Infosys Visa Fraud: Judge Dismisses Whistleblower Suit

Earlier this week, Judge Thompson of federal court for the Middle District of Alabama rejected all claims brought by Jack Palmer against his employer, Infosys. Palmer claimed to have been harassed and retaliated against after making allegations that Infosys’ massive B-1 visa program was used fraudulently in place of more appropriate visas.   

By way of background, when these allegations first arose in early 2011, I wrote about the strong likelihood that Infosys may have been engaging in a perfectly legal action under existing U.S. immigration law on B-1 visas.  Subsequently, Senator Chuck Grassley (R-IA), apparently motivated by Palmer’s Testimony, addressed a strongly worded but poorly researched memo to Secretary Hillary Clinton in which he demanded a complete review of the B-1 visa. His request was inexplicably granted, and the resultant changes substantially injured the economic interests of U.S. organizations engaged in international trade, countermanded congressional intent on the subject, and escalated denials for B-1 applicants at U.S. Consulates, especially those in the 'B-1 in lieu of H-1B' category.

Returning to the court's decision: It was interesting to note that despite all the recent attention on various states’ interpretation of federal immigration law, Judge Thompson avoided the topic entirely: “Palmer’s brief spends an inordinate amount of time addressing whether Infosys engaged in visa fraud.  To be clear, this litigation does not concern whether Infosys violated American immigration law. Rather, Palmer’s suit rises and falls on a simple inquiry: whether he has created a genuine dispute of material fact on his state-law claims.”

Moving to a discussion on Alabama state law, Judge Thompson highlighted the Alabama Supreme Court’s standing opinion that”[t]he bedrock principle of Alabama employment law is that, in the absence of a contract providing otherwise, employment in this state is at-will, terminable at the will of either party. Under this doctrine, an employee may be discharged for any reason, good or bad, or even for no reason at all.”

The court indicated that unless Palmer was able to prove the existence of “statutory exceptions,” such as worker’s compensation restrictions or an actual or implied contract (an employee handbook provision, for example, that created a unilateral contract), he could, like any similarly at-will employee in Alabama, be legally demoted, denied a promotion, or otherwise adversely treated for any reason, good or bad, or even for no reason at all.

All six of Palmer’s claims were ultimately rejected by the court: his claim of ‘breach of contract’ was denied because the court determined that he was “… not entitled to any specific bonus amount in any year.”  Palmer’s claim of "intentional infliction of emotion distress" and "fraudulent misrepresentation," were rejected due to a lack of evidence in the record and, finally, his claims alleging "negligence and wantonness" and "negligent hiring, training, monitoring, and supervising" were also rejected because the court held that Alabama tort law does not recognize an independent cause of action for negligently or wantonly failing to prevent whistleblower retaliation.

Infosys, still facing an onerous federal investigation stemming from Palmers's (now dismissed) allegations, released an optimistic statement after the court's decision: “Today’s decision confirms what we have been saying from the beginning: Mr. Palmer’s claims of retaliation were completely unfounded. This is a company built on core values that include leadership by example, integrity and transparency. Those values always have and will continue to shape the way we do business with our clients and, without exception, the way we treat our people. We are pleased to consider this matter officially closed.”