After a lengthy delay, the litigation between Barnes & Noble and its former CEO is heating up again.
In an order this week, judge Mary Kay Vyskocil has set August 6 at 11 a.m. for oral argument on a B&N motion for partial Summary Judgment that seeks to knock out two of the most dangerous—and potentially costly—claims in a bombshell lawsuit filed against the retailer by fired CEO Demos Parneros in August of 2018—claims for defamation, and for breach of good faith and fair dealing.
The oral argument is a potentially major development in the litigation, which stems from B&N's sudden dismissal of its former CEO on July 3, 2018. At a November 4, 2019, pre-motion conference, then presiding judge John G. Koeltl repeatedly warned the B&N lawyers that a bid for Summary Judgment was a “risky” move, and urged the parties to consider settlement discussions. But despite the words of caution, on November 22, B&N moved for Summary Judgment, and in a 33-page supporting memorandum, argued that Parneros was fired for cause, and that his claims for defamation and for breach of the covenant of good faith fail because there is no evidence to support them.
In an opposition brief filed in January, however, attorneys for Parneros argue that the former CEO’s surprise 2018 dismissal was engineered on false pretenses by an angry Len Riggio, and that a vaguely-worded B&N press release announcing the firing implied sexual misconduct, “lumping Parneros with the Harvey Weinsteins of the world,” and making the longtime executive virtually unemployable. In addition, Parneros says the company denied him his severance, and acted with malice by firing him just days before his equity award was set to vest.
Previous filings suggest that Parneros is seeking approximately $70 million in damages for the defamation claim alone, as well as approximately $6.4 million for a third claim, for breach of contract. Barnes & Noble is also countersuing Parneros, seeking to claw back some of the CEO’s compensation.