Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-almd-2_11-cv-00217/USCOURTS-almd-2_11-cv-00217-1/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 28:1332 Diversity-Breach of Contract

---

1. Palmer concedes that summary judgment in favor of

Infosys is appropriate on the aspect of his claim

alleging negligent hiring, etc. of the “Whistleblower”

team. The aspect of his negligent-training claim

involving the “Human Resources” team remains pending.

Palmer Opposition Brief (Doc. No. 87) at 37.

 IN THE DISTRICT COURT OF THE UNITED STATES FOR THE

MIDDLE DISTRICT OF ALABAMA, NORTHERN DIVISION

JACK “JAY” PALMER, JR., )

)

 Plaintiff, )

) CIVIL ACTION NO.

v. ) 2:11cv217-MHT

) (WO) 

INFOSYS TECHNOLOGIES )

LIMITED INCORPORATED and )

INFOSYS LIMITED, )

)

Defendants. )

OPINION

Plaintiff Jack “Jay” Palmer, Jr., brings this lawsuit

against defendants Infosys Technologies Limited

Incorporated and Infosys Limited (together referred to as

“Infosys”) based on these state-law claims: breach of

contract; outrage; negligence and wantonness; negligent

hiring, training, monitoring and supervising; and

fraudulent misrepresentation.1

 Jurisdiction is proper

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under 28 U.S.C. §§ 1332 (diversity) & 1441 (removal).

Infosys now moves for summary judgment in its favor. For

the reasons given below, the motion will be granted.

I. SUMMARY-JUDGMENT STANDARD

Summary judgment is appropriate “if the movant shows

that there is no genuine dispute as to any material fact

and the movant is entitled to judgment as a matter of

law.” Fed. R. Civ. P. 56(a). The court must view the

evidence in the light most favorable to the non-moving

party and draw all reasonable inferences in favor of that

party. Matsushita Elec. Indus. Co. v. Zenith Radio Corp.,

475 U.S. 574, 587 (1986).

II. BACKGROUND

Infosys is a software company based in Bangalore,

India. Like many firms in our global economy, it works

across borders and employs citizens from numerous

countries. It often needs to obtain visas for its Indian

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2. Palmer’s brief spends an inordinate amount of

time addressing whether Infosys engaged in visa fraud.

To be clear, this litigation does not concern whether

Infosys violated American immigration law. Rather,

Palmer’s suit rises and falls on a simple inquiry:

whether he has created a genuine dispute of material fact

on his state-law claims. 

3

employees to travel to the United States for conferences

or to work on a permanent basis.

Infosys also employs American citizens in the United

States. Palmer began working for Infosys in August 2008

as a principal consultant. His starting salary was set at

$ 145,008, and he is eligible for bonuses per the

company’s incentive plan. His job as a consultant

requires that he rotate on and off projects.

While on a business trip to Infosys’s corporate

headquarters in March 2010, Palmer uncovered a massive

visa fraud.2

 He believes that the company manipulated the

B-1 visa program, which permits business visits, in order

to send Indian employees to the United States to work on

a permanent basis. In May 2010, the company asked him to

write “welcome letters” for prospective B-1 visa

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applicants; he thought that these letters were fraudulent

and refused to participate in the scheme. Shortly

thereafter, he notified Linda Manning in Infosys’s Human

Resources Department about the alleged visa fraud. In

response to his complaint, he was chastised by his

supervisors and told to “keep quiet.” In October 2010,

after repeated requests that he participate in the visafraud scheme, he met with the company’s in-house counsel

and decided to file an internal whistleblower complaint.

Palmer subsequently reported these allegations to

federal authorities. As a result, Infosys is currently

under investigation by the Department of Homeland Security

and a federal grand jury. He has also testified before

the United States Senate Subcommittee on Immigration,

Refugees, and Border Security.

Palmer contends that, since his visa-fraud allegations

he has been the target of a retaliation campaign. His

grievances can be grouped into two categories. First, he

contends that his bonuses have been adversely affected.

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3. Palmer, however, refuses to hand over his company

computer for examination out of fear that someone will

copy his hard drive.

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He believes that the bonuses he received in June 2010

($ 16,229), December 2010 ($ 7,251), June 2011 ($ 12,534),

and December 2011 ($ 8,000) were below the rate set in his

contract. Second, he submits that he has been the target

of harassment. Regarding work assignments, he was placed

on projects from October 2009 to June 2010, July 2010 to

October 2010, and October 2010 to April 2011; however, he

has not had an assignment since April 3, 2011, and spends

his days sitting at home waiting for work to come in from

the company. He believes that the company is refusing to

give him work in an attempt to force him out. Further, he

complains that he has experienced many computer problems

and has been shut out of the company’s network.3

 

Perhaps most worrisome, Palmer has received numerous

threats related to his visa-fraud allegations. These

threats include:

! On October 27, 2010, at 12:37 a.m.,

Palmer’s wife answered their home phone

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and a man with an Indian accent asked to

speak with him. His wife said he was

unavailable, and the caller mumbled

something and hung up. A similar

incident occurred that same night at

2:27 a.m.

! Palmer has received other threatening

calls along the lines of “Why are you

doing this, you stupid American, we have

been good to you.”

! On February 28, 2011, Palmer reported

to work to find a note on his keyboard

stating that, “Jack: Just leave your not

wanted here hope your journey brings you

death stupid American.” Palmer Exhibit

13 (Doc. No. 47-5) at 6 (typographical

errors in original). When Palmer turned

on his computer, a word document

displayed the same message.

! On April 21, 2011, Palmer received an

email stating that, “if you make cause

for us to sent back to india we will

destroy you and yuor family.” Palmer

Exhibit 14 (Doc. No. 46-5) at 7

(typographical errors in original). 

! On May 25, 2011, Palmer received a

threat through his LinkedIn account from

Vinodbhai Mankar, an Indian national and

self-professed “advocate” of Infosys:

“you still working at infy? they should

have fired you long back ... after you

stabbed their back by falsely

implicating them on the misuse of visa.

unfortunately infy is an indian company

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and indian’s don’t stab ... even in the

front. that’s what hypocrites like you

take advantage of. Hope they learn the

rule of Tit for Tat. I just wish you

were here in India. we would have taken

*good* care of you.” Palmer Exhibit 11

(Doc. No. 47-4) (typographical errors in

original).

As a result of these threats, Palmer is emotionally

distraught, takes antidepressants, and sometimes carries

a concealed gun.

III. DISCUSSION

Infosys moves for summary judgment on all five of

Palmer’s state-law claims. Because the basis of the

court’s jurisdiction is diversity and because the claims

at issue are state claims, it is Alabama substantive law,

not federal substantive law, that governs this case. Erie

R.R. v. Tompkins, 304 U.S. 64, 78 (1938). This court must

therefore make an educated guess of how the Alabama

courts, and, in particular, the Alabama Supreme Court,

would resolve these claims. Blue Cross & Blue Shield of

Ala., Inc. v. Nielsen, 116 F.3d 1406, 1413 (11th Cir.

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1997) ("The final arbiter of state law is the state

supreme court, which is another way of saying that Alabama

law is what the Alabama Supreme Court says it is.").

Because Palmer’s claims arise out of his employment,

it is important to keep in mind that Alabama is an ‘atwill’ employment state. The Alabama Supreme Court has

explained that: "The bedrock principle of Alabama

employment law is that, in the absence of a contract

providing otherwise, employment in this state is at-will,

terminable at the will of either party. Under this

doctrine, an employee may be discharged for any reason,

good or bad, or even for no reason at all.” Ex parte

Amoco Fabrics and Fiber Co., 729 So. 2d 336, 339 (Ala.

1998). And an extension of this principle and logic would

be that, absent a contract providing otherwise, employee

may be demoted, denied a promotion, or otherwise adversely

treated for any reason, good or bad, or even for no reason

at all. The Alabama Supreme Court has, rightly or

wrongly, jealously guarded this at-will status and

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recognized only statutory exceptions (for example,

worker’s compensation restrictions) and a few narrow nonstatutory exceptions. See id. (“Among those [nonstatutory] limitations is an exception, recognized by [the

Alabama Supreme] Court, for implied contracts arising out

of the use of an employee handbook. ... [T]he provisions

of an employee handbook can become a binding unilateral

contract, thereby altering an employment relationship’s

at-will status. ... [But] not all employer communications

would justify such treatment. Rather, only those employer

communications meeting the traditional requirements for

the formation of a unilateral contract--an offer,

communication, acceptance, and consideration--will bind

the parties."). It is against this backdrop of Alabama

law, like it or not, that the court considers Palmer’s

claims arising out of his employment.

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A. Breach of Contract

Palmer contends that he and Infosys had a contract

that the company breached. To make out a

breach-of-contract claim, he must show (1) a valid

contract binding the parties, (2) his own performance

under the contract, (3) Infosys’s nonperformance, and (4)

damages. State Farm Fire & Cas. Co. v. Slade, 747 So. 2d

293, 303 (Ala. 1999).

Palmer contends that Infosys breached its contract

with him by not paying him a 30 % bonus. He believes that

his semiannual bonuses since June 2010 have been

undervalued. Additionally, he submits that his “on the

bench” status–-that is, that he has not received an

assignment since April 2011–-contributes to his reduced

bonuses.

First, there is no formal document, signed by Palmer

and an appropriate Infosys officer or supervisor, bearing

the heading “employment contract” or something comparable.

Rather, to support the notion that he has an employment

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4. Palmer does not challenge his bonuses from 2008

and 2009.

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contract, Palmer relies on an annual letter or document

the company sends him setting forth his salary and

possible bonus. While the court doubts that this document

constitutes an employment contract, the court will assume

that it does, for Palmer cannot recover on his breach-ofcontract claim even it does.

First of all, Palmer misconstrues the document. As an

initial matter, the document does not state that he is

entitled to a 30 % bonus in any year. Rather, it states:

“For this year [2008], the maximum bonus you can earn will

be 30 % of your paid our Base Salary.” Infosys Contract

(Doc. No. 47-1) at 133. Thus, Palmer was not even

entitled to 30 % bonus for his first year at the company.4

 Moreover, Palmer’s bonuses are governed by Infosys’s

incentive plan, which awards bonuses on a sliding scale

from 0 % to 100 % of base salary. Bonuses are set

according to a multi-factor analysis, which looks to

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5. Palmer initially argued that Infosys had failed

to reimburse him for certain expenses. Because Infosys

has rectified that situation, Palmer has dropped that

allegation. Response to First Interrogatories (Doc. No.

47-7) at 4.

12

individual, unit, and company-wide performance.

Additionally, the incentive plan provides that:

“The company reserves the right to

administer, construe and interpret the

Plan to make all determinations related

to the Plan to approve all bonus

payments prior to payment, and to

resolve all issues and disputes related

to the Plan, all in the Company’s

discretion. The Company’s decisions on

these subjects shall be final,

conclusive and binding on all concerns.”

Incentive Plan (Doc. No. 47-6) at 3. Palmer, therefore,

is not entitled to any specific bonus amount in any year.

As such, he cannot establish his breach-of-contract claim

under Alabama law.5

B. Outrage

Palmer contends that, despite the at-will status of

employees in this state, Infosys’s overall treatment of

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him in his employment supports a claim based on the tort

of outrage. Alabama’s tort of outrage “is essentially

equivalent to what many states refer to as ‘intentional

infliction of emotion distress.’” K.M. v. Alabama

Department of Youth Services, 360 F. Supp. 2d 1253, 1259

n.4 (M.D. Ala. 2005) (Thompson, J.). In order to prove a

claim of outrage, a plaintiff must establish that, “(1)

the defendant ... intended to inflict emotional distress,

or should have known that his or her acts would result in

emotional distress; (2) the act [was] extreme and

outrageous; (3) the act ... caused plaintiff['s] distress;

and (4) plaintiff['s] emotional distress [was] so severe

that no reasonable person could be expected to endure it.”

Id. at 1259 (citing Harrelson v. R.J., 882 So. 2d 317, 322

(Ala. 2003)). The Supreme Court of Alabama has emphasized

“that this tort does not recognize recovery for ‘mere

insults, indignities, threats, annoyances, petty

oppressions, or other trivialities.’” American Rd. Serv.

Co. v. Inmon, 394 So. 2d 361, 364-65 (Ala. 1980) (citation

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omitted). Rather, recovery is appropriate for only

“conduct so outrageous in character and so extreme in

degree as to go beyond all possible bounds of decency, and

to be regarded as atrocious and utterly intolerable in a

civilized society.” Id. at 365. The tort is, therefore,

“an extremely limited cause of action.” Potts v. Hayes,

771 So.2d 462, 465 (Ala.2000). 

In the at-will employment context, Alabama courts have

especially cabined the tort of outrage. A plaintiff

alleging outrage based upon a termination must establish

that the firing was contrary to public policy and was

accompanied with the “sound of fury.” Wal-Mart Stores,

Inc. v. Smitherman, 872 So. 2d 833, 840 (Ala. 2003)

(quoting Harrell v. Reynolds Metals Co., 495 So. 2d 1381

(Ala. 1986)). One federal district court has commented

that “unlawful conduct falling short of discharge[] may be

inadequate to sustain a claim for outrage under Alabama

law, even if the employer’s acts otherwise are

irreconcilable with sound public policy.” Lees v. Sea

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6. Egregious sexual harassment appears to be the

sole example of an outrage claim from the employment

context that does not involve a termination. Carraway

Methodist Health Systems v. Wise, 986 So. 2d 387, 401

(Ala. 2007).

7. Palmer points to Holmes v. Oxford Chemicals,

Inc., 672 F.2d 854 (11th Cir. 1982), as an additional

basis for his outrage claim. In Holmes, the plaintiff

suffered a heart attack that rendered him permanently

disabled. His employer reduced his disability benefits

from $ 500 a month to $ 49.10 in an attempt to force him

to apply for Social Security disability. Id. at 856.

Here, by contrast, Palmer’s base salary has increased

from $ 145,008 in 2008 to $ 165,000 today. While Palmer

believes his bonuses are inadequate, he cannot base a

claim of outrage on salary diminution given the

undisputed facts about his base salary. 

15

Breeze Health Care Center, Inc., 391 F. Supp. 2d 1103,

1107 n.3 (S.D. Ala. 2005) (Steele, J.). This limiting

principle accords with the Supreme Court of Alabama’s

admonition that outrage “should not be the basis for

vicarious or respondeat superior liability except in the

most compelling circumstances.” Busby v. Truswal Systems

Corp., 551 So. 2d 322, 327 (Ala. 1989).6

Palmer asserts that the campaign of harassment and, in

particular, the numerous threats he has received are

sufficient to state a claim of outrage under Alabama law.7

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Courts have frequently rejected outrage claims based on

similar accusations of threats and disparate treatment at

work. See, e.g., Thrasher v. Ivan Leonard Chevrolet,

Inc., 195 F. Supp. 2d 1314, 1319 (N.D. Ala. 2002)

(Buttram, J.) (finding that “discrimination with regard to

overtime hours, scrutiny, and termination-–which lasted a

period of eight days–-is not sufficiently egregious” to

support an outrage claim). The court finds Little v.

Robinson, 72 So. 3d 1168 (Ala. 2011), particularly

instructive. The plaintiff, a city council member,

alleged that the mayor of Anniston issued a death threat

during a public meeting and that the two men almost came

to blows. The mayor also stated that Little was part of

the “black corruption” problem in the city. Id. at 1170.

The Supreme Court of Alabama disagreed that the mayor’s

comment–-that if “it had gotten ugly, ‘[w]e’d be having

[Little’s] funeral today,’” id. at 1169-–was a death

threat but nonetheless recognized that the two men were

engaged in a heated confrontation that quickly escalated.

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8. Because this court concludes that the Alabama

Supreme Court would find that the alleged conduct was

not extreme or outrageous, this court need not decide

Infosys’s alternative contention that there is no

evidence that the threats were made by its employees.

17

Id. at 1173. Despite a near-physical encounter and

racially explosive language, the Supreme Court of Alabama

concluded that the mayor’s behavior did not constitute

outrage as a matter of law. Id.

Similarly, while the electronic and telephonic threats

and anti-American statements are deeply disturbing, it is

clear that the Alabama Supreme Court would not view them

as “beyond all possible bounds of decency,” so that it

must “be regarded as atrocious and utterly intolerable in

a civilized society.” Inmon, 394 So. 2d at 365. Moreover,

under Alabama law, because Palmer has not been terminated,

a claim of outrage may only proceed to trial under the

most egregious fact pattern. Alabama law is, therefore,

clear that the record here is insufficient to support the

“extremely limited cause of action” known as the tort of

outrage.8

 Potts, 771 So.2d at 465. 

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Although not mentioned by the parties, the court

notes that the United States Supreme Court’s recent

decision in Snyder v. Phelps, 131 S. Ct. 1207 (2011), may

be applicable in this case. The Snyder Court held that an

intentional infliction of emotion distress claim is

barred if the challenged speech was on a matter of public

concern. “Speech deals with matters of public concern

when it can be fairly considered as relating to any

matter of political, social, or other concern to the

community.” Id. at 1216 (internal quotation marks

omitted). It can hardly be disputed that immigration

policy is a matter of public concern. Additionally,

Palmer received the email threats after he went public

with his story; as Palmer’s brief explains, the complaint

filed in this action prompted considerable discussion in

the information-technology industry. Palmer Opposition

Brief (Doc. No. 87) at 17. The threats directed at

Palmer, while objectionable, are part and parcel of

injecting oneself into the political arena. Cf. Doe v.

Reed, 130 S. Ct. 2811, 2837 (2010) (Scalia, J.,

concurring in the judgment) (remarking that “harsh

criticism, short of unlawful action, is a price our

people have traditionally been willing to pay for

self-governance. Requiring people to stand up in public

for their political acts fosters civic courage, without

which democracy is doomed”). As such, the First

Amendment may present a bar to Palmer’s outrage claim

because “‘in public debate [we] must tolerate insulting,

and even outrageous, speech in order to provide adequate

“breathing space” to the freedoms protected by the First

Amendment.’” Snyder, 131 S. Ct. at 1219 (quoting Boos v.

Barry, 485 U.S. 312, 322 (1988)) (alteration in

original).

18

C. Negligence and Wantonness

Palmer brings a claim of negligence and wantonness.

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More specifically, he believes that Infosys has failed to

protect him from retaliation in violation of its

whistleblower policy.

To prove a negligence claim under Alabama law, a

plaintiff must establish duty, breach, causation, and

damages. Armstrong Business Services, Inc. v. AmSouth

Bank, 817 So. 2d 665, 679 (Ala. 2001). A wantonness

claim requires a plaintiff to demonstrate that the

defendant acted or failed to act with reckless

indifference to the consequences of its acts or omissions.

 Id. at 679-80. 

Infosys argues, and this court agrees, that Palmer is

attempting to bootstrap a whistleblower retaliation claim

into a negligence or wantonness tort. But there is no

evidence that Alabama tort law recognizes (arguably as an

exception to the State’s at-will status) an independent

cause of action for negligently or wantonly failing to

prevent whistleblower retaliation. As such, Palmer’s

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negligence-and-wantonness claim must fail under Alabama

law.

D. Negligent Hiring, Training, Monitoring, and 

Supervising 

Palmer also brings a claim of negligent hiring,

training, monitoring, and supervising. “A party alleging

negligent or wanton supervision and hiring must ... prove

the underlying wrongful conduct of employees.” Voyager

Ins. Companies v. Whitson, 867 So. 2d 1065, 1073 (Ala.

2003).

Palmer has conceded that his negligent hiring, etc.

claim is contingent on his negligence-and-wantonness

claim. See Palmer Opposition Brief (Doc. No. 87) at 37;

see also supra Section III.C. Because Palmer’s

negligence-and-wantonness claim fails under Alabama law,

so, too, does his negligent hiring, etc. claim.

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E. Fraudulent Misrepresentation

Palmer submits that Infosys’s failure to enforce its

whistleblower policy constitutes fraudulent

misrepresentation. Because his claim is predicated on a

promise of future behavior-–namely, to enforce the

whistleblower policy--Palmer must establish the elements

of promissory fraud. Wade v. Chase Manhattan Mortgage

Corp., 994 F. Supp. 1369, 1378-79 (N.D. Ala. 1997)

(Hancock, S.J.). To make out a promissory-fraud claim,

Palmer must show that "(1) a false representation (2) of

a material existing fact (3) reasonably relied upon by

[him] (4) who suffered damage as a proximate consequence

of the misrepresentation." S.B. v. St. James Sch., 959

So.2d 72, 101 (Ala. 2006) (quotations and citations

omitted). In addition, he must show that "(5) .. at the

time of the misrepresentation, the [company] had the

intention not to perform the act promised, and (6) ... the

[company] had an intent to deceive." Id.

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Here, Palmer has failed to establish the fifth and

sixth elements of his claim. He has presented no evidence

that, when Infosys issued its whistleblower policy in

2003, it intended to deceive and not enforce the policy.

As such, Palmer’s fraud claim must fail under Alabama law.

* * *

Without question, the alleged electronic and

telephonic threats are deeply troubling. Indeed, an

argument could be made that such threats against

whistleblowers, in particular, should be illegal. The

issue before the court, however, is not whether Alabama

should make these alleged wrongs actionable, but whether

they are, in fact, illegal under state law. This court

cannot rewrite state law. Therefore, for the reasons

given throughout this opinion, this court must conclude

that, under current Alabama law, Palmer has no right to

recover from Infosys.

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An appropriate summary judgment in favor of Infosys

and against Palmer will be entered.

DONE, this the 20th day of August, 2012.

 /s/ Myron H. Thompson 

UNITED STATES DISTRICT JUDGE

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