Sept. 1, 2009 – Despite some confusion over the exact standard for negligence currently used in the state, the Wisconsin Court of Appeals concluded that a security firm was not negligent for the sexual misbehavior of its employee.

In Maypack v. Securitas Security Services USA, 2008AP1528, the court remarked that two recent Wisconsin Supreme Court decisions left unclear whether unforeseeable harm is to be evaluated as an instance of no duty arising under the circumstances, or if the defendant’s actions constituted no breach of the duty of ordinary care.

Under either analysis, the court of appeals stated, the employer was not negligent, reversing the circuit court’s $1.4 million verdict.

Photos for security badges

Securitas’ employee, Troy Schmidt, worked as a guard at the entrance to Polaris Industries’ parking lot. As the security manger, Schmidt was responsible for producing the badges, giving him access to employee photographs.

At some point, Schmidt copied the photographs of approximately 30 female employees to a flash drive. He printed the photographs at home, ejaculated on them, and posted pictures of the adulterated photos on adult web sites he created on Yahoo!

When Polaris was alerted to one of the web sites, it searched the guard shack and located unadulterated badge photos that appeared similar to those found online. Polaris identified Schmidt as the likely perpetrator because he could access the photos and the user-identifying information on the website matched his personal background. Polaris printed copies of the web site postings and later prepared a report of its investigation.

Polaris met with Securitas to discuss the issue. Securitas immediately fired Schmidt after he admitted posting the images. Polaris demanded that Schmidt remove the offensive material, which he did.

One of the affected employees contacted police, who referred the matter to the district attorney’s office. The district attorney determined there was no prosecutable crime.

Two different sets of plaintiffs filed civil actions. After Polaris was dismissed from the one action in which it was named, the two cases were consolidated. Following a bench trial, the court found Schmidt liable for defamation and invasion of privacy and Securitas liable for negligent training and supervision. The court awarded the 10 plaintiffs damages in varying amounts of $50,000, $75,000, and $333,333. Securitas appealed.

Not negligent as a matter of law

In an opinion authored by Presiding Judge Michael Hoover, the court of appeals concluded that Securitas was not negligent on forseeability grounds, despite conflicting guidance from the Wisconsin Supreme Court.

“We view the ultimate issue of negligence as a rather straightforward matter in this case,” the court remarked. “However, given recent guidance from our supreme court, it is unclear how we are to set forth our analysis.”

“Depending on the cases we review, we should either (1) evaluate whether Securitas had a duty under the circumstances of this case, see Hocking v. City of Dodgeville, 2009 WI 70, or (2) consider whether Securitas’s actions constituted a breach of the duty of ordinary care, see Behrendt v. Gulf Underwriters Insurance Co., 2009 WI 71,” the court said.

In a footnote, the court added, “Not only do the majority opinions in Hocking and Behrendt point us in different directions, but so do the concurring opinions.”

“We conclude it does not matter which approach we employ because, in the end, they are one and the same,” the court wrote. “A conclusion of no negligence under the first approach requires that we determine the defendant was not required to act, while under the second it requires that we determine there was no breach for failing to act because the defendant was not required to act.”

“Without explicitly employing either approach in this case, we simply conclude Securitas was not negligent, as a matter of law,” the court stated.

The court cited Sigler v. Kobinsky, 2008 WI App 183, as another negligent supervision case in which an employer was held not negligent for an employee’s use of his work computer to harass the plaintiffs. “We concluded there was no duty of care ‘[b]ecause it was not reasonably foreseeable that permitting employees to have unsupervised access to the internet would probably result in harm to some person or some thing,’” the court wrote.

Securitas’ actions considered

Reviewing the record, the court noted that Securitas had provided Schmidt with training concerning both sexual harassment and employee theft. Further, the court found that Polaris could track the guards’ Internet usage, but that Polaris never notified Schmidt’s supervisor of any concerns about the volume of nature of Internet use. By itself, the court commented, “[t]here is nothing inherently dangerous about permitting employees to access the internet at work.”

The court of appeals disagreed with the trial court’s concern that Securitas did not monitor Schmidt’s access to the Polaris employee photos, remarking that Schmidt’s job required him to copy and transfer photos to make badges. “Thus, there would have been nothing to alert Polaris or Securitas that something was amiss,” the court said.

Also differing with the trial court, the court of appeals said that after Securitas fired Schmidt, it was not reasonable to expect Securitas to do anything more. “Polaris, whose unidentified employees were the ones affected, represented that it was handling the matter and that the offending materials had been removed from the internet,” the court wrote.

The trial court had suggested that Securitas should have notified and followed up with law enforcement, but the court of appeals pointed out that the affected employees had done that.

Public policy concerns

In addition to finding Securitas not liable as a matter of law, the court listed public policy concerns that would preclude liability.

First, the court stated, the plaintiff’s injuries were too remote from the alleged negligence. “It would be an understatement to say Schmidt’s actions were bizarre and unexpected,” the court said.

The court also concluded that recovery would have no sensible or just stopping point.  Securitas had trained Schmidt in an effort to prevent these problems and ensured that internet use was monitored and filtered at work. “[C]ontrary to the trial court’s conclusion, employers have no duty to supervise employees’ private conduct or to persistently scan the world wide web to ferret out potential employee misconduct,” the court wrote.

“Were we to allow the plaintiffs’ claims here to proceed, ‘this expansion of liability would be limitless and turn employers into guarantors or insurers,’” the court added, quoting Sigler.