Gordon & Rees San Francisco and Los Angeles partner Mollie Burks, assisted by associate Sara Moore, recently won a complete defense arbitration award on behalf of their client, a Bay Area-based glass recycling company in a lawsuit brought by its founder and former CEO.
Following his removal as CEO and separation from employment at the company, the claimant sued, alleging breach of employment contract, fraud and various wage and hour-based claims, including waiting time penalties for accrued vacation pay and salary cuts. The claimant sought nearly $400,000 in damages, plus penalties, interest and attorney’s fees.
On cross-examination at the arbitration hearing, Burks elicited several key admissions from the claimant, including his agreement that the plain language of the employment contract did not guarantee him any bonus and that he was neither promised nor earned the claimed bonuses under the terms of the employment contract.
Further, the arbitrator agreed with the company’s argument that as an owner, member of the Board of Directors, and fiduciary, the claimant’s decision to accept reduced compensation and postponed payment of wages for the good of the company estopped him from asserting waiting time penalties under the Labor Code.
The arbitrator’s Oct. 16 written award found for the company on all eight claims asserted by the claimant.