Accettola v. He

Background

Hong Danielle Accettola sued Linda Mei He, WL Global Corp., We Education Group, Inc., and Wailian Overseas Consulting Group Ltd. She alleged that the defendants terminated her employment in retaliation for complaints about suspected insurance fraud, banking fraud, immigration fraud, labor fraud, and improper conduct involving Paycheck Protection Program loans. Her claims were based on Section 740 of the New York Labor Law, which protects certain employee disclosures. She also asserted claims for intentional and negligent infliction of emotional distress.

The defendants denied employing Accettola, denied engaging in fraud, and denied that her termination was retaliatory. They alleged that Accettola had improperly benefited from WL Global’s assets and asserted counterclaims for fraud, breach of fiduciary duty, breach of the duty of loyalty, unjust enrichment, and conversion.

The case was tried to the court on February 18, 2025, with Accettola as the only witness. The court treated its findings as findings of fact and conclusions of law under Federal Rule of Civil Procedure 52(a)(1).

Whistleblower-retaliation claim

The court applied the version of Section 740 that was in effect when Accettola was terminated on November 5, 2021. That version required her to show that she disclosed conduct that actually violated a law, rule, or regulation and that created a substantial and specific danger to public health or safety. The court held that the 2021 amendment to Section 740, which broadened protection to disclosures based on an employee’s reasonable belief, did not apply retroactively. The amendment took effect on January 26, 2022, after Accettola’s termination.

The court found that Accettola did not show that the alleged fraud involving the defendants’ finances or Paycheck Protection Program loans created a substantial and specific danger to public health or safety. The court therefore held that her whistleblower claim failed. It also held that the claim would fail for lack of causation because Accettola did not prove that the defendants terminated her because of her disclosures. The court noted that she had made earlier objections without suffering retaliation, more than three months passed between her last reported disclosure and her termination, and He offered her a consulting position on the day she was terminated.

Emotional-distress claims

The court rejected Accettola’s intentional-infliction-of-emotional-distress claim because she did not identify conduct that was sufficiently extreme and outrageous. The court also found no evidence of severe emotional distress supported by medical evidence. Accettola testified that she did not seek medical or mental-health treatment and instead used ordinary ways to relax, including taking Tylenol.

The court rejected the negligent-infliction-of-emotional-distress claim because Accettola presented no evidence that the defendants’ conduct implicated her physical safety. Under New York law, such a claim generally requires a special duty or conduct involving danger to, or fear for, the plaintiff’s physical safety.

Defendants’ counterclaims

The defendants’ counterclaims rested primarily on Accettola’s use of company credit-card points and her inability to produce receipts for some reimbursement requests. The court credited Accettola’s testimony that He authorized her use of the points. It also found that the absence of older receipts did not prove that her reimbursement requests were improper. The defendants did not show that Accettola made a misrepresentation, breached a duty, was unjustly enriched, or took property belonging to them.

Disposition

The court dismissed Accettola’s claims. The court dismissed the defendants’ counterclaims. The Clerk of Court was directed to enter judgment and close the case. The opinion does not state whether either dismissal was with or without prejudice.