Crawford: Resume Fraud and the After-acquired Evidence Doctrine

• Publication year: 1998
• Pages: 65
• Citation: Vol. 27 No. 1 Pg. 65

27 Colo.Law. 65 Colorado Lawyer 1998.

1998, January, Pg. 65. Crawford: Resume Fraud and the After-Acquired Evidence Doctrine

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65

Vol. 27, No. 1, Pg. 65

The Colorado Lawyer
January 1998
Vol. 27, No. 1 [Page 65]

Specialty Law Columns
Labor and Employment Review
Crawford: Resume Fraud and the After-Acquired Evidence Doctrine
by Mark L. Sabey

In its recent opinion in Crawford Rehabilitation Services v Weissman,1 the Colorado Supreme Court took its first look at the after-acquired evidence doctrine. This doctrine is a powerful consideration in every wrongful termination case because it can utterly destroy an employee's otherwise promising case. The after-acquired evidence defense allows employers to use evidence of misconduct by an employee that was not discovered until after the employee's termination to establish a partial or total defense to the employee's wrongful termination claims. The defense applies even though the employee's claim is assumed valid, and even though the employee's misconduct may have been discovered only as a result of the employee's lawsuit-that is, during discovery

By adopting this doctrine, the Colorado Supreme Court has ensured that evidence of previously undiscovered misconduct or resume fraud2 will be the subject of crucial inquiry by plaintiffs' counsel in deciding whether to take an employee's case and by defense counsel during discovery The Crawford case sets the initial parameters of the after-acquired evidence doctrine in Colorado law.

Background Facts Of Crawford

The respondent in Crawford, Weissman, worked for the Association of Operating Room Nurses ("AORN") from 1980 to 1985 and was discharged for performance problems. Later, when she applied for a job with Crawford Rehabilitation Services ("Crawford"), Weissman omitted her employment with AORN when completing the employment history section on the application. She filled in the gap by falsely listing another business as her full-time employer during that period. In addition, she lied when she stated that she had never been terminated by any prior employer.

Relying, in part, on her employment history as reflected on her application, Crawford hired Weissman as a clerical typist in mid-1988. After Weissman had worked for Crawford for approximately eighteen months, a number of performance and attitude issues came to a head when she requested permission to take a personal holiday. Her supervisor denied the request based on prior absenteeism problems and company policy requiring employees to schedule personal holidays at least two weeks in advance. Weissman told her supervisor that she was taking the day off anyway, and then followed through on her threatened insubordination. She was discharged when she returned to work.

Weissman sued Crawford, alleging four causes of action: breach of implied contract, promissory estoppel, outrageous conduct, and wrongful discharge in violation of public policy. Prior to answering the complaint, Crawford's counsel deposed Weissman and discovered the misrepresentations and omissions on her application documents. Rather than answering the complaint, Crawford filed a motion to dismiss, which was ultimately granted by the trial court. The outrageous conduct claim was dismissed based on a failure to state a claim and on the workers' compensation exclusive remedy defense. The remaining claims were dismissed based on after-acquired evidence of resume fraud.

The Court of Appeals affirmed the trial court's dismissal of Weissman's outrageous conduct claim, but reversed as to all other claims and remanded for further proceedings.3 The Court of Appeals ruled that Weissman's resume fraud could completely bar her claims for breach of implied contract and promissory estoppel if Crawford reasonably relied on Weissman's misrepresentations. The Court of Appeals also ruled that Weissman had stated a valid claim of public policy wrongful discharge and, relying on McKennon v. Nashville Banner Publishing Co.,4 that Weissman's resume fraud was only a partial defense to that claim.

The Supreme Court's Holding in Crawford

The Colorado Supreme Court held in Crawford that after-acquired evidence of resume fraud is an absolute defense to an employee's claims of breach of contract or promissory estoppel, despite the U.S. Supreme Court's ruling in McKennon that after-acquired evidence of post-hire misconduct is only a partial defense to federal discrimination claims. The Crawford court, which concluded that McKennon neither governed nor conflicted with its holding, distinguished McKennon based on the fact that public policies underlying federal antidiscrimination laws were not present in Weissman's contractual and equitable claims The court also buttressed its opinion by relying on well-established common law principles of fraud in the inducement, rescission, and unclean hands. The Colorado Supreme Court ruled that Weissman did not state a valid claim of public policy wrongful discharge and, consequently, reserved for another day the issue of whether the...