SAN DIEGO (AP)-Qualcomm Inc. is trying to recover $573,527 in legal costs from former employees who sued the company, claiming they were denied stock options when Qualcomm sold a division to L.M. Ericsson in 1999.
Gary LeBlanc, Vincent Malgapo and Ron North signed releases assuring the San Diego-based wireless communications company they would not sue when they were transferred, Qualcomm lawyers said in a motion filed last week.
In exchange for signing the releases, they received a portion of their stock options. Later, LeBlanc, Malgapo, North and more than 800 co-workers joined a class-action lawsuit against Qualcomm, saying they signed the releases under duress. The suit said plaintiffs lost $400 million total in unvested stock options.
LeBlanc, 56, of Cardiff, and now an Ericsson maintenance worker, told the San Diego Union-Tribune for Tuesday editions, he was stunned at the lawsuit.
“I just wanted my due. For that I’m being punished. Really, I don’t have $500,000 so they can take what they can get and bankrupt me,” LeBlanc said.
Bill Sailer, Qualcomm’s vice president and general counsel, said the company is motivated by principle.
“These people agreed not to sue us, and then did sue us, even after we fulfilled our side of the bargain,” Sailer said.
The company had tried to appease workers in 1999 with a bonus retention plan that gave them a portion of their stock options. Although 97 percent of the 1,100 employees transferred to Ericsson signed releases, most went on to sue.
Superior Court Judge John S. Meyer granted the suit class-action status last September. Then, on Dec. 8, Meyer excluded 800 workers, saying those who signed the releases had ratified the deal by failing to return any of the money Qualcomm had paid to them. That action, combined with voluntary withdrawals, reduced the case to just 36 former employees.
Qualcomm is seeking legal fees from the lead plaintiffs, who have since been dismissed by Judge Meyer from the class-action. Under law, only the lead plaintiffs, including Thomas M. Sprague, a former Qualcomm vice president, can be held accountable.
Michelle Ciccarelli, a plaintiffs’ attorney, said they will fight Qualcomm.
“We will vigorously defend against the motion for attorneys’ fees and costs,” Ciccarelli told the Union-Tribune.
The trial for the breach of contract is set to begin Feb. 16. Meyer will deal with the matter of attorneys’ fees at a hearing on March 9, after the trial is completed.
