RealTime IT News

Former Exec Sues Edgar Online

A former senior vice president of business and strategy development at popular online financial site Edgar Online , filed suit against his former employers this week.

A. Jason Sears is accusing the Norwalk, Conn., firm of violating Connecticut's Whistleblower Act, along with three other charges.

The former executive of the company is also seeking damages that could add up to more than half a million dollars for breach of contract and slander issues brought to light during his termination March 1.

The whistleblower charges stem from what Sear's lawyer says is the improper termination of his client, who questioned the statements about to be made in an S-2 filing to the Securities & Exchange Commission (SEC) to raise money for the company.

According court papers obtained by internetnews.com, Edgar Online's "overriding interest was to raise desperately needed capital through a successful securities offering, and an employee who questioned the accuracy of the selling document simply could not be tolerated," it states.

A spokesperson for Edgar Online said the company does not comment on pending litigation.

Directly indicted in the complaint is Susan Strausberg, Edgar Online president and CEO, who allegedly fired Sears after a series of actions to avoid paying him his contracted severance pay, which includes an annual salary of $140,000, up to 50 percent of his salary in bonuses, and accrued pay for the year. It's a sum that comes to approximately $360,000, not including any stock options that became vested at the time of termination.

According to the suit, late last year Strausberg informed Sears his contract would not be extended after it expired April 30. She later tried to entice Sears to stay on as an "at will" employee, which would have negated his severance pay according to his contract with the company. During the first part of 2004, the document went on, executives at Edgar Online were requested to review a Form S-2 about to be filed with the SEC, which would have given the company more common stock for purchase on the market.

Not mentioned in the S-2, according to the suit, was Sears' upcoming termination and severance payment on April 30, a disclosure item required on the federal form for senior executives. Sears alleges he informed company officials of the omission, who subsequently rejected his observations.

At this point, Sears brought in the Stamford, Conn., law firm of Martin, Lucas & Chioffi, to send a letter Feb. 27 to Strausberg and the other executives at Edgar Online, requesting they honor his contract with them, specifically the severance package. Up to this point, the suit states, the company had not paid the contracted severance package. Obviously angered by the legal communication, Strausberg called him into a meeting with the finance and human resources directors and fired him, having him removed from the building without giving him the option to collect his personal items.

When the company filed its S-2 with the SEC March 30, according to the suit, it removed Sears' name from the filing entirely. The suit also charges Strausberg with damaging his reputation and professionalism at the company by making disparaging remarks about his abilities, as well as stripping away most of his job duties long before he was due to leave the company.