JPMorgan Replies on Retaliation Claim

We have an update on that lawsuit filed last year by a former compliance officer at JP Morgan, who says she was fired for raising concerns about weaknesses in the bank’s compliance program. JPMorgan has now filed a motion to dismiss, and depicts the former compliance officer as a terrible employee who was fired for poor performance. 

The lawsuit was filed last fall by Shaquala Williams, who worked for JPMorgan for 16 months in 2018 and 2019 as a vice president on the bank’s global anti-corruption compliance team. Her primary duties were to prepare monthly reports for senior management on certain corruption risk indicators, and to review and oversee the bank’s third-party intermediary compliance program.

pre-taliationAccording to Williams, she flagged several problems in JPMorgan’s compliance program almost immediately: poor policies and procedures to govern third-party intermediaries, a lack of invoice controls, and deficient due diligence processes, among other issues. When Williams tried to raise her concerns to higher-ups in JPMorgan’s compliance function, she said, those supervisors and others at the bank first tried to downplay her concerns. When she pushed ahead with internal complaints anyway, supervisors then allegedly retaliated by giving her poor performance reviews. She was fired in November 2019.

That was Williams’ version of events, at least. She filed a retaliation lawsuit in federal court last November. On April 29 JPMorgan replied with a motion to dismiss. Since Radical Compliance devoted a whole post to Williams’ initial complaint, it’s only fair that we give time to JPMorgan’s response, too. 

Allegations of Poor Performance

JPMorgan’s basic argument is that Williams was a poor employee: someone who complained about so much, and whose performance was so sub-standard, that JPMorgan had legitimate grounds to fire her no matter what concerns she was raising about the compliance program. Says one passage in JPMorgan’s motion:

Far from retaliating against plaintiff, JPMorgan devoted an extraordinary amount of resources to considering, understanding, investigating, and responding to plaintiff about any concerns she raised… Nothing about plaintiff’s complaints, however, excused her from the legitimate consequences of her performance and behavioral deficiencies, or gave plaintiff license to act rude and unprofessional to coworkers, push her work onto others, or refuse to collaborate with key stakeholders.

Most of JPMorgan’s motion then went into painful detail about those alleged acts of rudeness and unprofessionalism. For example, when Williams flagged various concerns about JPMorgan’s third-party risk program to her supervisors, and her boss then asked how her proposed solutions might be implemented, Williams supposedly retorted, “Not my problem” and said more senior compliance executives could “have that battle.” 

JPMorgan also included evidence from Williams’ coworkers that they didn’t like working with her, either. For example, in 2019 one of her colleagues wrote to a more senior compliance officer: “I sent [Williams] an email ahead because I didn’t feel comfortable going to her desk … she doesn’t want anyone on the team talking to her so I would like to keep it on email basis going forward if that’s OK.” 

The rest of the response continues in that vein: lots of drama, lots of passive-aggressive office power moves, and enough names to fill out half the org chart for JPMorgan’s compliance program. Read it at your leisure; there’s no need for a full recounting of things here. 

Suffice to say (and as one would expect), JPMorgan lays out a vivid argument that it worked hard to address and accommodate Williams’ concerns; and ultimately fired her because of poor work habits — not for her raising concerns about ineffective compliance practices.

What About Williams’ Compliance Allegations?

Well, funny you should ask that question. Because JPMorgan’s response breezes right by the substance of Williams’ complaints about its compliance program failures, and whether she warranted protection under Sarbanes-Oxley and Dodd-Frank whistleblower protection statutes. 

The closest JPMorgan gets to talking about Williams’ substantive allegations — the poor policies and procedures, the lack of invoice controls, the weak due diligence — is to say that those issues are beside the point:

[T]here is no genuine issue of material fact sufficient to permit a finding that any alleged protected activity was a contributing factor in the termination of plaintiff’s employment and, in any event, JPMorgan has demonstrated by clear and convincing evidence that it would have taken the same adverse actions in the absence of any alleged protected activity.

Or, as JPMorgan said at another point in its motion: “JPMorgan does not contend that there is no genuine issue of material fact as to whether plaintiff engaged in any SOX protected activity at all. Rather, JPMorgan contends that no reasonable jury could find that any complaint relating to one of the laws enumerated by SOX was a contributing factor to any alleged adverse action.”

This raises an important question: Do SOX and Dodd-Frank whistleblower protections override a company’s right to fire for cause? Because if JPMorgan either wins this motion to dismiss or wins at trial, that will be a defense for every company facing a whistleblower suit going forward.

The lawsuit is also interesting because at the time of Williams’ employment, J.P.Morgan was still under a non-prosecution agreement for its “princeling” scandal, where the bank had given plum jobs to relatives of foreign officials in China and other Asia-Pacific nations. J.P.Morgan agreed to pay $264 million in penalties and disgorgement to settle charges, and had a three-year NPA that ran until November 2019.

So we have a compliance officer raising allegations about JPMorgan’s compliance program; and JPMorgan essentially answering that, yeah, whatever, this ex-employee was so bad we had a legitimate motive to fire her no matter what. The “what” being compliance program weaknesses while the bank was under a non-prosecution agreement for FCPA violations. 

What happens next? We’ll see. 

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