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NASD Awards $1.2M to A.G. Edwards Ex-Worker in Mental Disability Case

An arbitration panel of the National Association of Securities Dealers recently awarded more than $1.2 million to a former branch manager for A.G. Edwards & Sons Inc. who claimed the brokerage illegally demoted him after he took a medical leave for bipolar disorder.

"Victories are very rare in cases such as this one where the initial allegations included both actual disability and perceived disability," attorney Joshua Van Kampen of Fosbinder & Van Kampen said during a telephone interview. Van Kampen represented claimant Donald Allen in his Americans with Disabilities Act action.

"We also believe the substantial recovery amount is also unusual for an ADA case," the attorney added.

Allen filed a statement of claim in arbitration, the equivalent of a court complaint, against A.G. Edwards.

He said he was a branch manager for the company in Charlotte, N.C. When he joined A.G. Edwards in 1989, Allen said, he signed an investment broker agreement that required him to arbitrate all employment disputes before the New York Stock Exchange or the NASD.

During 2001, his last year with A.G. Edwards, Allen experienced increasingly severe symptoms of bipolar disorder. Because of those symptoms, Allen took a brief leave of absence from work in May 2001 to recover, the statement said.

When he came back to work, Allen presented the company with physician's releases allowing him to return with no restrictions, he said. However, the company demoted him to the job of financial consultant, a move that resulted in a dramatic loss of income, Allen said.

Over the next five months Allen attempted to talk with his regional manager to develop a plan whereby he could once again work as branch manager, according to the statement.

However, the regional manager allegedly refused to discuss any reasonable accommodation with Allen and delayed making a decision about returning Allen to his old job.

Allen said he decided to hire an attorney, who in turn contacted A.G. Edwards' headquarters about the alleged discrimination, which included the creation of a hostile workplace.

The company instructed its employees at the Charlotte branch not to talk with Allen about his situation, according to the statement. As a result of this directive, his co-workers shunned him, Allen claimed.

After the regional manager told Allen he was permanently demoted, he left the company, saying he had been constructively discharged.

Allen said he initially filed his claims in North Carolina state court rather than seeking arbitration because he believed the arbitration agreement was unenforceable.

He said the agreement was unenforceable because the Americans with Disabilities Act went into law after the arbitration agreement was signed, because there was a lack of mutual obligation with respect to arbitration of claims and because it imposed burdensome costs on him, among other things.

A.G. Edwards removed the case to the U.S. District Court for the Western District of North Carolina, which granted the company's motion to compel arbitration with the National Association of Securities Dealers in July 2004.

"We were initially quite reluctant about relying on an arbitration panel to decide our case," Allen's attorney said. "However, after doing some research, we discovered that an arbitration panel is more likely to find a plaintiff disabled than is a jury."

The statement of claim in arbitration alleged that A.G. Edwards had violated North Carolina's Equal Employment Practices Act, the Americans with Disabilities Act, and the Family and Medical Leave Act.

The statement also contained state law claims of wrongful demotion and constructive discharge in violation of North Carolina public policy, negligent infliction of emotional distress, breach of contract, and tortious interference with business relations.

Allen asked the NASD arbitration panel to award him $10 million in damages.

According to a case summary included with the arbitration award, A.G. Edwards denied it violated the ADA because Allen did not have a "disability" within the meaning of the statute.

The company also said Allen was not a "qualified individual with a disability" under the ADA and was not "otherwise qualified" under the law.

A.G. Edwards also insisted it could not reasonably accommodate Allen because, among other things, any additional accommodations would have created an undue hardship on the company.

As for Allen's FMLA claims, A.G. Edwards countered that Allen did not have a serious health condition and failed to give the required notice for leave.

Although the eight-page arbitration award included a summary of the case, it did not describe the three-judge panel's reasoning. Arbitration awards typically do not contain such details, according to Van Kampen.