In Casella v. SouthWest Dealer Services, Inc., a California court of appeal affirmed the jury verdict for wrongful termination in violation of public policy against a company selling extended warranties. Plaintiff had complained to management that retail customers were quoted an inflated monthly payment for the automobile in order to entice customers to purchase an extended warranty at supposedly low (but inaccurate) prices. The court held that such an internal complaint about a fraud on the public violated California public policy.
In November 2002 Zachary Casella was hired by Southwest Dealer Services, Inc. On April 3, 2003 Casella’s employment was terminated. Casella had been a representative for Southwest Dealer Services, a company which provides aftermarket products for car dealers. Casella claims he had been required to track dealer practices which he felt were illegal and/or unethical. After he complained to the President of Southwest Dealer Services, he was fired.
The lawyers of Jorgensen & Salberg sued Southwest Dealer Services for wrongful termination. A jury returned a special verdict in favor of Casella on each of his claims against defendants, and awarded Casella a total of $480,003, including punitive damages.
Southwest Dealer Services appealed. Their basis for appeal? Southwest Dealer Services claimed that the practice of defrauding customers was not illegal when they terminated Casella’s employment. In February 2008, the Court of Appeal disagreed.