Court: Internally Complaining Fiduciary Not Protected From Termination

February 1, 2005 ( - The Maryland Court of Special Appeals has ruled that an employee fired for complaining about her employer's transfer of funds from a company health plan to a general corporate account was not wrongly terminated.

>In a January 27 ruling in King v. Marriott International Inc., the court has ruled that no public policy was violated with Marriott firing Karen King, a worker with the company’s benefits department. After being bounced between federal and state courts over the issue of whether the case falls under Employee Retirement Income Security Act (ERISA) jurisdiction, the state court made the ruling that King was not improperly fired.

>King had filed suit after her termination in 2000, an event that followed close on the heels of King complaining to superiors and other employees that the company was transferring $7.3 million from the health plan to the general corporate account. After the case moved to federal court, federal appeals court and a Maryland state trial court, it was ruled that although King did have a fiduciary duty to the beneficiaries of the plan, the focus of the inquiry was on the act of reporting the alleged violations to her peers and superiors, not whether she was protected by ERISA. The court noted that there is a distinction between external and internal reporting of corporate wrongdoing with regards to ERISA and that there is no protection offered in Maryland law to those who complain internally in such a case.

“While we recognize that there is a general policy in Maryland that a fiduciary must serve the interests of the beneficiaries, we do not find any policy that protects a fiduciary who makes an internal complaint of corporate wrongdoing to co-workers and supervisors,” wrote Judge James Eyler in affirming the decision of a lower state court.

>The ruling is available  here .