Defendant did not establish that disclosure of memoranda was departure from established standards of business ethics

WRONGFUL DISMISSAL

Defendant did not establish that disclosure of memoranda was departure from established standards of business ethics

Plaintiff was investment professional and was employed by defendant for eight years. Plaintiff was director in defendant’s capital division at time of termination. In performance review plaintiff was rated consistently as above average. Plaintiff had unblemished record of achievement with defendant. Plaintiff provided specific precedents for private placement memoranda (“PPMs”) for distressed debt funds to friend. Plaintiff attended half hour meeting with defendant. Plaintiff had no notice of meeting. At meeting plaintiff was summarily dismissed from his employment with defendant allegedly for cause. Defendant asserted plaintiff breached written Code of Conduct and principles of ethical business dealings in disclosing PPM. Defendant advised team of plaintiff’s departure and told team plaintiff disclosed confidential information memorandum (“CIM”). Defendant considered CIM and PPM to be interchangeable. CIMs and PPMs were marketing documents designed to promote investment interest. Most of information in PPM could be pieced together from other sources and market research, but most of sensitive information in CIM was not available in public domain and could not be obtained through legitimate market research. Plaintiff did not consider PPM confidential. Plaintiff asserted defendant never treated PPMs as private confidential documents; never signed confidentiality agreements in respect to PPMs; and treated them much like prospectus, which was publicly filed document. Plaintiff sought damages. Claim allowed. Plaintiff’s employment was terminated without cause and appropriate notice period was 15 months. Defendant did not establish that PPM was confidential. Defendant did not establish that plaintiff breached Code of Conduct in providing PPM to friend. Defendant did not establish that disclosure of PPM was departure from established standards of business ethics. There was no legal cause to termination of plaintiff’s employment without notice. It was not appropriate to sanction defendant with award of aggravated damages. Defendant made it more difficult for plaintiff to find alternative employment, delayed his re-employment and contributed to conditions that led plaintiff to take employment in China. Plaintiff discharged his duty to mitigate damages.
Lin v. Ontario Teachers’ Pension Plan Board (Jun. 1, 2015, Ont. S.C.J., D.L. Corbett J., File No. CV-11-430085) 254 A.C.W.S. (3d) 113.