• May 1, 2013

Update (May 1, 2013):  Mr. Vaidyanathan and his counsel, Stephen J. Snyder, have now been put through two trials, one in which Mr. Vaidyanathan won a verdict of $1.9 million and the second of which resulted in a hung jury.  It could have gone worse, of course.  The standard that the U.S. Court of Appeals established — that Seagate had to have known that its statements to Vaidyanathan recruiting him for a position that never existed were false at the time that Seagate made the statements to Mr. Vaidyanathan under the applicable Minnesota workers’ protection statute — was a very big hurdle to overcome.  (And the statute does expressly refer to “knowingly false” statements….)

Update (November 8, 2012): A Minnesota Litigator failed prediction, below.  Chandramouli Vaidyanathan sued Seagate because, in his view, Seagate lured Vaidyanathan from Texas to a job in Minnesota and then did not give him the job for which he had been hired and then laid him off.  A jury awarded Vaidyanathan $1.9 million.  The Eighth Circuit reversed, finding that the District Court Judge’s jury instruction did not accurately state Minnesota law.  

Court of Appeals Judge Lavenski R. Smith dissented.  I agree with his dissent the gist of which is that one is making a “knowingly false representation” if one is making a representation of fact in a manner suggesting one has a basis in knowledge for the representation when one does not.  

Here is an analogous example:  if Joe tells Jack that he, Joe, knows there is a pot of gold buried 40 feet down at a particular spot, and, in fact he has no basis for that statement.  It is a “knowingly false statement” regardless of the fact that Joe does literally know, as a matter of fact, whether there is a pot of gold down there or not.

That is, it would not seem right that Joe could escape liability for his misleading Jack by arguing that he did not know with certainty that his statement was false.  That, however, would seem to be the upshot of the Court’s analysis.

Update (February 22, 2012):  As described in the original Minnesota Litigator post below, Seagate lost a jury trial before U.S. District Court Judge Donovan W. Frank (D. Minn.).  Seagate, represented by Aaron Van Oort of Faegre Baker Daniels, argued the appeal of that jury verdict at the 8th Circuit  last week (Judges William Jay Riley, Roger L. Wollman, Lavenski R. Smith).

Seagate should only be liable, Van Oort argued, if it knew it was lying to plaintiff Vaidyanathan, not if it merely recklessly induced the man to take a job that Seagate did not have to offer.  The jury instructions at trial, Van Oort argued, likely led the jury to find Seagate liable without a finding of “knowing falsity.”  (Seagate argued two other grounds, as well (sufficiency of evidence of “kind or character of the work” under a Minnesota employment statute (Minn. Stat. §181.64), and the measure of damages)).  (Craig Brandt argued on behalf of the plaintiff, Mr. Vaidyanathan.)

Minnesota Litigator will predict affirmance, given the deference appeals courts understandably tend to give jury trial verdicts (it is an awfully expensive process in every sense), the nature of Seagate’s challenges to the rulings by the district court, and the underlying found facts of the case.  But time will tell.

Original Post (December 13, 2010):  How many business plans over the past few years have taken unexpected detours down dead-end streets as the bottom dropped out of our economy? The costs to businesses and to employees have been great and incalculable.  In every case there is a question: how are these costs to be apportioned between disappointed businesses and disappointed employees?

Chandramouli Vaidyanathan, PhD, uprooted his family from Texas, where he was a yield engineer at Texas Instruments, to be a yield engineer at Seagate.  Or so he thought.  Vaidyanathan came to Minnesota, never worked as a yield engineer, and was then laid off (along with many other Seagate employees).  A jury and U.S. District Court Judge Donovan W. Frank (D. Minn.) have found that Seagate violated Minnesota law by holding out a job offer to Dr. Vaidyanathan for a position that, ultimately, it turned out Seagate did not have to offer.

The jury found damages of $1.9 million.

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