Updated: Nov 24, 2020
Since January of 2007, Timothy King started senior vice president regional manager, market lead, and market president for U.S. Bank's Sacramento area. He managed the commercial banking business for the region. The commercial banking division worked with companies whose revenues were between $25.1 million and $750 million.
In the summer of 2007, King got involved in the "building deeper relationships" initiative (the initiative) to drive increased revenue; he was one of the core members of the initiative. King later trained employees on the initiative, including how to track the requirements in the tracking system called Siebel. He received strong annual performance reviews from 2007 through 2011. King substantially exceeded the majority of his financial goals in 2010 and 2011.
In November 2012, four people reported to King — Kim Thakur, John Flinn, Edgar Gill, and Caroline Kim — and King reported to Michael Walker, who reported to Kenneth Ladd. Thakur, Flinn, and Gill were relationship managers and Kim was King's administrative assistant. King had performance concerns as to Thakur and Flinn. According to King, Flinn was upset with him about the performance review ratings King gave him in 2012 and because King assigned a deal to Thakur rather than to him. Thakur had made several mistakes in 2012; King told her to look into a potential position in a different area of the bank because he was imminently intending to place her on a performance improvement plan.
In September, King also rescinded his prior recommendation to have Thakur join a nonprofit board due to his concern that she would not be employed with the bank in the long term.
On November 7, Thakur contacted Maureen McGovern, a human resources generalist for U.S. Bank, raising claims of gender discrimination and harassment against King. During the investigation of Thakur's claims, Thakur and Flinn made other allegations as well, including that King told them to falsify their expense reports and input meetings required under the initiative into Siebel when the meetings had not occurred. Based on the findings from McGovern's investigation, U.S. Bank terminated King's employment on December 27.
King sued U.S. Bank for defamation, wrongful termination in violation of public policy (citing Lab. Code, § 200 et seq.), and breach of the implied covenant of good faith and fair dealing.
The jury found in favor of King on all causes of action, submitting its findings to the court on a special verdict form.
Timothy King sued his former employer, U.S. Bank for defamation, wrongful termination in violation of public policy, and breach of the implied covenant of good faith and fair dealing after he was terminated following an investigation into claims of gender discrimination and harassment that were made against him by a subordinate employee (Kim Thakur) about whom “King had performance concerns.”
A jury awarded King $6 million on the defamation claim; $2.5 million on the wrongful termination claim; and $200,000 on the implied covenant claim. The jury also awarded King $15.6 million in punitive damages for a total judgment of $24.3 million. The trial court conditionally granted the Bank’s new trial motion subject to King’s accepting a remittitur, which would reduce the judgment to $5.4 million; King accepted the remittitur.
The Bank then appealed, and King cross-appealed. The Court of Appeal reversed the trial court’s new trial orders and, after conducting its “own independent review,” it concluded King was entitled to a one-to-one ratio of punitive to compensatory damages, resulting in the judgment being increased to $17.2 million ($8.6 million in compensatory and $8.6 million in punitive damages). The Court found the claims supported by substantial evidence, including evidence of Human Resources’ failure to properly investigate and its reliance on sources known to be unreliable or biased against King. Further, the Court found substantial evidence that the Bank wanted to terminate King in order to deprive him of his annual bonus. Morgado v. City & County of San Francisco, 2020 WL 5033169 (Cal. Ct. App. 2020) (after-tax mitigation income earned by wrongfully terminated employee may be deducted from front pay owed by former employer).
The case decision can be found here: