Trials & Litigation

Employees Turn Tables on Guess Jeans Co-Founder, Win $370M Counterclaim

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A lawsuit filed by the co-founder of the Guess? Inc. jeans company accusing five former employees of embezzlement has gone spectacularly wrong, resulting in a $370 million damages verdict this week for the defendant workers in their counterclaim against plaintiff Georges Marciano for defamation and harassment.

Los Angeles County Superior Court Judge Elizabeth White threw out Marciano’s 2007 lawsuit accusing the five of conspiring to steal from him as well as his response to the workers’ counterclaim after he repeatedly failed to cooperate with the proceedings, reports the Los Angeles Times.

White earlier found Marciano liable for defamation in a bench trial of the counterclaim. A jury then heard the damages portion of the case, deciding Monday that each former employee should be awarded $74 million, for a total of $370 million in damages, recounts Bloomberg. The verdict is the fourth-largest jury award so far in 2009, the news agency says.

Marciano, who earlier announced a plan to run for office as California governor, has meanwhile been campaigning against the judge, both suing her in federal court alleging constitutional violations and arranging for courthouse picketing against her, according to the two articles.

In addition to accusing the five former workers of stealing from him in a lawsuit, Marciano also reportedly made similar accusations to police and in written communications sent to others. One ex-employee, Steven Chapnick, says he had a hard time finding another job after Marciano sent out letters accusing him of fraud, the Times reports.

Marciano left Guess in the 1990s, and the five worked for him subsequently, Bloomberg notes.

The verdict is “a message to every employer out there that employees, even when they have been discharged, are entitled to respect and dignity and fair treatment,” attorney R. Rex Parris, who represented two of the winning workers, tells Bloomberg. However, he also says he expects Marciano to appeal.

Marciano declined through a spokeswoman to comment to the news agency.

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