October 31, 2020

Big 4 Lawsuits: Ex-PwC Partner vs. PwC, Deloitte Partner vs. Deloitte Australia, Watchstone vs. PwC U.K.

On the docket: wrongful termination, age discrimination, and conspiracy!

Former PwC partner sues company, claims hes owed $15 million [Minneapolis/St. Paul Business Journal]
This lawsuit filed by a former Minneapolis-based PwC partner who claims he was wrongly terminated and is owed millions of dollars should keep the firm’s lawyers busy for a while.

John Cahill was hired by the accounting firm as a partner in May 2016, according to the complaint he filed in Hennepin County District Court. Part of his job responsibilities were to drum up new business and clients for the company. Cahill claims he was successful, but PwC took the new accounts away from him, causing him to miss performance requirements and lead to his termination.

Cahill’s suit says he lost out on more than $15 million in potential income.

“PwC made Cahill promises they failed to keep, refused to honor his requests for information, failed to disclose material facts to him, purposefully kept him in the dark about the coup they were orchestrating behind the scenes, and lied to his face about their unlawful tactics,” according to the complaint. “Cahill seeks to recover the amount to which he would have been entitled but for PwC’s wrongful actions—the compensation he would have received until mandatory retirement at age 60, which is more than $15,000,000.”

PwC said in a statement that Cahill’s allegations have no merit, that he was fired because he failed to meet performance expectations, and that he agreed to arbitrate his claims, therefore the court filing violates that agreement.

Older partner claims Deloitte forced him out [Australian Financial Review]
In Australia we have a case of a Deloitte partner who doesn’t want to retire yet but says Deloitte is making him leave the partnership because he recently turned 62 years old. So the partner is suing the firm and CEO Richard Deutsch for age discrimination.

Auditor Colin Brown is seeking damages of more than $3 million over claims Deloitte Australia illegally tried to force him out of the lucrative partnership.

Mr Brown, 64, also claimed Mr Deutsch, 53, victimised him for challenging the age-based policy, which would have seen him move to a “consultancy agreement” that cut his annual income from $750,000 to $400,000.

He wants the Federal Court to force Deloitte Australia and Mr Deutsch to acknowledge they have committed age discrimination and to say they will no longer have a “mandatory retirement age” for partners.

This is the first time that a partner has challenged one of the big four consulting partnerships over its age-based retirement policies in court.

Now I know what you’re thinking: “He signed the partnership agreement, so he had to know there was a mandatory retirement age. He’s got no case; he’s going to lose.” I thought the same thing.

In his lawsuit, Brown, who joined the partnership in June 2014 at the age of 58, alleges that Deloitte Australia has a policy that requires partners “to retire in or around May following their 62nd birthday,” a requirement that he said breached the Age Discrimination Act, according to AFR. But he claims that mandatory retirement policy wasn’t included in the partnership agreement he signed:

His appointment was preceded by several months of interviews with Deloitte Australia’s leadership, including meetings where Mr Brown was told he would be staffed across multiple audit clients – a commitment that usually lasts 10 years.

He was also provided with a copy of the firm’s partnership agreement which, according to his statement of claim, “deals with expulsion from the partnership, and other forms of termination or retirement from the partnership, but does not make any provision for retirement on account of age”.

It’ll be interesting to see how this all plays out in court.

PwC sued for £63m over Quindell deal ‘conspiracy’ [Financial Times]
A lawsuit accuses the Queen’s PwC of conspiring against a former client by releasing private financial information about the client to a rival during a takeover attempt.

The lawsuit is being brought by Watchstone, an insurance and technology group formerly known as Quindell, which had hired PwC to give it restructuring advice during the run-up to its ill-fated takeover by Slater & Gordon, a law firm, in 2015.

In a claim filed at London’s High Court on Thursday [Aug. 6], Watchstone claimed PwC breached its contract and confidence, breached its fiduciary duty and committed “unlawful means conspiracy” against it.

So apparently, executives from PwC and Greenhill & Co., an advisor working for Slater and Gordon, had a secret meeting, or a “quiet coffee,” where the PwCer allegedly handed over confidential details about Watchstone’s finances, including that it would run out of cash in mid-2015. PwC would know—the firm had been paid £5 million to conduct a review into Watchstone’s finances.

Watchstone’s suit says Slater and Gordon was able to pay a lower price for the company due to the confidential knowledge it had about the business, wiping £63 million off the value of the deal.

Latest Accounting Jobs--Apply Now:

Have something to add to this story? Give us a shout by email, Twitter, or text/call the tipline at 202-505-8885. As always, all tips are anonymous.

Related articles