March 7, 2022
In today's blog we come across the plight of an employee who believes that he was wrongfully terminated in retaliation for seeking leave to care for his newborn. The employee says that his termination violated the Family and Medical Leave Act and his civil rights. In response, the employer argues that business had turned sour, a trader needed to be fired, and, sadly, the new father was chosen for termination solely based upon sound business reasons. After the axe fell, the former employee sued for nearly $3 million in damages.
In a FINRA Arbitration Statement of Claim filed in October 2020 and as amended, associated person Claimant Wenzel asserted:
interference with rights under the Family and Medical Leave Act ("FMLA"); retaliation in violation
of the FMLA; discrimination based upon Claimant's gender in violation of Title VII of the Civil Rights Act ("Title VII"); discrimination based upon Claimant's gender in violation of the New York
State Human Rights Law ("NYSHRL"); discrimination based upon Claimant's familial status in
violation of the NYSHRL; discrimination based upon Claimant's marital status in violation of the
NYSHRL; discrimination based upon Claimant's gender in violation of the New York City Human
Rights Law ("NYCHRL"); discrimination based upon Claimant's marital status in violation of the
NYCHRL; and discrimination based upon Claimant's caregiver status in violation of the
In the Matter of the Arbitration Between Eric Wenzel, Claimant, v. Cantor Fitzgerald & Co., Respondent (FINRA Arbitration Award 20-03668)
Respondent Cantor Fitzgerald generally denied the allegations and asserted affirmative defenses.
At the conclusion of the FINRA arbitration hearing, Claimant Wenzel sought $2,998,274 in damages and $250,000 in attorneys' fees.
The FINRA Arbitration Panel denied all of Claimant's claims and offered this explanation:
Claimant's claims are denied in their entirety. Assuming that Claimant presented a prima facie
case of retaliation (which the Panel believes is a very close question), Respondent presented
valid business reasons for its decision to terminate Claimant's employment, i.e., that
deteriorating market conditions dictated a reduction in the number of traders employed on the
equities derivatives trading desk where Claimant worked, and that the manager who made the
termination decision had formed the opinion that among the traders then employed on the desk,
Claimant was the one least likely to succeed in contributing to Respondent's new business
model for profitability for the trading desk. Claimant failed to demonstrate that those stated
reasons were not Respondent's true reasons for the termination decision. As to the claim that
Respondent's leave policy was applied in a discriminatory manner, the evidence is clear that
Claimant received, and was paid for, all the leave he requested in connection with his caring for
a new-born child.
Bill Singer's Comment
First, let's add some context via FINRA's online BrokerCheck database as of March 7, 2022, which states that Wenzel was first registered in 2005, and that from September 2011 to June 2018, he was registered with Cantor Fitzgerald. BrokerCheck indicates that Wenzel "is not currently registered;" and there are not negative disclosures on his industry record.
Whether you agree or disagree with the FINRA Arbitration Panel's Award, at least give the three arbitrators credit for publishing an explanation. Also, I applaud the Panel for weighing the various issues in the lawsuit and despite ruling in Cantor Fitzgerald's favor, still showing some compassion by:
- waiving the $1,125 February 28, 2022, postponement fee that was generated by Claimant's postponement request;
- allocating the $1,125 postponement fees on a 50/50 basis of $562.50 per Claimant and Respondent;
- imposing the full $10,125 in pre-hearing and hearing sessions fees solely on Respondent
At issue in Wenzel v. Cantor Fitzgerald appears to be something akin to two sides of the same coin; and that coin was the undisputed termination of trader Wenzel by his employer Cantor Fitzgerald. As Wenzel argued the case, he was the victim of a wrongful termination in the form of an allegedly impermissible retaliation for asking for time off in order to care for his newborn. As Cantor argued the case, market conditions compelled the firm to terminate a trader and it was determined that when it came times for heads to roll, "Claimant was the one least likely to succeed in contributing to Respondent's new business model for profitability for the trading desk."
Wenzel argued that the decision to terminate him was truly retaliation and discriminatory. On a preliminary basis, the Panel wasn't fully convinced that Wenzel had even satisfied the bare minimum requirements of a prima facie case: "Assuming that Claimant presented a prima facie case of retaliation (which the Panel believes is a very close question). . ." For whatever reason, even somewhat tepidly conceding that Wenzel had (or may have) presented a prima facie case for retaliation, the Panel concluded that Cantor's version of events rebutted Wenzel's to the extent that the employer presented a valid business reason for its termination. Notably, the Panel found that "Claimant received, and was paid for, all the leave he requested in connection with his caring for a new-born child," and, to some extent, that factor may have helped tip the scale in the employer's favor.