A former Deere & Co. factory manager cannot sue the company under the Iowa Civil Rights Act because he worked and lived in China when he was disciplined for having sexual relationships with two Chinese woman also employed by the company, the Iowa Supreme Court said Friday.

The ruling establishes for the first time that the Iowa Civil Rights Act does not apply to circumstances that occur outside the state even though the parties involved may have some Iowa connection. The decision means the lawsuit filed by Matthew Jahnke will be dismissed.

Jahnke, who began working for Deere in 1998, took a job with the company in Harbin in the northeast part of China in 2011 to oversee the construction of a new factory and to manage it once completed.

In April 2014, Deere received internal reports that one of Jahnke's employees had "procured several very expensive luxury cars" for Jahnke, and helped Jahnke "find beautiful women" in exchange for favorable performance reviews. The reports prompted an investigation that revealed Jahnke had sexual relationships with two Chinese women who also worked at the Deere Harbin factory.

The company concluded that Jahnke violated its code of business conduct because he failed to timely disclose sexual relationships with women he managed.

The Deere employee responsible for the initial investigation concluded in his report that Jahnke, a 60-year-old man involved in a sexual relationship with a 28-year-old woman, could cause embarrassment and negative perception for the company and "there could be the obvious perception of an oldish factory manager abusing his influence/position—and create (sic) some possible exposure for the company."