Wells Fargo's Defense in Federal Court Against $34M Lawsuit by Former CEO
Wells Fargo's Defense in Fed...
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Wells Fargo's Defense in Federal Court Against $34M Lawsuit by Former CEO

17 April 2024
2 min.
Wells Fargo's Defense in Federal Court Against $34M Lawsuit by Former CEO

Wells Fargo's Battle

Wells Fargo is pushing for the dismissal of a lawsuit brought by its former CEO, Timothy Sloan, who claims the bank owes him $34 million in compensation. Sloan filed the lawsuit in December, alleging that the bank reneged on promises of bonuses and stock awards made to him before his retirement in 2019.

The San Francisco-based bank, with its largest employment hub in Charlotte, recently filed a motion to dismiss Sloan's complaint with the Superior Court of California in San Francisco County. In response, Wells Fargo's attorneys cited 14 defenses against Sloan's claims, including references to California labor codes and denials of wrongdoing. They assert that any alleged failure to comply with labor codes was done in good faith and with reasonable grounds, with the assumption that Sloan understood them.

According to a statement from Wells Fargo's legal team, the bank contends that it "timely paid all amounts due to the plaintiff and did not owe any additional amounts."

Sloan's attorney, David Lowe, expressed confidence that evidence will demonstrate Sloan's professionalism and dedication to Wells Fargo's interests during his tenure as CEO. Sloan maintains that he was unfairly scapegoated for sales practices that led to regulatory penalties and a congressional hearing involving unauthorized accounts being opened.

The lawsuit comes in the aftermath of Wells Fargo's $1 billion settlement of a class-action lawsuit with shareholders last May, in which the bank was accused of misleading investors about its compliance with regulators amid the sales scandal. Sloan argues that the issues predated his CEO tenure and that he made efforts to address them before his retirement.

Sloan, who served at Wells Fargo for over three decades, is also seeking damages for unspecified distress, among other claims. A trial date has yet to be set.

Wells Fargo reiterated its stance on compensation decisions, emphasizing that they are based on performance. A spokeswoman for the bank affirmed, "We stand behind our decisions in this matter."

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