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The SEC is settling a wrongful termination suit filed by an employee who was fired after he went public with allegations of favoritism and improper behavior at the Commission. The Government Accountability Project, who represented fired staffer Gary Aguirre, said the settlement would include a payment for back pay and attorney's fees amounting to a total of $755,000. This may be the largest settlement of this kind.
According to the Associated Press, Aguirre's troubles with his former employers began when he was fired in 2005. In 2006, he took allegations public that SEC officials improperly interfered with an investigation of Pequot Capital Management. The allegations touched off an investigation by Republican staff of the Senate Judiciary and Finance Committees.
The SEC had closed the Pequot case by 2006. The AP reports the Commission re-opened it in January 2009, after documents from a divorce proceeding showed Pequot began paying $2.1 million to a key witness in the case in mid-2007. Last month, Pequot and its founder and chairman, Arthur Samberg, agreed to pay $28 million to settle the SEC's charges of insider trading of Microsoft shares.
What does this mean for Gary Aguirre? He has received his back pay and been compensated for his expenditure of attorneys fees. In cases of wrongful termination, an employee is fired for an illegal reason such as termination in violation of state or federal discrimination laws, labor or collective bargaining laws, as a form of sexual harassment, or as in Aguirre's case, as retaliation for the employee's having filed a complaint or claim against the employer. Remedies for a successful claim of wrongful termination often include back pay, a severance package, or even punitive damages.
Aguirre, in a statement said, "I think it's fair to the public that the SEC pays for my work over the past four years and 10 months, since it generated $28 million to the U.S. Treasury."
The AP reports SEC spokesman John Nester said the settlement "resolves all outstanding litigation between the parties and reflects the agency's determination to focus on its core mission of protecting investors."
Under terms of the settlement, Aguirre agreed to drop two related cases against the SEC.