## Facts

- Steven J. Trzaska was an in-house patent attorney at L’Oréal USA and led a regional patent team responsible for evaluating invention disclosures and filing patent applications.
- As an attorney admitted to practice and before the USPTO, Trzaska was subject to professional ethics rules barring frivolous or bad-faith filings and false statements in adjudicative settings.
- L’Oréal imposed annual quotas for the number of patent applications attorneys were expected to file and indicated that failure to meet quotas would carry negative career or employment consequences.
- L’Oréal also implemented a patent-quality initiative that reduced the number of invention disclosures, leaving the team with fewer inventions it believed were patentable.
- Trzaska told management he and his team would not file patent applications they did not, in good faith, believe were patentable because doing so would violate ethical obligations.
- Management presented Trzaska with severance options and, after he declined and maintained his refusal, terminated his employment.

## Issues

1. Whether a CEPA claim is plausibly stated when an in-house attorney alleges retaliation for refusing quota-driven patent filings he reasonably believed would violate attorney ethics rules, even absent an express order to file frivolous applications.
2. Whether attorney professional-conduct rules and USPTO ethics rules can supply the “law, rule, regulation,” or “clear mandate of public policy” predicate required under CEPA at the pleading stage.

## Decision

- The Third Circuit reversed the dismissal and remanded.
- The court held the complaint plausibly alleged that the ethics rules invoked could qualify as a CEPA predicate as a rule/regulation or clear public-policy mandate.
- The court held CEPA does not require an explicit directive to engage in unlawful or improper conduct; an “activity, policy, or practice” may be inferred from quotas combined with “or else” pressure.
- The court held Trzaska plausibly alleged the elements of CEPA, including protected refusal, adverse action, and a plausible causal connection.

## Legal Principles

- Under CEPA, a plaintiff must plausibly allege: (1) a reasonable belief the employer’s conduct violates a law/rule/regulation or clear public-policy mandate; (2) whistleblowing activity or refusal to participate; (3) an adverse employment action; and (4) causation.
- Professional ethics rules governing attorneys, including USPTO-related ethical duties, can reflect a clear mandate of public policy when tied to honesty and integrity in adjudicative or administrative processes.
- CEPA’s protection can extend to refusals prompted by implicit employer pressure or expectations (including quota regimes), not only explicit commands.
- At the Rule 12(b)(6) stage, CEPA requires plausibility, not proof, and a coherent factual scenario may suffice to proceed to discovery.

## Conclusion

The Third Circuit allowed the CEPA claim to proceed, holding that an in-house attorney plausibly alleged retaliatory discharge for refusing to meet patent-filing quotas in a manner he reasonably believed would require unethical patent submissions, even without an express instruction to violate ethics rules.


Trzaska v. L'Oréal USA, Inc., 865 F.3d 155 (3d Cir. 2017)