Genberg v. Porter
935 F. Supp. 2d 1094
D. Colo.2013Background
- Genberg filed a Second Amended Complaint in 2012 alleging Colorado state defamation and SOX and DFA claims against Ceragenix and several executives.
- Ceragenix underwent a reverse merger and a Plan of Distribution leaving Ceragenix shares in a custodial account with voting rights allocated to Ceragenix’s Board.
- Genberg disclosed concerns about potential corporate and securities violations; Ceragenix launched an internal investigation headed by Redlich, who later issued reports about Genberg.
- Genberg was terminated for cause in March 2010; Porter communicated the termination and allegedly disparaged Genberg in the process.
- Genberg sought arbitration under his employment contract; bankruptcy proceedings of Ceragenix followed in 2010.
- The court addressed arbitration, SOX exhaustion, DFA retaliation, and summary judgment issues for Porter, Sperber, and others.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Arbitrability of non-signatories | Genberg argues non-signatories may be bound. | Defendants argue non-signatories are not bound absent alter ego or third-party beneficiary status. | Non-signatories are not bound; arbitration denied. |
| Exhaustion of administrative remedies for SOX claim against non-Porter defendants | Genberg exhausted via OSHA complaint naming Porter. | OSHA did not name Sperber, Bautista, Darnaud, Hoffman-Bray, Gastone; thus no exhaustion. | SOX claim dismissed against Sperber, Bautista, Darnaud, Hoffman-Bray, Gastone; but not against Porter. |
| DFA retaliation against Porter and Sperber | Genberg alleges post-termination wage withholding as DFA retaliation for reporting violations. | Bankruptcy and post-petition payments preclude DFA retaliation claim. | DFA claim against Porter and Sperber dismissed with prejudice. |
| Genberg's partial summary judgment on SOX against Porter | Genberg seeks judgment that his SOX claim against Porter is entitled to partial summary judgment. | Genuine issues of material fact exist regarding protected activity and causation. | Denied; issues remain for trial on SOX claim against Porter. |
Key Cases Cited
- Communications Workers of Am. v. Avaya, Inc., 693 F.3d 1295 (10th Cir. 2012) (arbitration boundaries and who may be bound to arbitration)
- AT&T Tech., Inc. v. Comm. Workers, 475 U.S. 643 (1986) (arbitration agreement scope and enforceability)
- Smith v. Multi-Fin. Secs. Corp., 171 P.3d 1267 (Colo. App. 2007) (non-signatories and arbitration under contract principles)
- Arthur Andersen LLP v. Carlisle, 556 U.S. 624 (2009) (agency/alter ego considerations in binding arbitration)
- Denver v. Dist. Court, 939 P.2d 1353 (Colo. 1997) (statutory interpretation and third-party beneficiary concepts)