Allstate loses bid to sue whistleblower who alleged policy discrimination

TORONTO — An insurance company was trying to stifle criticism when it sued a former employee who alleged the corporation was discriminating against visible minority drivers, an Ontario court has found.

In dismissing a $700,000 counterclaim against Medha Joshi, the judge ruled Allstate Insurance Company of Canada had run afoul of legislation that protects whistleblowers and the media when they raise matters in the public interest.

The issue, according to Superior Court Justice Jessica Kimmel, was whether Joshi was able to talk freely and publicly about her concerns related to Allstate’s allegedly discriminatory sales practices.

“(They are) the same sales practices that she says she resisted implementing and that resulted in her being fired,” Kimmel said. “This is a matter of public interest.”

Joshi had spent almost six years with Allstate as a manager when she was fired last October from her $165,000 position, prompting her to sue for wrongful dismissal. Joshi, 38, sought a total $600,000 in compensation and damages.

In her claim, Joshi alleged Allstate discriminated against drivers in Brampton, Ont., which has a large visible minority. She and her lawyer also spoke to the media about her claim and allegations. Allstate, which alleged the comments were false and malicious, sued her for defamation.

Allstate further issued a counterclaim in which it demanded Joshi repay her termination compensation. The company also sought $700,000 in damages. Among its assertions, court records show, Allstate argued Joshi had gone public with false and damaging claims about its business practices in Brampton.

For her part, Joshi invoked Ontario’s “anti-SLAPP” legislation, which bars what are called strategic lawsuits against public participation. Allstate’s lawsuit, she said, was an attempt at limiting her freedom of expression and involvement in discussion of an issue of public importance. 

Kimmel agreed, saying Allstate was simply trying to gag her.

“The public interest in the expression of all parties with knowledge, information or belief on this subject outweighs any harm or potential harm to Allstate,” Kimmel said. “There is no evidence of malice or any intentional dishonesty or ulterior/improper motivation on the part of Ms. Joshi.”

The judge faulted the company for trying to draw a line between what Joshi avers in her wrongful dismissal suit and what she told the media. Kimmel also said she was troubled by the “cavalier attitude” Allstate displayed in part of its counterclaim.

The company, Kimmel said, had failed to show Joshi’s allegations had in fact caused it any significant harm.

Joshi’s lawyer Andrew Monkhouse said the ruling expands whistleblower protection in the private sector, especially when it comes to issues of human rights abuses.

“Corporations cannot intimidate employees who have spoken out about wrongdoing by using outrageous counterclaims,” Monkhouse said in a statement.

Allstate’s general counsel dismissed the ruling as preliminary and procedural, but said the company was considering an appeal.

“Note that this is not a decision on the merits of Ms. Joshi’s baseless allegations,” Angie Morris, a vice-president, said in an email. “Allstate will continue to rigorously defend our good name and reputation as a champion of inclusion and diversity.”

Kimmel rejected Joshi’s claim for damages over and beyond the costs of fighting the counterclaim on the grounds that she had failed to show the company’s action was in bad faith or for an improper purpose. The justice did warn that her decision did not give Joshi “free licence” to say whatever she wants about Allstate. 

Colin Perkel, The Canadian Press