Most businesses need work to be performed on a schedule, and this can be especially true in the entertainment industry, with its opening nights and “the show must go on” tradition.

But what if an employee is asked to meet a deadline by taking shortcuts that may endanger the public and other workers, refuses, and is fired?

That was the issue at the core of a case recently decided by the California Court of Appeal (Zirpel v Alki David Productions.)

In 2013, Karl Zirpel joined ADP, a Los Angeles-based entertainment company owned by its principal, Alkiviades David. Zirpel became expert in staging ADP’s hologram productions for TV shows, concerts, and museums. That included installing the equipment and managing the technology. He rose to the position of vice president of operations, at a salary of nearly $73,000.

In September of 2017, Zirpel began work at a church on Hollywood Boulevard that ADP was converting to a theater for hologram productions. The building had no restrooms, fire exit signs, ADA-compliant ramps, or drywall. The hologram equipment was in storage.

On September 25, four Los Angeles City inspectors arrived and conducted four separate walk-through inspections of the theater, accompanied by ADP’s in-house counsel and its general contractor. All four found code deficiencies that required correction, and disapproved of work that had already been done. Zirpel was told of 20 code violations, including plumbing and electrical problems.

Zirpel asked two of the inspectors whether ADP could get the required approvals before a performance at the theater scheduled for September 28th. Both said that was not possible, given the amount of work required and their own work schedules. Zirpel later testified that he was especially concerned about whether the ceiling could support the 700 pounds of projection equipment that was to be installed directly over the audience.

According to court filings, after the inspectors left, ADP owner David ordered the construction crew to cover exposed wiring with sheets of plywood that would be painted black and covered with drapes.

The following day Zirpel told a senior ADP executive about his concerns that the theater posed fire and other safety risks to ADP employees and the public. He phoned the agency later that day.

On September 27, the day before the scheduled event, Zirpel and another ADP executive met with a Los Angeles County Fire Inspector, who briefly looked at the building, ordered all work stopped, and told everyone to leave.

The inspector reminded them of the Oakland Ghost Ship warehouse fire 10 months earlier that killed 36 people. If anyone was injured at the theater, the inspector said, Zirpel and other ADP employees could be prosecuted.

Zirpel left to retrieve the hologram equipment from storage and returned to find extensive work underway at the theater. He texted about his concerns to Manuel Nelson, ADP’s in-house counsel, and David, the CEO. Both responded that the work must continue. “The permits will be given tomorrow morning,” David texted. “Nothing stops.”

Zirpel told the work crew he was concerned about installing the heavy hologram equipment in the absence of approvals for the construction. The work should stop, he said, because it was unsafe and it was “our job and responsibility to say so.”

When David arrived shortly afterward and found the work halted, he “immediately blew up,” according to court documents. When Zirpel said what they were doing was not safe, according to these filings, David went into a “fit of rage,” yelled in Zirpel’s face, and using numerous obscenities, told Zirpel to “get the f*** out, you faggot.” He then told Zirpel he was fired.

David was standing so close, Zirpel testified, he could feel David’s spittle flying against his face.

Zirpel handed David the keys to the equipment truck and left the theater. As he did so, David told him to “suck my dick.” After a brief interval, David tried to embrace Zirpel and apologize. Zirpel rejected the apology.

Nelson, the attorney, oversaw the renovation and later testified that he received a special event permit for the September 28 performance, which was held on that date.

Zirpel sued ADP on November 27, 2017, saying his termination constituted retaliation under California labor laws, which grant “whistleblower” protection for employees who disclose violations of laws or regulations, or about unlawful working conditions.

A jury found in Zirpel’s favor. It awarded him $368,000 in economic damages, $700,000 in non-economic damages, and $6 million in punitive damages.

ADP asked the trial court to reconsider the verdict, but its request was denied. It then appealed.

In its appeal ADP argued that continued installation of the hologram equipment would not have violated any law, that the trial court had made several errors, and that the punitive damages award was unconstitutionally excessive.

The appellate justices noted that California’s labor state states: “An employer, or any person acting on behalf of the employer, shall not retaliate against an employee for refusing to participate in an activity that would result in a violation of state or federal statute, or a violation of or noncompliance with a local, state, or federal rule or regulation.”

Although ADP claimed it had a permit for the September 28, 2021, event, the justices pointed out that the document it presented in court was printed on October 7, 2021. They also said there was “substantial evidence of multiple other municipal code violations” which supported Zirpel’s view that continued work at the theater would have violated the law.

After refusing to provide the trial court with information about its financial condition, they said, ADP cannot now complain about the size of the punitive damages award. Moreover, because of the “reprehensibility” of David’s treatment of Zirpel, the roughly six-to-one ratio of punitive damages to compensatory damages is not excessive, they said.

The justices affirmed the lower court’s ruling and awarded Zirpel his costs on appeal.

By Laurie Murphy