I.K. v. Banana Republic, LLC.

A plaintiff under Oregon law can sue for negligent infliction of emotional distress where there is emotional harm from physical impact or violation of a legally protected interest. Norwest v. Presbyterian Intercommunity Hosp., 293 Or 543, 558-561(1982). A legally protected interest is "an independent basis of liability separate from the general duty to avoid foreseeable risk of harm" and must be "of sufficient importance as a matter of public policy to merit protection from emotional impact."  Philibert v. Kluster, 360 Or 698, 704-705.  The emotional distress must also be one that could have been foreseeable result of the violation of the protected interest. Id. 

Plaintiffs, former Banana Republic employees, appealed the dismissal of their claim against Banana Republic on the basis that they had failed to state a claim. Plaintiffs claimed emotional trauma after being recorded at work in the restroom. After Johnny Chan was fired from Kaiser Permanente for secretly recording coworkers while they used the restroom, Banana Republic hired Chan, who again began recording employees in a state of undress while using the restroom. A plaintiff under Oregon law can sue for negligent infliction of emotional distress where there is emotional harm from physical impact or violation of a legally protected interest. Norwest v. Presbyterian Intercommunity Hosp., 293 Or 543, 558-561(1982). A legally protected interest is "an independent basis of liability separate from the general duty to avoid foreseeable risk of harm" and must be "of sufficient importance as a matter of public policy to merit protection from emotional impact."  Philibert v. Kluster, 360 Or 698, 704-705.  The emotional distress must also be one that could have been foreseeable result of the violation of the protected interest. Id. The court held that "employees have a legally protected interest in being free from the emotional trauma of being secretly recorded as a result of the employer taking no steps to prevent it from continuing to occur."  The court also held, as to the foreseeable question, that Plaintiffs sufficiently alleged that Banana Republic knew or should have known about Chan's termination and the reasons, and the court could not "say that it is an unforeseeable as a matter of law.” Reversed and remanded.