A federal jury in Charlotte will hear the case of a former high-ranking Wells Fargo executive who says he was wrongfully fired over the bank’s participation in Burger King’s $12 billion purchase of a Canadian restaurant chain.
On Friday, a judge granted the bank’s request to move the case to U.S. District Court in Charlotte, after former banker John Guenther filed his complaint in Mecklenburg County Civil Superior Court May 30. The judge gave the bank until Aug. 19 to formally reply before scheduling a trial date, court records show.
According to Guenther’s lawsuit, Wells Fargo fired him over “The Burger King Deal,” despite his “negligible role” in the transaction and his exemplary job performance over the years. He wants a jury to find that Wells Fargo should give him his job back.
The 2014 deal involved a foreign-exchange transaction to acquire the Ontario-based Tim Hortons chain.
In a statement to The Charlotte Observer on Tuesday, a Wells Fargo spokeswoman said the bank denied the allegations in the complaint and will “defend itself in court.”
In 2017, the Wall Street Journal reported that federal prosecutors in San Francisco were investigating foreign-exchange trading at Wells Fargo following the departure of four bankers in the unit.
The Journal said the issues in the foreign-exchange unit involved Ontario-based Restaurant Brands International Inc, the parent company of Burger King, Tim Hortons and Popeyes Louisiana Kitchen. Warren Buffett’s Berkshire Hathaway is a shareholder of Restaurant Brand International and Wells Fargo.
Guenther, however, said in the lawsuit that he and the other three executives were fired only after federal prosecutors began the investigation, about two years after the deal.
During the Burger King deal, Guenther was based in Charlotte as Wells Fargo regional sales manager and head of large corporate foreign exchange sales, according to his lawsuit. However, he said in the lawsuit, “the entirety of the events surrounding The Burger King Deal occurred in San Francisco” at the headquarters of the bank.
He said he received only positive job evaluations in the years following the transaction and was never given a reason for his firing, according to the lawsuit.
Code-named “Project Red” by Wells Fargo executives, the Tim Hortons deal represented “the largest foreign exchange transaction in Wells Fargo history,” according to Guenther’s lawsuit. Warren Buffet and a Brazilian financial sponsor, unnamed in the lawsuit, backed the deal, according to the complaint.
The deal reaped roughly $7 million for Wells Fargo’s foreign exchange sales and trading group, Guenther said in the lawsuit.
Wells Fargo acknowledged at the time that the departures were related to a single customer transaction, but did not identify the corporate client. The Charlotte Observer previously reported that the case involved a single customer who was aware of the matter, citing a source familiar with the situation.
Guenther said in the lawsuit that fellow Wells Fargo executives Bob Gotelli, Michael Schaufler and Simon Fowles also were fired. However, Sara Wardell-Smith, the executive in charge of such deals for the bank, inexplicably was transferred to manage a different Wells Fargo banking team in which she had no experience, according to the lawsuit.
As a result, Guenther said in the lawsuit, the bank discriminated against him based on his sex.
Guenther said in his lawsuit that because of his firing, no other company will hire him for an equivalent position. Guenther did not return a phone message left by the Observer on Tuesday afternoon.
During his time at the bank, he received five promotions because of his “work ethic, leadership, drive to succeed, and integrity,” according to his lawsuit.
Guenther also is “actively involved” in the Charlotte community, according to the lawsuit. He successfully completed a $13 million capital campaign at Trinity Episcopal School to endow scholarships for underprivileged children to attend the private school. He still serves on the school’s board of trustees.
From 2012 to 2014, he was board chair of the Johnston YMCA and served on the board for seven years, he said in the lawsuit.
His lawsuit also seeks back pay and benefits, and damages to be determined by a jury.
Fowles, the bank’s former head of foreign exchange trading, and Schaufler, the bank’s chief spot dealer who reported to Fowles, separately sued the bank in San Francisco County Superior Court in April 2018, according to court records and media reports.
Fowles said in his wrongful termination lawsuit that he was fired “because he planned to complain to regulators about the foreign exchange desk’s incentive-pay system” that could end in “fraud and clients being overcharged,” the Los Angeles Times reported when the lawsuit was filed.
The status of the lawsuits filed by Fowles and Schaufler was not immediately clear Tuesday night.