MAY 31, 2016 Shannon Hall and Timothy Ross The Plaintiffs

STATE OF CONNECTICUT
SUPERIOR COURT
RETURN DATE:
MAY 31, 2016
JUDICIAL DISTRICT OF HARTFORD
Shannon Hall and Timothy Ross
AT HARTFORD
The Plaintiffs,
v.
Nutmeg State Financial Credit Union and:
John Holt,
March 31, 2016
The Defendants.
COMPLAINT OF SHANNON HALL AND TIMOTHY ROSS
I.
PARTIES
1.
Plaintiff Shannon Hall at all times relevant to this complaint was an adult resident
of Connecticut, residing at 400 Coldspring Road, D404, Rocky Hill, Connecticut.
2.
Plaintiff Timothy Ross at all times relevant to this complaint was an adult resident
of Connecticut, residing at 197 Foxboro Drive, Newington, Connecticut.
3.
Defendant Nutmeg State Financial Credit Union (hereinafter "NSFCU") is a
member-owned, not-for-profit state chartered credit union with its primary place
of business at 521 Cromwell Ave, Rocky Hill CT 06067-0066. Defendant
NSF CU has approximately 37,954 members, assets of over $10 million and is
governed by Conn. Gen. Stat. §§ 36a-435 et. seq. Defendant NSFCU is regulated
by the Connecticut Department of Banking and the National Credit Union
Administration (hereinafter "NCUA"), an agency of the United States
government.
1
4.
Defendant NSFCU's stated mission is "to make a positive difference in our
members' lives while ensuring organizational and financial soundness."
5.
Defendant John Holt is an adult resident of West Hartford, Connecticut. At all
times relevant to this complaint, Defendant John Holt has been employed as the
President/Chief Executive Officer of Defendant NSFCU. As CEO, Defendant
Holt exercised full authority and control over the day to day operations of
Defendant NSFCU.
6.
At all times relevant to this complaint, Plaintiff Shannon Hall was employed by
Defendant NSFCU as the Vice President of Lending and was an employee as that
term is used in Conn. Gen. Stat. §§ 31-51 m. Plaintiff Hall was also a member of
Defendant NSFCU.
7.
At all times relevant to this complaint, Plaintiff Timothy Ross was employed by
Defendant NSF CU as the Senior Vice President - Chief Financial Officer or
"CFO," and was an employee as that term is used in Conn. Gen. Stat.§§ 31 -5 1m.
Plaintiff Ross was also a member of Defendant NSFCU.
8.
At all times relevant to this complaint, Defendant NSFCU was an employer as
that term is used in Conn. Gen. Stat. §§ 31-5 lm. It employs approximately 80
employees.
II.
FACTS
9.
Conn. Gen. Stat.§§ 36a-435 et. seq. governs the formation and functioning of
credit unions operating pursuant to a state charter. Specifically, Conn. Gen. Stat. §
36a-440b( d) requires that all Connecticut credit unions "establish and maintain
records, accounting systems and procedures which accurately reflect its
2
operations and which enable the commissioner to readily ascertain the true
financial condition of the credit union and whether such credit union is
complying with sections 36a-435a to 36a-472a, inclusive." (emphasis added) The
purpose of these laws is to protect members of the public and ensure the viability
and soundness of Connecticut's financial institutions.
10.
Additionally, in accordance with federal law, credit unions whose assets are
insured by the NCUA and are in excess of $10 million, must maintain and file
financial reports that meet specific filing criteria. 12 U.S.C. § l 782(a)(6)(C); 12
C.F.R. § 741.6. The purpose of these rules is to protect consumer rights in
general and member deposits specifically, as well as ensure the soundness of
credit unions.
11.
Defendant NSFCU is governed by an eight-member Board of Directors.
12.
In addition to the Board of Directors, and pursuant to state and federal law,
Defendant NSFCU must maintain a Supervisory Committee that consists of one
board member and two non-board members. Beth Bunko is the current
chairperson of the Supervisory Committee. As set out in Conn. Gen. Stat. § 31 451 , the Supervisory Committee is "responsible for ensuring that members of
senior management and directors meet required financial reporting objectives and
establish practices and procedures sufficient to safeguard members' assets" as
well as ensure that these policies and procedures are "sufficient to safeguard
against error, carelessness, conflict of interest, self-dealing and fraud."
3
13.
As a state and federally regulated credit union with assets of over $10 million,
Defendant NSFCU is required to adhere to the Generally Accepted Accounting
Principles, known as "GAAP." 12 U.S.C. § 1782(a)(6)(C); 12 C.F.R. § 741 .6.
14.
GAAP refers to the accounting standards that have been developed and
established by the Financial Accounting Foundation's standard setting Boardsthe Financial Accounting Standards Board and the Governmental Accounting
Standards Board. GAAP applies to the financial reporting of an organization,
including the financial position, operations and disclosures made by that
organization. Inherent in GAPP' s requirements is that those managing credit
unions operate with transparency and accuracy.
15.
On or about July 12, 2015, Timothy Ross began his employment as Senior Vice
President - Chief Financial Officer for Defendant NSFCU. Prior to joining
NSFCU, Mr.Ross had over twenty-three (23) years of experience working in the
banking industry, over thirteen (13) of which included work as a CFO at other
financial institutions.
16.
Throughout the course ofhls employment, Defendant Holt was Mr. Ross' direct
supervisor.
17.
Soon after becoming CFO, Mr. Ross observed that Defendant NSFCU engaged in
questionable business practices, particularly as it pertained to accurate reporting
of assets and loan losses. Mr. Ross believed these practices were inconsistent with
the state and federal reporting requirements set out above.
18.
On or about October 5, 2015, Defendant NSFCU hired Shannon Hall as Vice
President of Lending. Prior to joining Defendant NSFCU, Mr. Hall had over
4
seventeen years of experience working in the banking industry, primarily as thirdparty auditor for other financial institutions, three of which were credit unions.
19.
Throughout the course of his employment at Defendant NSFCU, Mr. Hall
reported directly to Mr. Ross.
20.
On information and belief, Defendant Holt had a compensation package that
included an annual salary, bonuses and a Supplemental Executive Retirement
Plan, known as a SERP. Defendant Holt negotiated this package through a
compensation advisor who advocated on his behalf, but was paid for by
Defendant NSFCU. On information and belief, it cost in excess of $45,000
monthly for Defendant NSFCU to fund Defendant Holt's SERP.
21.
On information and belief, in addition to the SERP plan, Defendant Holt' s
compensation included bonus payments that were paid if certain profit targets
were met. This led to conflict between Defendant Holt and the plaintiffs as
Defendant Holt would encourage accounting practices that had the sole purpose
of maximizing Defendant NSFCU short term earnings, to ensure that Defendant
Holt's bonus targets were met. Not only were these practices not in the best
interests of the members of Defendant NSFCU but the plaintiffs believed that
these practices were inconsistent with GAAP and contrary to state and federal
law.
22.
The terms and value of Defendant Holt's compensation package, and in
particular, the terms of the SERP were excessively high for an institution of the
size of Defendant NSFCU.
5
23.
Mr. Ross soon became aware that the individual who negotiated the SERP on
Defendant Holt's behalf was also the primary advisor to Defendant NSFCU' s
board as to the value of the assets supporting Defendant Holt's SERP. Upon
learning of the arrangement, Mr. Ross developed concerns about this lack of
impartiality regarding the valuation of these assets.
24.
As VP of Lending, one of Mr. Hall' s duties was to manage Defendant NSFCU's
"Allowance for Loan and Lease Losses," known as "ALLL." According to
Defendant NSFCU's policy, the ALLL is "a credit union' s best estimate of the
probable amount of loans and leases that it will be unable to collect based upon
current information and events." Defendant NSFCU' s policy requires that the
accounting that is done regarding the ALLL must conform to GAAP.
25.
GAAP required that, as soon as Defendant NSFCU determined that it would be
unable to collect on a specific loan, it must record the loss associated with that
loan and fund the ALLL at a high enough level to include the loss within that
month. Failure to do so provides an inaccurate picture of the financial condition of
the financial institution, in contravention of Conn. Gen. Stat. §36a-440b(d), 12
U.S.C. §1782(a)(6)(C)(i) and 12 C.F.R. §741.6.
26.
In his role as VP of Lending, Mr. Hall met with Defendant NSFCU's collection
manager Thomas Madden on a bi-weekly basis to review troubled loans, loans
that NSFCU may have to foreclose on and other potential losses.
27.
After reviewing these losses, Mr. Hall would discuss this information with Mr.
Ross and Defendant Holt, in order to determine the proper provisions for the
ALLL. Defendant NSFCU's policy mandated that Mr. Ross, as CFO and
6
Defendant Holt, as CEO, determine the appropriate monthly provision for the
ALLL but Defendant Holt had final authority over the funding level.
28.
However, on multiple occasions, Defendant Holt refused to allow Mr. Hall to
make the proper provision for the ALLL, by instructing Mr. Hall to push the loss
out to some future date, rather than record the loss within that month, as required
by GAAP. These conversations happened multiple times per month. For
example, on January 5, 2016, Mr. Hall disclosed several loans that were in danger
of default, and for which GAAP required proper provisions be made in the ALLL.
However, when Mr. Hall informed Defendant Holt of these loans, Defendant Holt
instructed him to postpone any action so that Defendant NSFCU would not have
to take the loss.
29.
By pushing out the losses, Defendant Holt was able to keep Defendant NSFCU' s
profits artificially inflated, which allowed his bonus and SERP to be funded, even
in months when Defendant NSFCU' s profit targets would have fallen short, and
also at the expense of proper reporting practices and against the interests of
Defendant NSFCU' s members and the public in general. Indeed, based upon
Defendant Holt's manipulations, the true condition of Defendant NSFCU was
concealed, in violation of state and federal law, to the detriment of the credit
union and its members but to the benefit of Defendant Holt.
30.
Despite Conn. Gen. Stat. § 36a-440b(d) clear requirement that Defendant NSFCU
"establish and maintain records, accounting systems and procedures which
accurately reflect its operations and which enable the commissioner to readily
ascertain the true financial condition of the credit union," it became clear to
7
Plaintiffs Hall and Ross that Defendant NSFCU' s reporting practices, as dictated
by Defendant Holt, were directly in contradiction of this statutory requirement.
31.
In addition to these fraudulent reporting practices, Mr. Ross also complained to
Defendant Holt regarding Defendant NSFCU's valuation of two different pieces
ofreal estate. First, he complained about the treatment of the finances related to
the closing of Defendant NSFCU's East Windsor facility, because GAAP
required that the expense in discontinuing that location be recorded as soon as the
facility closed. Defendant Holt refused and required him to stretch the expenses
out. As a result, the September 30, 2015 Call Report, which is a report that the
NCUA requires all members credit unions to file, was inaccurate.
32.
Mr. Ross also complained to Defendant Holt that the value of the Glastonbury
facility was overstated by approximately $1 million dollars, based upon
Defendant NSFCU ' s own appraisal. As soon as Defendant NSFCU became
aware that the asset was overvalued, it should have been recorded. Defendant Holt
refused to let Mr. Ross record the property at its appropriate valuation, in
violation of state and federal law.
33 .
During November of 2015, Defendant NSFCU underwent its "Annual Safety and
Soundness Examination," conducted by the Connecticut Department of Banking
and the NCUA. This review was required by state and federal law. According to
the NCUA's website, the primary purpose of this examination "is to ensure the
overall safety and soundness of the credit union system."
34.
In addition to the review of credit union policies and practices, pursuant to the
NCUA examiner's guide, executive compensation of management officials is an
8
area that NCUA examiners are instructed to review as part of this annual
examination, to ensure that a credit union is not engaging in unsafe or unsound
practices that could lead to a material financial loss or damage.
35.
As CFO and VP of Lending respectively, both Mr. Ross and Mr. Hall played a
substantial role in this examination, which included frequent contact with the
regulators as well as the provision of information regarding Defendant NSFCU' s
practices and procedures regarding its financial reporting.
36.
Prior to the review, Mr. Hall and Mr. Ross instructed their subordinates to
cooperate with the examiners, and to answer their questions honestly and further,
Defendant NSFCU's staff explained that they had been instructed in the past to
not answer any of the regulators' questions. Further, during a planning meeting
for the review with the management team, Defendant Holt told senior staff,
including Mr. Hall and Mr. Ross, that "communications and interactions" with the
examiners "should be held to a minimum" and "do not offer any information
beyond what is absolutely required." Defendant Holt's instructions violated state
and federal reporting laws as well as the NCUA policy requiring full cooperation
by insured credit unions in NCUA examinations.
37.
Defendant Holt concealed information from the regulators through Defendant
NSFCU's consistent and unlawful past practice of underfunding the ALLL, overvaluing certain assets and overstating short term earnings, in an attempt to prevent
the regulators from scrutinizing Defendant NSFCU, its financial reporting or his
own compensation package, in violation of state and federal law.
9
38.
As part of the annual review, examiners from both the Connecticut Department of
Banking and NCUA did express concerns to Mr. Ross regarding the size of
Defendant Holt's compensation and benefit plan (both bonus and SERP) and its
effect on Defendant NSFCU' s finances.
39.
In approximately mid-December 2015, during a meeting with Defendant Holt and
senior management, the examiners discussed some of their concerns with
Defendant Holt' s compensation and SERP as well as its potential negative effect
on Defendant NSF CU finances the lack of independence between Defendant
NSFCU' s board of directors, Defendant Holt and Defendant Holt's compensation
advisor, who not only negotiated with the Board on Holt' s behalf but was also the
investment advisor and administrator of the underlying SERP investment. The
meeting did not get very far until Defendant Holt ended it, indicating that he did
not want to discuss his compensation in front of senior management. The
examiners noted that the hiring of Mr. Hall and Mr. Ross were the only positives
for an otherwise difficult review, indicating that both Mr. Hall and Mr. Ross not
only had " good heads on their shoulders" but also were "both looking out for
membership."
40.
On or about January 5, 2016, Mr. Ross complained via email to Defendant Holt
that two investments were being improperly overstated in violation of Conn. Gen.
Stat. 36a-440(b)(d),12 U .C.S. §I782(a)(6)(C)(i) and 12 C.F.R. § 741.6.
Defendant Holt informed Mr. Ross via email that "there was no need for his
further input" and, as he had done in the past, Holt refused to comply with the
reporting requirements.
10
41.
Additionally, on the evening of January 5, 2016, Mr. Hall and Mr. Ross conferred
regarding the ALLL for December and determined that the funding requirement
should be in the vicinity of $400,000. Defendant Holt responded via email that
this amount was very concerning to him and did not agree to this funding.
42.
At approximately 8:30 am on January 6, 2016 - the very next morning- per
Defendant Holt' s instructions, Mr. Hall was terminated. Tracie Rodriguez,
Defendant NSFCU's Human Resources representative told Mr. Hall that the
reason for his termination was, at least in part, because he was not a "cultural fit"
for Defendant NSFCU.
43.
Mr. Hall had violated no workplace rule and, at no point during the prior ninety
(90) days, had anyone at NSFCU indicated that he did not fit the culture.
Moreover, at no time during the preceding ninety (90) days had Mr. Hall ever
been disciplined.
44.
Shortly after Mr. Hall was fired, at approximately 8:50 am, Defendant Holt called
Mr. Ross into a meeting.
45.
Defendant Holt started this meeting by telling Mr. Ross that he had just fired Mr.
Hall. Despite the fact that Mr. Ross was Mr. Hall' s direct supervisor, no one had
consulted Mr. Ross prior to firing Mr. Hall.
46.
Defendant Holt expressed frustration and anger to Mr. Ross regarding Mr. Hall ' s
conduct, telling him that "there were comments made to the examiners [by Hall]
with details about my SERP and that they were allegedly led down a path to look
at it and to scrutinize it." Holt further complained that "then apparently, after
11
they were led [the examiners] down a path about the SERP, about my SERP, my
salary and my bonus, they started really peeling it apart."
4 7.
Defendant Holt also accused Mr. Hall of not being "a team player" because he
had been talking publicly about Holt's SERP, salary and bonus.
48.
Defendant Holt further told Mr. Ross that, while he had told Mr. Hall that he was
not a " good cultural fit" and "wasn't working well as a team" the specific reason
Mr. Hall was fired was because Defendant Holt believed Mr. Hall had discussed
his salary, bonus and SERP with other staff, all of whom were members of the
credit union, which Mr. Holt considered to be a matter between he and the Board.
49.
Defendant Holt then told Mr. Ross that he expected him to assume responsibility
for business lending. Mr. Ross refused and Defendant Holt halted the meeting to
contact Human Resources.
50.
During the intervening time, Mr. Ross sent an email to Beth Bunko, the Chair of
Defendant NSFCU' s Supervisory Committee. In this email, Mr. Ross complained
about a number ofNSFCU' s banking practices and its non-compliance with state
and federal law, concerns that Mr. Ross had previously raised with the state and
federal regulators and with Defendant Holt directly.
51 .
Later that morning, Defendant Holt called Mr. Ross back into his office. At this
time, Human Resources representative Tracie Rodriguez joined the meeting.
52.
During this part of the meeting, Defendant Holt asked Mr. Ross if he could work
with him as a supervisor, given what had occurred with Mr. Hall that morning.
Defendant Holt also stated in words to the effect "the bigger question isn't about
commercial lending, but if you can overcome what happened with Shannon."
12
53.
Mr. Ross refused to accept Hall's workload because Mr. Ross believed that Mr.
Hall had been illegally terminated and he did not want to be complicit in
Defendants Holt and NSFCU's unlawful and retaliatory behavior.
54.
At that point, Ms. Rodriguez stated that she did not think that Mr. Ross could
continue to work with Defendant Holt as his supervisor and Defendant NSFCU
terminated Mr. Ross' employment.
Ill.
LEGAL CLAIMS
COUNT ONE:
1-54.
WRONGFUL DISCHARGE IN VIOLATION OF PUBLIC POLICY
AS TO PLAINTIFF SHANNON HALL AGAINST DEFENDANT
NSFCU
Paragraphs 1-54 of this complaint are incorporated herein and made a part hereof
as though fully set forth.
55.
Connecticut has a clear public policy in favor of transparency and open and
accurate reporting with regard to financial institutions, as well as a clear public
policy that mandates that employees of financial institutions fully cooperate with
state and federal regulators in order to provide a true picture of the soundness of
that financial institution. See, Conn. Gen. Stat. § 36a-44-(b)(d), 12 U.C.S .
§1782(a)(6)(C)(i) and 12 C.F.R. § 741.6. In addition, Connecticut has an
established a public policy that prohibits employers from retaliating against
employees who report fraud and suspect violations of the laws regarding open and
accurate financial reporting, such as the policy set forth in Conn. Gen. Stat. §331336 (Connecticut' s law providing whistleblowing protections for employees of
certain corporations which demonstrates a general public policy in favor of
13
protecting employees who report fraud internally) as well as public policy
prohibiting fraud and self-dealing in its financial institutions, and in favor of
protecting the members of a state-chartered credit union.
56.
As set out more fully above, by terminating Mr. Hall's employment, Defendant
NSFCU has illegally retaliated against Mr. Hall for his open communication with
state and federal regulators as well as his attempts to uncover and expose
Defendant NSFCU' s unlawful behavior and in violation of Connecticut public
policy.
57.
Defendant NSFCU's conduct was done with malice and/or conscious disregard of
the Plaintiff Hall's rights, in that it was done to further Defendant Holt's illegal
scheme to profit personally at the expense of the credit union and its members and
in violation of state and federal laws.
58.
As a direct and proximate result of Defendant NSFCU's retaliatory conduct,
Plaintiff Hall has suffered lost employment, lost wages, lost benefits and other
perquisites of employment, economic losses due to his re-location, damage to his
reputations as well as pain and suffering and attorneys' fees.
COUNT TWO:
WRONGFUL DISCHARGE IN VIOLATION OF CONN.
GEN. STAT. SEC. 31-Slm AS TO PLAINTIFF SHANNON
HALL AGAINST DEFENDANT NSFCU
1-54. Paragraphs 1-54 of this complaint are incorporated herein and made a part hereof
as though fully set forth.
14
55.
During the course of his interactions with the state and federal regulators, Mr.
Hall provided information regarding various bank accounting practices that he
believed violated state and federal reporting requirements, including the
overstating of certain assets and the underfunding of the ALLL to inflate shortterm earnings for Defendant NSFCU, which he believed was done with the
specific purpose of ensuring that Defendant Holt's bonus targets were met, his
SERP funded, and certain information was concealed from the regulators. Mr.
Hall believed that Defendant Holt' s behavior was fraudulent and taken to conceal
from Defendant NSFCU's membership the full extent of the Defendant' s financial
obligations to Defendant Holt. Mr. Hall further believed that this course of
conduct was not in the best interest of the membership or the public.
56.
Mr. Hall's participation in the Annual Safety and Security Review, as well as his
interaction with the state and federal regulators and his complaint about
Defendant NSFCU' s unlawful financial reporting practices is protected conduct
pursuant to Conn. Gen. Stat. § 31-5 lm in that it constituted a report by Hall to a
public body of a suspected violation of the laws that govern Connecticut chartered
credit unions.
57.
As set out more fully above, Defendant NSFCU has illegally retaliated against the
Plaintiff Hall because he engaged in activity protected by Conn. Gen. Stat.§ 31 51m.
58.
Defendant NSFCU had knowledge of Plaintiff Hall's protected conduct.
59.
In retaliation for Plaintiff Hall' s open participation in this process, Defendant
NSFCU terminated his employment, in violation of Conn. Gen. § 31 -5 lm.
15
60.
There is a causal connection between Plaintiff Hall's protected activity and the
Defendant' s retaliatory conduct.
61.
Defendant's conduct in this regard was willful and/or done with reckless
disregard of the Plaintiff Hall's rights.
62.
As a result of Plaintiff Hall ' s unlawful termination, he has suffered lost wages,
lost benefits and other perquisites of employment, economk losses related to their
relocation, and attorneys' fees.
COUNT THREE:
DEFAMATION IN EMPLOYMENT AS TO PLAINTIFF
SHANNON HALL AGAINST DEFENDANTS NSCFCU AND HOLT
1-54. Paragraphs 1-54 of this complaint are incorporated herein and made apart hereof
as though fully set forth.
55.
The Defendants defamed Mr. Hall when he accused Mr. Hall of acting erratically
and putting the organization at risk.
56.
The Defendants terminated Plaintiff Hall, because according to a document
placed in Hall's personnel file, "Shannon cannot be trusted as a leader in the
organization. He does not support the CEO's vision and strategy. Shannon' s
erratic behavior puts the organization at risk."
57.
This statement is false because Plaintiff Hall did not engage in any erratic
behavior nor did he put the organization at risk and the Defendants knew that.
58.
On information and belief, the Defendants accused Plaintiff Hall internally of
acting erratically with the intention of justifying Mr. Hall' s termination. As a
result of this defamation, this false statement was placed in Mr. Hall' s personnel
file.
59.
This false statement is defamatory per se.
16
60.
This false statement was made with malice in that it was made recklessly and/or
in conscious disregard for its veracity. Moreover, it was an excuse to terminate
the Plaintiff in retaliation for his protected activity.
61 .
The statements in the "Separation Strategy - VP of Lending" identify the Plaintiff
and were published to Plaintiffs personnel file, and to Defendants' employees.
62.
As a direct and proximate result of Defendants' defamation, Plaintiff Hall
suffered damage to his reputation and lost his job. He also suffered damages in
the form of lost wages and benefits, emotional distress, mental anguish and
attorneys ' fees.
COUNT FOUR:
WRONGFUL DISCHARGE IN VIOLATION OF PUBLIC
POLICY AS TO PLAINTIFF TIMOTHY ROSS AGAINST
DEFENDANT NSFCU
1-54. Paragraphs 1-54 of this complaint are incorporated herein and made a part hereof
as though fully set forth.
55.
Connecticut has a clear public policy in favor of transparency and open and
accurate reporting with regard to financial institutions, as well as a clear public
policy that mandates that employees of financial institutions fully cooperate with
state and federal regulators in order to provide a true picture of the soundness of
that financial institution. See, Conn. Gen. Stat.§ 36a-44-(b)(d), 12 U.C.S.
§1782(a)(6)(C)(i) and 12 C.F.R. § 741.6. In addition, Connecticut has an
established a public policy that prohibits employers from retaliating against
employees who report fraud and suspect violations of the laws regarding open and
accurate financial reporting, such as the policy set forth in Conn. Gen. Stat. §331336 (Connecticut's law providing whistleblowing protections for employees of
17
certain corporations which demonstrates a general public policy in favor of
protecting employees who report fraud internally) as well as public policy
prohibiting fraud and self-dealing in its financial institutions, and in favor of
protecting the members of a state-chartered credit union.
56.
As set out more fully above, by terminating Mr. Ross' employment, Defendant
NSFCU has illegally retaliated against Mr. Ross for his open communication with
state and federal regulators as well as his attempts to uncover and expose
Defendant NSFCU' s unlawful behavior.
57.
Defendant's conduct was willful and/or done with reckless disregard of the
Plaintiff Ross' rights.
58.
As a direct and proximate result of Defendant's retaliatory conduct, Plaintiff Ross
has suffered lost employment, lost wages, lost benefits and other perquisites of
employment, economic losses due to his relocation, damage to his reputations as
well as pain and suffering and attorneys' fees.
COUNT FIVE:
WRONGFUL DISCHARGE IN VIOLATION OF CONN. GEN.
STAT. SEC. 31-Slm AS TO PLAINTIFF TIMOTHY ROSS
AGAINST DEFENDANT NSFCU
1.-54 Paragraphs 1-54 of this complaint are incorporated herein and made a part hereof
as though folly set forth.
55.
During the course of his interactions with the state and federal regulators, Mr.
Ross provided information regarding various bank accounting practices that he
believed violated state and federal reporting requirements, including the
overstating of certain assets and the underfunding of the ALLL to inflate short-
18
term earnings for Defendant NSFCU which he believed was done with the
specific purpose of ensuring that Defendant Holt's bonus targets were met, his
SERP funded, and certain information was concealed from the regulators. Mr.
Ross believed that Defendant Holt's behavior was fraudulent and taken to conceal
from Defendant NSFCU' s membership the full extent of the Defendant's financial
obligations to Defendant Holt. Mr. Ross further believed that this course of
conduct was not in the best interest of the membership or the public.
56.
Mr. Ross' participation in the Annual Safety and Security Review, as well as his
interaction with the state and federal regulators and his complaint about
Defendant NSFCU' s financial reporting practices is protected conduct pursuant to
Conn. Gen. Stat. § 31 -5 lm in that it constituted a report by him to a public body
for a suspected violation of the law governing Connecticut chartered credit
umons.
57.
As set out more fully above, Defendant NSFCU has illegally retaliated against
Plaintiff Ross because he engaged in activity protected by Conn. Gen. Stat. § 3151 m.
58.
Defendant NSFCU had knowledge of Plaintiff Ross' protected conduct.
59.
In retaliation for Mr. Ross' open participation in this process, Defendant NSFCU
terminated his employment, in violation of Conn. Gen. § 31-5 lm.
60.
There is a causal connection between Plaintiff Ross' protected activity and the
Defendant's retaliatory conduct.
61.
Defendant' s conduct in this regard was willful and/or done with reckless
disregard of the Plaintiff's rights.
19
62.
As a result of Mr. Ross' unlawful termination, he has suffered lost wages, lost
benefits and other perquisites of employment, economic losses related to his
relocation, and attorneys' fees.
20
IV.
PRAYER FOR RELIEF
Wherefore, the Plaintiffs claims as to each count the following damages:
COUNT ONE:
1.
WRONGFUL DISCHARGE IN VIOLATION OF PUBLIC POLICY
AS TO PLAINTIFF SHANNON HALL AGAINST DEFENDANT
NSFCU
Compensatory damages, including back pay with interest and lost benefits, the
cost of re-location, and emotional distress damages;
2.
Punitive damages under the common law;
3.
Attorneys ' fees and cost; and
4.
Any and all other relief as the court deems just and proper.
COUNT TWO:
WRONGFUL DISCHARGE IN VIOLATION OF CONN. GEN.
STAT. § 31-Slm AS TO PLAINTIFF SHANNON HALL AGAINST
DEFENDANT NSFCU
1.
Reinstatement, pursuant to Conn. Gen. Stat. §31-5 lm or front pay;
2.
Back pay, with interest and lost benefits pursuant to Conn. Gen. Stat. §31-5 lm;
3.
Punitive damages under the common law;
4.
Attorneys' fees and cost, pursuant to Conn. Gen. Stat. §31-5 lm; and
5.
Any and all other relief as the court deems just and proper.
COUNT THREE:
1.
DEFAMATION IN EMPLOYMENT AS TO PLAINTIFF
SHANNON HALL AGAINST DEFENDANTS NSCFU AND HOLT
Compensatory damages, including back pay, lost benefits, emotional distress,
mental anguish, and damage to his reputation;
2.
Punitive damages under the common law;
3.
Costs; and
4.
Any and all other relief as the court deems just and proper.
21
COUNT FOUR:
1.
WRONGFUL DISCHARGE IN VIOLATION OF PUBLIC POLICY
AS TO PLAINTIFF TIMOTHY ROSS AGAINST DEFENDANT
NSFCU
Compensatory damages, including back pay with interest and lost benefits, the
cost of re-location, and emotional distress damages;
2.
Punitive damages under the common law;
3.
Attorneys' fees and cost; and
4.
Any and all other relief as the court deems just and proper.
COUNT FIVE:
WRONGFUL DISCHARGE IN VIOLATION OF CONN.
GEN.STAT. § 31-Slm AS TO PLAINTIFF TIMOTHY ROSS
AGAINST DEFENDANT NSFCU
1.
Reinstatement, pursuant to Conn. Gen. Stat. §31-5 lm or front pay;
2.
Back pay, with interest and lost benefits pursuant to Conn. Gen. Stat. §31 -5lm;
3.
Punitive damages under the common law;
4.
Attorneys' fees and cost, pursuant to Conn. Gen. Stat. §31-5lm; and
5.
Any and all other relief as the court deems just and proper.
By:~
22
/ ~
--....____
DeborahLc. McKenna
Richard E. Hayber
(Juris No. 426871)
The Hayber Law Firm, LLC
221 Main Street, Suite 502
Hartford, CT 06106
Telephone: (860) 522-8888
Facsimile: (860) 218-9555
dmckenna@hayberlawfirrn.com
rhayber@hayberlawfirm.com
Attorneys for the Plaintiffs
STATE OF CONNECTICUT
SUPERIOR COURT
RETURN DATE:
MAY 31, 2016
JUDICIAL DISTRICT OF HARTFORD
AT HARTFORD
Shannon Hall and Timothy Ross
The Plaintiffs,
v.
Nutmeg State Financial Credit Union
The Defendant.
March 31, 2016
STATEMENT OF AMOUNT IN DEMAND
WHEREFORE, the Plaintiffs claims a cause of action seeking damages not less than
$15,000, exclusive of interest and costs, which cause is within the jurisdiction of the Superior
Court.
By:4
Deborah L. McKenna
Richard E. Hayber
(Juris No. 426871)
The Hayber Law Firm, LLC
221 Main Street, Suite 502
Hartford, CT 06106
Telephone: (860) 522-8888
Facsimile: (860) 218-9555
dmckenna@hayberlawfirm.com
rhayber@hayberlawfirm.com
Attorneys for the Plaintiffs
23