Barnes & Noble sued by former CEO for defamation, breach of contract

The former CEO of Barnes & Noble sued the struggling book retailer for defamation and breach of contract on Tuesday, alleging the company used false accusations of misconduct to oust him from the role last July.

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Filed in federal court in New York City, Demos Parneros’ complaint alleges officials worked to force him out of the company after a deal to sell Barnes & Noble to an unnamed company fell through earlier this summer. Parneros, who denies allegations of misconduct, said company executives caused him “significant injury” and used language they “knew full well was false but would be read as reporting that Parneros had engaged in serious sexual misconduct.”

Parneros claimed he was falsely accused of bullying CFO Allen Lindstrom, though he acknowledged they had business-related disagreements. The former chief executive also denied any wrongdoing related to his interactions with an executive assistant, which company officials are said to have cited when informing Parneros of the reasons for his dismissal.

“The lawsuit is nothing but an attempt to extort money from the company by a CEO who was terminated for sexual harassment, bullying behavior and other violations of company policies,” Barnes & Noble’s board of directors said in a statement, noting that the company had conducted a thorough investigation into Parneros’ conduct.

Barnes & Noble fired Parneros without severance pay for unspecified violations of company policy. At the time, the company would only say that his dismissal was not related to financial fraud of any kind. Parneros was also removed from the company’s board of directors. 

Once a leading retailer, Barnes & Noble has struggled through several years of weaker sales amid declining store traffic and the rise of e-commerce competitors. The company is in the midst of a turnaround effort.

Parneros is seeking more than $4 million in severance as well as damages, Reuters reported.