Date: 06-18-2013

Case Style: James Cameron Peery v. Guaranteed Auto Finance, Inc. d/b/a Automaster

Case Number: CJ-2008-4072

Judge: Roger H. Stuart

Court: District Court, Oklahoma County, Oklahoma

Plaintiff's Attorney: Mark Hammons and Ryan M. Eitzmann

Defendant's Attorney: G. Rudy Hiersche, Jr., Justin T. Hiersche

Description: James Cameron Peery sued Guaranteed Auto Finance, Inc. d/b/a Automaster, Interstate Auto Group, Inc. d/b/a Car Hop, and First Cash Financial Services, Inc. on wrongful termination theories claiming:

1. The Plaintiff is Cameron Peery, an adult residing in Pottawatomie County, Oklahoma.

2. Th Defendant is Tulsa Auto Master (hereinafter “Auto Master”), a corporation or entity doing business in Oklahoma County, Oklahoma.

JURISDICTION AND VENUE

3. Plaintiff’s causes of action are based on retaliation in his employment for making reports of fraudulent activity and wrongful termination in violation of Oklahoma Oklahoma’s public policy against whistleblowing and retaliation for such reports, as articulated by the Supreme Court of Oklahoma in Burk v. K-Mart, 770 P.2d 24 (OkIa. 1989). Jurisdiction over the Plaintiff’s claims is therefore vested in this Court.

4. Allof the claims arose in Oklahoma County and the Defendant is located in and may be served in such county. Venue is therefore proper in this Court under 12O.S. §134.

STATEMENT OF FACTS

5. Plaintiff was hired by the Defendant on or about August 1, 2007, into the position of Sales Associate, and worked for Defendant in that capacity until the date of his termination, on or about February 19, 2008.

6. During his employment, Plaintiff’s supervisors instructed Sales Associates, including Plaintiff, to manufacture, falsify, and fraudulently pass documents to auto loan processors and underwriters for purposes of increasing auto sales and personal commissions for sales associates and managers.

7. As part of Plaintiff, and other Sales Associates’ and Managers’ duties, employees of Auto Master originated applications and documentation to submit to auto loan lenders for urposes of financing auto sales.

8. Defendant’s employees were trained and instructed to obtain numerous photocopies of jay stubs and financial information from purchasers and use exacta knives to create altered copies of the same financial information in order to reflect greater purchasing power and available credit for auto purchasers.

9. During Plaintiff’s employment, Defendant ran promotional “push, pull, or drag” programs in which purchasers were guaranteed trade-in value for vehicles which they could bringtto the Auto Master facility.

10. Defendant’s employees were trained to locate salvaged or abandoned vehicles, create: and falsify title certificates, and provide approved trade-in value to purchasers in efforts to qualify purchasers for financing at the expense of the lender, the dealer, and the public.

11. The methods described above were done as part of a scheme in which Plaintiff’s supervisors knowingly defrauded auto lenders providing financing, and in which Plaintiff’s supervisors knew or should have known that purchasers were likely to be underqualified borrowers likely to suffer repossession of their vehicles, thereby allowing Defendant to resell repossessed vehicles, thereby reflecting increased sales and commissions.

12. Plaintiff repeatedly complained to his supervisors that the fraudulent falsification of financial information of purchasers was wrong, was illegal, was unethical, and posed a risk to purchasers, to the public, and to both the lenders and the Defendant.

13. On or about February 19, 2008, Plaintiff informed his supervisors that he intended to submit an email to Auto Master executive/corporate officers and/or to the lenders and the public if the fraudulent behavior did not stop.

14. Or or about February 19, 2008, Defendant terminated Plaintiff.

15. A significant and motivating factor in the above-described acts was an intention to retaliate against Plaintiff due to his reports of fraudulent activity and falsification of financial records that could have resulted in damage to the auto lender, the public, and that could have resulted in civil liability to the company.

16. As a direct and proximate result of Defendant’s actions, Plaintiff has suffered injuries described hereafter.

COUNT I

For his first cause of action, Plaintiff incorporates all prior allegations and further alleges and states as follows:

17. The acts above-described constitute a violation of Oklahoma’s public policy which prohibits wrongful termination and retaliation against a whistle-blower for performing an act consistent with a clear and compelling public policy, i.e., refusing to participate in an illegal activity; performing an important public obligation; exercising a legal right or interest; exposing some wrongdoing by the employer; and performing an act that public policy would encourage or for refusing to do something that public policy would condemn: Plaintiff’s reports concerning fraudulent processing and origination of financial information, falsification of documents submitted to financial lenders, and criminal fraud give rise to a cause of action under Burk v. K-Mart, 1989 OK 22, 770 P.2d 24.

18. As damages, Plaintiff has suffered lost earnings, past and future, and other available dompensatory damages.

19. Bebause the actions of the Defendant were willful, wanton or, at the least, in reckless disregard of Plaintiffs rights, Plaintiff is entitled to punitive damages.

PRAYER

WHEREFORE, Plaintiff prays that this Court enter judgment in favor of the Plaintiff and against the Defendant and assess actual, compensatory and punitive damages together with pre- and postjudgment interest, costs, attorney’s fees and such other relief as this Court may deem equitable and appropriate.

Defendant Tulsa Auto Master appeared and answered as follows:

1. Defendant is without sufficient information to admit of deny the allegations of paragraph one and would therefore leave Plaintiffwith its burden ofproofat the time ofthe trial of this matter.

2. Defendant denies the allegation contained in paragraph two of the Petition since Tulsa Auto Master is not the correct Defendant ( See paragraph Si).

3. Defendant specifically denies the allegations contained in paragraph three insofar as it alleges that jurisdiction is proper in this Court, and that Defendant wrongfi.illy tenninated Plaintiff.

4. Defendant denies that venue is proper before this Court as alleged in paragraph number

4 of the Petition and demands strict proof thereof

5. Defendant denies the allegations contained in paragraph 5 of the Petition and would affirmatively state Defendant hired Plaintiff on July 3 1. 2007 and terminated his employment on February 19, 2008..

6. Defendant denies each and every allegation contained in paragraphs 6 through 13 inclusive and demands stñct proof thereof

7. Defendant would admit the allegations contained in paragraph 14 of the Petition.

8. Defendant denies each and every allegation contained in paragraphs 15 through 19 inclusive and demands strict proof thereof.

Affirmative Defenses

8. In addition to the above Answer, Defendant asserts the following Affirmative Defenses which are a complete bar to Plaintiffs recovery.

i) The proper party Defendant is Guaranteed Auto Finance, Inc., d/b/a Auto Master, not Tulsa Auto Master.

ii) That on or about July 31, 2007, Plaintiff and the Defendant did enter into an employee arbitration agreement, a copy of which is attached hereto and marked Exhibit “A”. By the very terms of said employee arbitration agreement, the parties voluntarily agree not to utilize the judicial system, but to settle any dispute between themselves by binding arbitration. Based on such agreement, this Court should not hear this matter and Defendant requests that this matter be dismissed, or in the alternative stayed, until such time as an arbitration can be conducted.

iii) Statute of Limitations;

iv) Any damage suffered by Plaintiff was the result of his own independent and unsolicited acts, and not the acts of this Defendant;

v) Plaintiff was an employee at will and subject to being terminated without notice and without cause;

vi) Statute of Frauds;

vii) Plaintiff has not suffered any damage because of the acts of this Defendant.

WHEREFORE having fully answered. Defendant prays that this Court determine that it should either dismiss or abate this action until such time as the parties have submitted the mtIr.tq binding arbitration, and if and when the Court ever hears the issues of this matter, the Pljiiififftake’ nothing by way of its Petition on file herein and that this Defendant be allowed to go Ørth with its) costs.

The Pre-Trial Order provided in part:

Plaintiff’s claims are based on retaliation in his employment for making reports of fraudulent activity and wrongful termination in violation of Oklahoma’s public policy against whistleblowing and retaliation for such reports, as articulated by the Supreme Court of Oklahoma inBurkv. K-Mart, 770 P.2d 24 (Okla. 1989). Jurisdiction overPlaintifi’s claims is therefore vested in this Court.

3. Plaintiffs Contentions:

1. During his employment, Plaintiffs supervisors instructed Sales Associates, including Plaintiff, to manufacture, falsify, and fraudulently pass documents to auto loan processors and underwriters for purposes of increasing auto sales and personal commissions for sales associates and managers.

2. Defendant’s employees were trained and instructed to obtain numerous photocopies of pay stubs andfinancial infornrntionfrom purchasers and use exacta knives to create and alter copies of the same financial information in order to reflect greater purchasing power and available credit for auto purchasers.

3. Defendant’s employees were trained to located salvaged or abandoned vehicles, create and falsifS’ title certificates, and provide approved trade-in value to purchasers in efforts to qualify purchasers for fmancing at the expense of the lender, the dealer, and the public.

4. The methods described above were done as part of a scheme in which Plaintiff’s supervisors knowingly defrauded auto lenders providing financing, and in which Plaintiff’s supervisors know or should have known that purchasers were likely to be underqualified borrowers likely to suffer repossession of their vehicles, thereby allowing Defendant to resell repossessed vehicles, thereby reflecting increased sales and commissions.

5. Plaintiff repeatedly complained to his supervisors that the fraudulent falsification of financial information ofpurchasers was wrong, was illegal, was unethical, and posed a risk to purchasers, to the public, and to both the lenders and the Defendant.

6. On or about February 19, 2008, Plaintiff informed his supervisors that he intended to submit an email to Auto Master executive/coqorate offices and/or to the lenders and the public if the fraudulent behavior did not stop, at which time Defendant terminated Plaintiff.

7. A significant and motivating factor in the above-described act was an intention to retaliate against Plaintiff due to his reports of fraudulent activity and falsification of financial records that could have resulted in damage to the auto lender, the public, and that could have resulted in civil liability to the company.

8. The acts above-described constitute a violation of Oklahoma’s public policy which prohibits wrongful termination and retaliation against a whistle-blower for performing an act consistent with a clear and compelling public policy, i.e., refusing to participate in an illegal activity; performing an important public obligation; exercising a legal right or interest; exposing some wrongdoing by the employer; and performing an act that public policy would encourage or for refusing to do something that public policy would condemn. Plaintiff’s reports concerning fraudulent processing and origination of fmancial information, falsification of documents submitted to financial lenders, and criminal fraud give rise to a cause of action underBurk v. K-Mart, 19890K 22, 770 P.2d 24.

* * *

4. Defendants’ Contentious:

1. Matter is not properly before this court and matter should be stayed pending binding arbitration pursuant to an agreement entered into on July 31, 2007, which is an employee arbitration agreement.

2. Defendant admits that it terminated Plaintiff, but denies it was done wrongfUlly.

3. Defendant was an “at will” employee and was subject to termination without notice and without cause under Oklahoma law.

4. Plaintiff failed to perform his work assignment and was disruptive to the work force. Any damage suffered by Plaintiff was a result of his own independent actions and not acts of Defendant.

5. Plaintiff did not suffer any damage as a result of his termination by Defendant, and became gainfully employed immediately after.

Outcome: NOW, on this 29th day of March, 2013, there comes on for hearing the cross-motions for summary judgment of the Defendant First Cash Financial Services, Inc., and the Plaintiff, James Cameron Peery. Each party seeks a determination that First Cash Financial Services, Inc., is or is not liable for the actions of Guaranteed Auto Finance, Inc. First Cash appears by its counsel G. Rudy Hiersche, Jr., and the Plaintiff appears by his counsel Mark Hammons. The Court having heard the argument of counsel and having reviewed the briefs and submissions by each party, denies each motion and determines that factual controversy preclude the resolution of that issue by summary judgement.

Plaintiff's Experts:

Defendant's Experts:

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