Cincinnati Stockbroker Wins Libel Ruling Against Former Employer: Claimed He Was Defamed In False Regulatory Filing

CINCINNATI (TDB) -- A brokerage company that claims it is among the best places to work in Ohio just got socked for mistreating a former worker. Carlos Reisen Jr. said his ex-bosses furnished false information to the Financial Industry Regulatory Authority (FINRA) on a termination notice. A federal judge agrees the form was filed with reckless disregard for the truth and has upheld a $516,000 damage award. U.S. District Judge Susan Dlott sided with an arbitration panel that said the "language . . . associated with Mr. Reisen's termination was defamatory." Reisen had been the Cincinnati branch manager for Hilliard Lyons, a Louisville brokerage that touts itself as "the best place to work in four states." The company has 70 offices in 13 states.

Hilliard Lyons' reckless conduct dates to April 23, 2008 when it reported to FINRA that Reisen had been sacked for disloyalty: "Mr. Risen (sic) was involuntarily terminated for violating his duty of loyalty to the company. As a manager, Mr. Reisen knowingly facilitated the departure of two financial consultants who were hired by a competitor while himself interviewing with the competitor. His termination was not the result of any sales practice related reasons." The statement -- which turned out to be untrue -- was filed on a Form U5/Termination Notice for Securities Industry Registration.

Reisen initially sought $1.8 million in compensatory damages and $$3.7 million in punitive damages. Hilliard Lyons contended that it had not been reckless in filing the termination notice, and said there was no defamation. It also contended the statement was privileged because it was made in the context of a judicial or quasi-judicial proceeding. Judge Dlott saw otherwise:

"Defamatory statements made with reckless disregard for the truth are not entitled to a qualified privilege under Ohio law . . . The [arbitration] Panel held that the 'language associated with Mr. Reisen's termination was defamatory' and that the 'preparation of the U% was negligent and reckless.' Even assuming that the Panel accorded qualified privilege to the Form U5 statements, that privilege was defeated as a matter of law by the factual finding that Hilliard Lyons preparation of the For U5 was reckless."

The filing was changed to say he was involuntarily terminated due to a management conflict. The disloyalty claim was expunged. The case is 1:09-cv-00535 in U.S. District Court for the Southern District of Ohio. Attorney William K. Flynn of Strauss & Troy represented Reisen.

Ex-Cincinnati Enquirer Reporter Jim McNair: His Lawyers Transform Firing To Buyout

CINCINNATI (TDB) -- Last August, veteran Cincinnati Enquirer reporter Jim McNair was sacked amid a furor of buzz that he was too aggressive and unable to adapt to a faint-hearted newsroom culture. Now there is word that McNair's termination has been changed to a buyout by the Gannett Co. Inc., metro daily. The newspaper -- which escorted him off the premises and terminated him on the spot -- appears to have backed away from the firing after the 54-year-old journalist found some heavy-hitting employment law attorneys to take his case. McNair told The Daily Bellwether today that his personnel records no longer reflect a termination, and that he was indeed represented by Cincinnati employment law specialists Randy Freking and Tod Thompson.

"This is what I can say: My termination of last August has been converted to the voluntary acceptance of a buyout. That's all I'm legally able to say about the subject."

While the terms of the buyout have not been made public, they are no doubt similar to what newspaper chain Gannett has been offering at USA Today and the Detroit Free Press -- two weeks pay for every year on the job. McNair was at the Cincinnati Enquirer for six years, which means he probably collected about 12 weeks of paychecks by challenging his bosses. He came to the newspaper from the Miami Herald, and still lives in Cincinnati. McNair has been doing freelance consulting and independent research for investment companies and law firms. He's also been a suspect as the blogger behind NewsAche, which appears from time to time and disses the Enquirer as the worst metro daily newspaper in the nation. McNair insists he's not NewsAche.

That parlor game -- guessing who authors the blog -- may grow more interesting. If NewsAche disappears, it was probably McNair, whose buyout agreement likely contains the standard legal boilerplate that forbids "disparagement" of a former employer. If NewsAche continues, then it must be someone else. McNair would not be prone to risk his three months pay -- and give Gannett a chance to put him on the legal ropes -- over anonymous blogging.