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Charles V. Marais v. Barclays De Zoete Wedd, Inc. and Barclays Capital - 9/26/2002

Award Amount- $4,200,000.00

Case Summary: Our client, Charles V. Marais, a former equity derivatives salesman with Barclays De Zoete Wedd, Inc. and Barclays Capital ("Barclays"), sued Barclays for wrongful termination, breach of contract, quantum meruit, fraud, negligent misrepresentation, promissory estoppel, violations of the New York Labor Law, and tortious interference with prospective economic advantage. On September 26, 2002, a NASD arbitration panel, chaired by retired New York State Supreme Court Justice Walter M. Schackman, awarded Mr. Marais $1,250,000 in damages based on the filing of a damaging U-5 NASD regulatory form, over $642,000 in various contract damages, $106,242 in liquidated damages based on wages withheld pursuant to New York's Labor Law, $248,000 in legal fees under the Labor Law, and $1,000,000 in punitive damages. The award, which specified that nine percent interest be paid on various components from as early as February 6, 1996, when Mr. Marais' 1995 bonus should have been paid, totaled nearly $4.2 million, inclusive of punitive damages and pre-award interest. Mr. Marais asserted that Barclays had scapegoated him and subjected him to employment restrictions before firing him. Mr. Marais alleged that Barclays took these actions in order to deflect attention from a variety of regulatory issues plaguing the bank and due to Barclays' concern about its effort to expand its securities trading ("Section 20") powers, despite acknowledging to regulators that Mr. Marais was not in violation of Barclays' procedures and promising to him that he would be paid bonus compensation he had earned. The award chastised Barclays, finding that it had "willfully and wantonly disregarded the rights of Claimant" regarding the Form U-5 filing, and "in subjecting Claimant to humiliation in their various interrogations of him during 1996; in failing to advise Claimant to retain his own counsel at the appropriate time; and misleading Claimant as to the likelihood of his continued employment with Respondents." The award of punitive damages apparently also represented sanctions for Barclays' misconduct during the arbitration itself. The award specified that the $1 million punitive damages award also related to Barclays "consciously disregarding a specific order of the Panel to produce a document after being warned that a sanction would follow," as well as "withholding records from Claimant's counsel." On March 31, 2003, the New York State Supreme Court confirmed the arbitration award and rejected Barclays' motion to vacate the award. Click here to read the Court's detailed opinion.

Jeffrey L. Liddle

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