Wedbush Securities Inc. is asking a judge to put on hold a lawsuit filed by a former senior vice president who alleges that he was wrongfully terminated in 2024, but the plaintiff says in new court papers the delay would be unfair to him.
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attorneys that even if the parties agreed to the terms of a 2011 agreement compelling arbitration, the accord was superseded by a January 2023 employment agreement that did not contain such a requirement.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 contend that because the company is appealing her arbitration ruling, putting discovery on hold pending an appellate court’s decision is warranted. But in a sworn declaration submitted Friday in opposition to the stay, Stuart says 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 says, adding that 18 months have passed since his termination. One likely witness has terminal brain cancer, Stuart further says.
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.
“I seek expeditious resolution of my claims via trial and believe that having to delay discovery and my trial date is prejudicial to me,” Stuart states.
But in their court papers filed in advance of an Aug. 20 hearing, Wedbush lawyers maintain 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.
In March 2015, a former Wedbush employee filed a class-action and Private Attorneys General Act lawsuit against Wedbush alleging that the company, among other things, engaged in wage theft and that it failed to pay employees for overtime hours and for missed meal and rest periods.
The California Labor Code Private Attorneys General Act allows aggrieved employees to sue employers for Labor Code violations and recover civil penalties on behalf of the state.
In November 2020, a state appellate court held in the other matter that Wedbush’s commissioned employees, which included Stuart, were not subject to the administrative exemption under California law and were entitled to overtime pay and meal and rest periods. Stuart contends he did not receive overtime or meal and rest periods.
In April 2024, management asked Stuart and some of his colleagues to release their PAGA claims, telling Stuart it “would be helpful to the Wedbush family” to do so, but all of them eventually refused to do so, Stuart alleges. Then, in August of the same year, Wedbush gave Stuart and a colleague low bonuses despite strong job performances, according to Stuart’s suit.
Stuart and his co-workers who objected to the PAGA releases were all over 50 years old and had worked for Wedbush for more than 20 years when they were fired effective December 2024, the Stuart suit states. Stuart believes that Wedbush CEO Gary Wedbush wanted to get rid of the plaintiff and his colleagues because he considered them “disloyal,” according to the plaintiff’s suit filed last Nov. 21.