A judge has granted a motion by Wedbush Securities Inc. to put on hold a lawsuit filed by a former senior vice president who alleges that he was wrongfully terminated in 2024.
Michael Stuart alleges he was subjected to a backlash because he resisted pressure to release legal claims for wage theft penalties that were the subject of a separate lawsuit filed by a different former Wedbush employee. On May 29, Los Angeles Superior Court Judge Kristin S. Escalante agreed with Stuart’s attorneys that even if the parties agreed to the terms of a 2011 agreement compelling arbitration, the accord was superseded by a January 2023 employment agreement that did not contain such a requirement.
Wedbush attorneys contended that because the company is appealing her arbitration ruling, putting discovery on hold pending an appellate court’s decision was warranted. On Thursday, the judge granted the stay motion with the hold to be lifted temporarily to allow the `trial-preservation deposition” of a plaintiff’s witness in poor health on a date still to be determined.
In a sworn declaration submitted in opposition to the stay, Stuart said several current and former Wedbush employees have information about the “highly suspicious circumstances surrounding the termination of my employment…”
Many of the witnesses, at least four of whom are no longer at Wedbush, may not be available or may have significantly faded memories about the circumstances of Stuart’s termination in a year or two, he said, adding that 18 months have passed since his termination.
Stuart also says he is concerned that Wedbush, its employees, and/or other witnesses may also inadvertently delete or fail to preserve documents that are relevant to his claims during the next year or two.
But in their court papers, Wedbush lawyers maintained that a stay is “consistent with the general principle that a trial court should not exercise jurisdiction over aspects of a case involved in an appeal. Moreover, a stay is warranted to avoid prejudice and because the decision to deny arbitration was highly contested and a close call.”
According to his lawsuit, Stuart was hired in September 2002, as an associate in institutional equity sales and five years later was promoted to his final position of senior vice president of equity sales.
A status conference is scheduled Feb. 19, 2027.