff’s confidential information:
Employee shall hold in confidence and not directly or indirectly disclose, use, copy or make lists of any such Confidential Information, except to the extent authorized in writing by Company, * * * or as otherwise is reasonably necessary or appropriate in connection with the performance by Employee of Employee’s duties pursuant to this Agreement.
On February 21, 2000, Chalupsky sent Pro Staff’s accounting business plan as an attachment to an e-mail message to his brother, Mathew Chalupsky (Mathew). Chalupsky included the following message in the e-mail: “Matt—please review.” At the time, Mathew was a corporate manager for Land O’Lakes Corporation in Ohio. The accounting business plan that Chalupsky sent to his brother had otherwise been distributed only to a select group of high-level Pro Staff managers and executives and had never been released to anyone outside the company. The recipients of the plan were instructed not to disclose the business plan without the explicit authorization of Pro Staff’s upper management. Pro Staff would not, and has not, permitted a prospective employee to view its accounting business plans. The company only discloses the plan to necessary parties, such as landlords, insurance brokers, accountants, or attorneys. In those limited circumstances, Pro Staff requires the party to enter into a written agreement to maintain confidentiality.
On December 6, 2000, Pro Staff terminated Chalupsky’s employment for cause and without further compensation. Pro Staff based its decision in part on Chalupsky’s unauthorized disclosure of confidential company information in violation of his employment agreement and Pro Staff’s confidentiality policy. The employment agreement’s termination policy was as follows:
Company shall have the right to terminate Employee’s employment without Cause by providing thirty (30) days prior written notice to Employee, or paying Employee for thirty (30) days of Employee’s base salary in lieu of providing such notice. Company shall have the right to terminate Employee’s employment immediately and without notice for Cause, defined as the occurrence of any of the following events:
a. Employee’s willful or continued failure to discharge the duties required of Employee by Company;
b. Employee’s failure or refusal to follow the direction of Company management and/or the Board of Directors;
c. Any breach by Employee of this Agreement’s provisions;
* * *
e. Any act of material misconduct committed by Employee in the performance of Employee’s duties under this Agreement; * * *.
In this action, Chalupsky claimed that Pro Staff wrongfully terminated his employment. Pro Staff moved for summary judgment, which the district court granted. The court concluded that Chalupsky’s sending Pro Staff’s confidential information to a third party who was not bound to keep that information confidential was sufficient as a matter of law to terminate Chalupsky’s employment for cause. This appeal follows.
D E C I S I O N
Summary judgment is appropriate when the evidence shows that “there is no genuine issue as to any material fact and that either party is entitled to judgment as a matter of law.” Minn. R. Civ. P. 56.03; Fisher v. County of Rock, 596 N.W.2d 646, 651 (Minn. 1999). No genuine issue of material fact exists “[w]here the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party.” DLH, Inc. v. Russ, 566 N.W.2d 60, 69 (Minn. 1997) (alteration in original) (quoting Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S. Ct. 1348, 1356 (1986)). “On appeal, the reviewing court must view the evidence in the light most favorable to the party against whom judgment was granted.” Fabio v. Bellomo, 504 N.W.2d 758, 761 (Minn. 1993) (citation omitted). A genuine issue for trial must be established by substantial evidence. DLH, 566 N.W.2d at 69-70. Summary judgment is appropriate where the nonmoving party fails to present evidence that would “permit reasonable persons to draw different conclusions.” Id. at 71.
Specifically, this court must determine whether the district court erred in holding that, as a matter of law, Chalupsky’s disclosure of the confidential accounting business plan breached the provisions of his employment agreement and was not “reasonably necessary or appropriate” in the performance of his duties. The district court found the following undisputed material facts: (1) Chalupsky’s employment agreement prohibited him from disclosing confidential information, (2) Chalupsky knew that Pro Staff’s upper-level management was very concerned about confidential information staying within the company, (3) Chalupsky e-mailed Pro Staff’s confidential accounting business plan to his brother, Mathew, (4) Mathew was not employed by Pro Staff, he had not applied for employment with Pro Staff, and Pro Staff did not have authority or control over him, (5) Chalupsky admitted that he disclosed at least part of the accounting business plan to Mathew, and (6) Chalupsky told a co-worker that he sent Mathew the accounting business plan.
The district court held that, as a matter of law, Chalupsky’s disclosure of the confidential accounting business plan was not “reasonably necessary or appropriate” in connection with his duties. The court found “no reasonable evidentiary support as to why that confidential plan needed to be distributed to his brother.” The court further noted that by sending the e-mail, Chalupsky “put all or part of the confidential written material out into a domain where it could be distributed to anybody,” and it held that Chalupsky’s “position as a senior executive did not legally justify disobedience to his master’s policies and directives.” This court must determine whether the district court erred in applying the law to provisions of the employment agreement.
Determining the construction and effect of an employment contract is a question of law. Turner v. Alpha Phi Sorority House, 276 N.W.2d 63, 66 (Minn. 1979). If an employment agreement is for an indefinite term, the employment is at will, and an employer may summarily dismiss the employee for any reason or no reason. Pine River State Bank v. Mettille, 333 N.W.2d 622, 627 (Minn. 1983). However, Chalupsky was not an at-will employee, since his employment agreement provides for either (1) discharge for any reason, with 30 days notice or pay or (2) immediate discharge for cause. See Cedarstrand v. Lutheran Bhd., 263 Minn. 520, 532-33, N.W.2d 213, 221, (1962) (noting that at-will employment may be modified by employment contract providing employee’s discharge for cause). Disobedience of a reasonable order justifies an employer’s rescission of the employment agreement and discharge of the employee. Von Heyne v. Tompkins, 89 Minn. 77, 81, 93 N.W. 901, 903 (1903). In such a case, the actual motive of an employer is immaterial if any legal ground exists for the discharge. Id. at 82-83, 93 N.W. at 903-04.
Chalupsky first argues that the district court erred by placing little credence in his claim that he sent the accounting business plan to his brother in an attempt to honor his undisputed contractual obligation to “recruit and hire managerial and other key employees.” He contends that his disclosure of the accounting business plan was “reasonably necessary or appropriate in connection with the performance * * * of [his] duties.” Chalupsky’s contention is not supported by the record. The record indicates that the company has never disclosed the accounting business plan to a prospective employee. Further, there is no evidence that Mathew had applied for, or was even seriously considering, a position with Pro Staff. Finally, the record contains no evidence that Mathew signed a confidentiality statement. In light of this, it appears that the district court was accurate when it described this argument as unreasonable and “dubious.” Therefore, Chalupsky’s disclosure of the confidential information was neither “reasonably necessary” nor “appropriate” in fulfilling his duties under the employment agreement. Since there are instances where disclosure is reasonably necessary, the confidentiality clause is not rendered meaningless by the holding of this case.
Chalupsky next argues that the district court violated the general principle prohibiting a clause from being so strictly construed as to lead to a harsh and absurd result. See Am. Warehousing & Distrib., Inc. v. Michael Ede Mgmt., Inc., 414 N.W.2d 554, 557 (Minn. App. 1987), review dismissed (Minn. Jan. 20, 1988). He contends that if the exception allowing Chalupsky to disclose the confidential information where “reasonably necessary and appropriate” does not apply to the facts of this case, then the exception is rendered meaningless. See Ind. Sch. Dist. No. 887 v. Loberg Plumbing & Heating Co., 266 Minn. 426, 436, 123 N.W.2d 793, 799-800 (1963) (holding that any interpretation rendering a provision meaningless should be avoided). Pro Staff has indicated several circumstances in which disclosure of confidential information to persons outside of the company would be considered to be reasonably necessary, including disclosures to accountants, lawyers, and other persons who have signed written confidentiality or nondisclosure agreements. The record reveals no other instance where Pro Staff disclosed such confidential information to a prospective employee. Further, the accounting business plan itself states that the recipients may not disclose the document to anyone outside of the company without written authorization from upper management. Chalupsky did not receive any such authorization.
Because there are no genuine issues of material fact, and because, as a matter of law, Chalupsky’s disclosure of confidential information to a third party was not “necessary or appropriate” in the performance of his duties, the district court did not err in granting summary judgment.