$1.1 Million in Attorneys’ Fee for Former Employees
February 24th, 2012 by JBWK
In a move that hopefully will inspire employers to be careful when lodging complaints against former employees, the Fourth Circuit upheld a $1.1 million award of attorneys’ fees and costs to four former employees.
Wachovia Securities (now part of Wells Fargo Advisors) filed arbitration proceedings against four former brokers who left for a competing firm, accusing them of stealing documents and sensitive information. Wachovia apparently fell far short of proving any misappropriation, and the arbitrators awarded the four employees over one million dollars in attorneys’ fees and costs they incurred as a result of the arbitration.
The Fourth Circuit upheld the award of fees and costs on appeal. Given arbitrators’ wide latitude and the increasing use of mandatory arbitration provisions for employment disputes, this should serve as a warning to employers that arbitration is not the solution for an otherwise bad case.
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