The case of a Tyco Electronics whistleblower who claims he was fired for refusing to sign off on an extravagant party reminiscent of one thrown by now-jailed Tyco CEO Dennis Kozlowski returns to court tomorrow in front of a federal judge in Philadelphia.
Jeffrey Wiest, a former accounts payable manager with Tyco Electronics outside Harrisburg, Pa., sued the company, saying he was fired in 2009 after 31 years with the electronics giant because he questioned $350,000 in expenses tied to a 2008 trip to the Bahamas for 81 Tyco Electronics employees.
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Tyco Electronics was spun off from Tyco International (NYSE: TYC) in 2007 and now goes by the name TE Connectivity (NYSE: TEL).
Wiest's case is being closely watched by attorneys from both sides of the whistleblower aisle: those representing whistleblowers and those representing companies accused of retaliation.
“In a way it’s a major case and it’s still in its early stages.”
The Tyco Electronics excursion, which the company has argued was an incentive bonus for top sales people and a justifiable business write-off, included costumed mermaid greeters, pirate wenches and tattoo artists.
“The first thing that went through my mind when I saw the invoice was the party in Sardinia,” said Wiest in an interview Monday with FOXBusiness.com.
Wiest was referring to an infamous party thrown by Kozlowski on the Mediterranean island of Sardinia that was a birthday party for Kozlowski’s wife and financed in part by Tyco, then the parent of Tyco Electronics. The $2 million bash was themed as a Roman toga party and famously included an ice statue of Michelangelo’s David that spouted expensive vodka.
Wiest said the Bahamas trip included just 1½ hours of business over the course of a 5-day trip.
Tyco Electronics has fought back against Wiest, claiming he was never fired, that Wiest left his job for medical reasons. Moreover, Tyco Electronics has said Wiest was the subject of a handful of sexual harassment complaints from female employees who worked with him.
On Tuesday, Tyco Electronics' lawyers will appear in court with Wiest’s lawyer, Richard Angino, for a status hearing to map out the direction of the case.
Tyco Can Appeal to the U.S. Supreme Court
In March, a federal appeals court overruled an earlier lower court’s ruling that dismissed Wiest’s case. Wiest had argued that his refusal to sign off on the $350,000 trip was protected under Sarbanes-Oxley legislation passed by Congress over a decade ago in an effort to protect whistleblowers from retaliation.
U.S. District Judge Gene Pratter found in July 2011 that Wiest had failed to prove his actions were protected by Sarbanes-Oxley. Wiest appealed that decision and the appeals court ruled in his favor, saying the laws used to determine the lower court’s ruling had subsequently been pre-empted by new legislation that protected Wiest.
Tyco Electronics can either appeal the latest ruling to the U.S. Supreme Court, return to federal district court for trial against Wiest, or reach a settlement with him.
“I just want some kind of equity out of this,” said Wiest. “If they offer a settlement I’ll listen to my lawyer’s advice.”
Angino, Wiest’s lawyer, said in an interview, “In a way it’s a major case and it’s still in its early stages.”
The lawyer said Tyco Electronics has 90 days from the day of the appeals court ruling to decide whether to ask the Supreme Court to intervene. Otherwise the case returns to federal district court.
Angino offered a bit of speculation on whistleblower cases in general: “These cases are going to go to the Supreme Court without question because this is such a political issue.”
In other words, he explained, many of the judges who rule on whistleblower cases make their rulings based on political biases.
“Here is the same company whose CEO is sitting in jail for having the same kind of parties that Tyco (Electronics) asked Mr. Wiest to approve,” Angino observed. “My guy said, ‘Are you guys for real?’”
Kozlowski was convicted in 2005 of pilfering millions of dollars from Tyco to subsidize an extravagant lifestyle that included a $30 million apartment as well as garish parties. He was sentenced to 8 1/3 to 25 years in prison and is currently seeking parole.
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