Payne & Fears LLP Wins Major Arbitration Award for Investment Advisory Firm Against Former Employee
Payne & Fears partners Dan Livingston and Jeff Brown scored a remarkable win for an SEC-registered real estate investment advisory firm that had been sued by a former employee. The terminated employee initiated a lawsuit against his former employer and its president alleging various breaches of contract and tort claims, and demanding almost $9 million in asserted damages.
Livingston and Brown successfully compelled the case to arbitration and, following the one-week arbitration hearing, retired Federal Magistrate Judge Rosalyn Chapman found in favor of our client and its president on all counts. In her ruling dismissing all of the employee’s claims, Judge Chapman found that they were “without merit” and that the employee had brought his claims against our clients “in bad faith”. The final arbitration award, which was confirmed and entered as a Judgment in the Orange County Superior Court on May 16, 2023, included an award against the employee for more than $1.5 million in attorney’s fees and costs to our client as the prevailing party. It is very unusual for a court or arbitrator to make such a finding and award fees and costs against an employee.
Our client’s president noted that: “The ruling in this case represents a complete vindication of our position with its finding that the allegations were without merit and brought in bad faith. Although we were disappointed that we had defend ourselves at trial, Dan Livingston and Jeff Brown did a truly superlative job in exposing the complete lack of foundation to this case, and Judge Chapman’s ruling is a testament to their outstanding advocacy skills.”