Ex-JP Morgan Broker Wins $60,000 and Expungement in Defamation Claim
An Indianapolis broker who lost his job at JP Morgan Securities for allegedly failing to verify a client’s suitability and risk requirements, and for failing to lock his office, was awarded $60,000 and a rewrite of the language explaining his dismissal on regulatory reports.
Jason C. Woodruff, who had worked for 19 years at various discount and bank-owned brokerage firms, claimed in June 2016 that the language JP Morgan put on his U5 forms following his termination after 20 months defamed and slandered him. He asked for a year’s salary and a revamped U5, according to Mark Maddox, a former Indiana securities commissioner who represented Woodruff at the arbitration.
The three-man panel granted him $60,000, which Maddox said was about half the annual compensation that Woodruff requested. The broker was not awarded punitive damages nor coverage of attorneys’ fees, but Maddox said cleaning up the U5 is a significant victory because it can reopen hiring doors for his client.
“The current [U5] language clearly operates as a bar, and any potential employer is not going to see that now,” said Maddox, noting that Woodruff was close to taking a job with another firm at the time he was dismissed.
JPMorgan alleged that Woodruff was discharged in April 2016 for entering “inaccurate information in an internal system after failing to verify the client’s suitability and risk tolerance” and for failing “to lock his office, leaving client information unsecured,” according to language on his BrokerCheck record. The arbitrators ordered the bank-owned broker to delete entirely the disclosure reporting pages on the U5 and to write that Woodruff was terminated “pursuant to the at-will aspect of (his) employment contract.”
The essence of Woodruff’s case was that a sales and a compliance supervisor pressured him to open a Roth IRA account to help a JP Morgan client make a tax deadline, even though he didn’t have all the information he needed for the form, according to Maddox. The supervisors were named as respondents in the complaint, but neither was ordered to pay damages by the three-person arbitration panel.
A JP Morgan spokesman said he could not immediately comment on the decision.
Woodruff, who began his brokerage career in 1996 at Olde Discount Corp., could not be reached for comment.