THE BILLIONAIRE VS. HERMONEYMANAGER
A $24-million wrongful dismissal suit against a Thomson heir is poised to get messy
The richest woman in Canada and the chair of the Canadian Football League appear to be digging in their heels and priming their legal teams for what promises to be a very messy civil trial in Toronto next month, replete with allegations of self-dealing, forgery and downloads of “hard porn.”
Sherry Brydson, who as the granddaughter of Roy Thomson is an heiress to the Thomson fortune, five years ago fired James Lawson, who for eight years had run the investment company Westerkirk Capital Inc. Brydson is executive chair of Westerkirk’s board of directors.
In 2013, Lawson sued for wrongful dismissal, claiming $24 million in damages. Lawson argued that Brydson pushed him out because his efforts to run Westerkirk professionally, and invest its money for the best possible return, ran afoul of the family’s profligate and erratic style.
“Sherry Brydson conducts herself as if she is the head or matriarch of the Brydson family and the owner of Westerkirk,” Lawson argued in the claim. “Brydson was in fact only a minority non-voting equity participant.”
Brydson, who is worth a reported $6 billion, retained prominent employment lawyer Howard Levitt, whose team investigated every detail of Lawson’s time at Westerkirk. Brydson then filed a counterclaim, alleging that Lawson used his time at Westerkirk to enrich himself, while “ridiculing various family members as irresponsible, clueless, stupid and lazy to colleagues, subordinates and third parties.”
The counterclaim further alleges that Lawson had an assistant at Westerkirk forge his signature, and that he “utilized his office to indulge himself in hard core racist and misogynistic pornography.”
None of the allegations made by either party have been proven in court.
Lawson, who in addition to his CFL duties is chief executive at Woodbine Entertainment Corp., a horse-race track and slot machine complex in Toronto, has denied most of the allegations, though he admits he asked an associate to sign his name and that he forwarded pornography via email.
The court documents now overflow from two bankers’ boxes in the commercial court at the Canada Life Building on Toronto’s University Avenue.
Lawson says in his claim that he, “discharged his duties as CEO of Westerkirk faithfully, and in particular, ensured that investments weremadecarefullyafterappropriate due diligence.” But Westerkirk’s “amended reply to the defense to counterclaim and rejoiner” alleges that, “the only issue in this case is whether the serial misconduct, serial dishonesty and self-dealing of the plaintiff, James J. Lawson, is cause for his dismissal.”
A glimpse of the details that could emerge at trial appears in the transcript of a six-day discovery where Lawson and his lawyer, Paul Steep of McCarthy Tétrault, squared off against Levitt. Levitt read Lawson an email that the chief executive, while on a business trip with one of Brydson’s children, had written to a fellow employee at Westerkirk.
“Shuttle leaving for airport at 8,” Lawson wrote. “Called and he was sleeping. Runs in the family. I may end up leaving him elsewhere as I don’t intend to miss planes and appointments for this bullshit. Off to a good start.”
Levitt asked Lawson if he was ridiculing a family member in his email.
“I do not think that it was ridiculing him,” Lawson replied. “I would have said the same about any associate I was travelling with.”
Levitt also asked Lawson about pornography that he forwarded to other Westerkirk employees from his office email account.
“Do you agree that it is contrary to good corporate governance to circulate pornographic pictures and videos?” Levitt asked Lawson.
“I do not believe it is appropriate,” Lawson replied.
Lawson, who after university played two seasons with a Montreal Canadiens farm team, said he received the pornography from some of his hockey buddies. “The source of the pornographic material in almost every case was one particular hockey team and I asked them to stop on a number of occasions.”
Levitt then asked, “If you asked them to stop, why did you circulate it yourself?”
“I regret doing so,” Lawson replied. Lawson then added that the eight people in Westerkirk’s office — four women and four men — “had a very good, strong, respectful culture.”
During discovery, Levitt attempted to play several pornographic videos. “There are different levels of degradation,” he said. “Different levels of racism, bestiality, misogyny, of how hard porn they are.”
Steep refused to let his client view the videos. According to the court transcript, Levitt intends to play the tapes at trial.
In their counterclaims, Westerkirk’s lawyers have also zeroed in on a house in Florida that Lawson and his wife, Susan, bought while he worked at the investment firm. They allege that Lawson asked an associate to sign the CEO’s name on a building permit application for the home.
“Although the document was required to be signed by Lawson, he instructed Westerkirk’s office manager to falsify his signature on it and then lied to the notary in email that the signature was his,” the court documents allege.
Lawson confirms in court records that he asked office manager Wendy Wright to sign his name on the application, because he was travelling. He adds, “no one was prejudiced, harmed or misled in any way.”
Levitt, who is a columnist at the National Post, declined a request from the Financial Post to comment on the case. Steep also declined a request for comment.
The allegations also spill into Lawson’s current job.
Documents filed in court show that as chairman of Woodbine, he invoiced the race track for between $15,000 and $24,000 a month in the summer and fall of 2012, while he remained CEO of Westerkirk. Westerkirk says this billing proves that Lawson neglected his day job to spend time at the race track.
Lawson “denies that he breached any obligation to Westerkirk to provide full-time service. In his role as CEO he often worked long and irregular hours.”
As for Woodbine, Lawson told Levitt during discovery that, “I was round the clock on weekends and not taking any holidays trying to fulfil (my) duties at the racetrack.”
The trial arrives at a crucial time for Lawson, who has plans to develop a “city within the city” on 680 acres of land at Woodbine, near Toronto’s airport. Lawson also dreams of bringing a National Hockey League team to the complex.
B.C.-based Great Canadian Gaming Corp. and Toronto-based Brookfield Business Partners this month won the Ontario Lottery and Gaming Corp. bidding process to open a casino at Woodbine. That deal requires approval of Toronto council.
The Westerkirk v. Lawson trial begins Sept. 11.
I do not think that it was ridiculing him. I would have said the same about any associate I was travelling with.