## Facts

- Sigitas Banaitis worked as a vice president and commercial loan officer for The Bank of California, N.A. (BanCal).
- BanCal maintained a strict confidentiality policy protecting customer financial information, with immediate dismissal for violations and annual employee certifications.
- Mitsubishi Bank, Ltd. (MBL) acquired control of BanCal and placed MBL personnel in management roles at BanCal, including Banaitis’s supervisor.
- Following the acquisition, BanCal customers expressed concerns that their sensitive financial information could be shared within the larger Mitsubishi corporate group for competitive use.
- MBL personnel requested detailed financial information about BanCal customers, including a “comparison chart” containing sensitive data (e.g., cash, receivables, inventory, debt, net worth, and operating figures).
- Banaitis refused to provide the information, believing disclosure would violate confidentiality obligations and customer expectations.
- MBL and BanCal management repeatedly pressed Banaitis to comply; he continued to refuse.
- BanCal terminated Banaitis in 1987, with the case tried on the theory that the termination resulted from his refusal to disclose confidential customer information.
- Banaitis sued BanCal for wrongful discharge and sued MBL for intentional interference with contractual relations; a jury awarded compensatory damages on both claims and punitive damages against both defendants.
- The trial court entered judgment for compensatory damages but granted JNOV setting aside punitive damages; defendants appealed liability and plaintiff cross-appealed the punitive-damages JNOV.

## Issues

1. Whether a common-law wrongful discharge claim lies where an employee is terminated for refusing to disclose confidential bank customer information in alleged violation of public policy.
2. Whether a parent/controlling corporation can be liable as a third party for intentionally interfering with a subsidiary’s employment relationship, or is privileged as part of the relationship.
3. Whether the evidence was sufficient to submit punitive damages to the jury and whether JNOV eliminating punitive damages was error.

## Decision

- The court affirmed the judgment for compensatory damages on the wrongful discharge claim against BanCal.
- The court affirmed the judgment for compensatory damages on the intentional interference claim against MBL.
- The court reversed the JNOV on punitive damages and remanded with instructions to reinstate the jury’s punitive damages awards against both defendants.

## Legal Principles

- Oregon recognizes a narrow common-law wrongful discharge tort when an employee is terminated for fulfilling a public duty or for refusing to violate a clearly defined public policy.
- Confidentiality of bank customer financial affairs can constitute an important public policy grounded in banking regulation and the public’s interest in the integrity of banking relationships.
- A parent or affiliated corporation may be treated as a third party to a subsidiary’s employment contract for purposes of intentional interference, and any managerial privilege does not protect conduct found to be intentional and improper.
- Punitive damages may be awarded when the evidence permits a finding of aggravated misconduct, such as reckless and outrageous indifference to a highly unreasonable risk of harm or conscious disregard of others’ rights; such awards must stand if supported when viewing the evidence favorably to the verdict.

## Conclusion

The court held that terminating a bank employee for refusing to disclose confidential customer financial information can support wrongful discharge liability, that a controlling parent bank may be liable for intentionally and improperly inducing the discharge, and that punitive damages were supported by evidence of conscious wrongdoing and therefore could not be set aside by JNOV.


Banaitis v. Mitsubishi Bank, Ltd., 879 P.2d 1288 (Or. Ct. App. 1994)