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Ex parte Barze

Supreme Court of Alabama

June 26, 2015

Ex parte Brian Barze
v.
James S. Holbrook, Jr., and Sterne Agee Group, Inc. In re: Brian Barze

         Editorial Note:

         This Opinion is subject to formal revision before publication in the advanced sheet of the Southern Reporter.

          (Jefferson Circuit Court, CV-13-900763).

         WISE, Justice. Stuart, Bolin, Parker, Murdock, Shaw, Main, and Bryan, JJ., concur. Moore, C.J., concurs in the result.

          OPINION

         PETITION FOR WRIT OF MANDAMUS

         WISE, Justice.

         Brian Barze, the plaintiff below, filed a petition for a writ of mandamus requesting that this Court direct the Jefferson Circuit Court to set aside its July 23, 2014, order sealing a motion to stay filed by James S. Holbrook, Jr., one of the defendants below. We grant the petition and issue the writ.

Page 1013

          Facts and Procedural History

         On March 1, 2013, Barze filed in the Jefferson Circuit Court an action against Sterne Agee Group, Inc., and Holbrook, the then CEO of Sterne Agee. Barze included claims of promissory fraud and fraudulent inducement, breach of contract, conversion, and defamation. In his complaint, Barze alleged that, in spring 2009, Sterne Agee had approached him about leaving his old company and becoming the chief financial officer (" CFO" ) of Sterne Agee and that Holbrook had told him that, if he joined Sterne Agee, Sterne Agee would pay him severance pay of at least one year's salary and bonus if the job with Sterne Agee did not work out. Barze alleged that he relied on Holbrook's promises and representations when he agreed to accept the job at Sterne Agee and when he left his former employer and gave up his opportunities there. Barze asserted that, after he started working with Sterne Agee, he was presented with an employment agreement to sign; that Holbrook assured him that the employment agreement was signed by all employees; that Holbrook assured him that Holbrook could and would take care of Barze and honor their oral agreement regarding the severance pay of at least one year's salary and bonus; and that Holbrook told Barze that he was committed to Barze as the long-term CFO of Sterne Agee. Barze asserted that, in reliance on Holbrook's assertions, he signed the employment agreement.

         Barze asserted that Holbrook's primary instructions for him as CFO were " to protect Sterne Agee's bottom line profitability by reducing wasteful and abusive spending." However, he alleged that he later learned that " Holbrook use[d] Sterne Agee and its resources and corporate toys for Holbrook's own personal pleasure, thereby contributing enormously to the wasteful and abusive spending at Sterne Agee that detracts from its profitability." Barze further asserted that he learned that Holbrook used Sterne Agee funds to invest in business ventures without the approval of or disclosure to the Sterne Agee Board. He also alleged that Holbrook frequently " individually invested in the same ventures, receiving stock in connection with those investments" and that " Holbrook benefitted personally from Sterne Agee corporate investments that often resulted in losses for Sterne Agee." Barze asserted that he discussed with Holbrook the issue of Holbrook's wasteful personal use of Sterne Agee assets, but Holbrook told him the issue was none of Barze's concern. He also asserted that Holbrook had threatened that, " if any employee in Barze's accounting department ever had access to Holbrook's Sterne Agee holding company expenditures, that person would be 'fired.'" Finally, Barze asserted that, on August 21, 2012, the interim human-resources director for Sterne Agee came to his office and told him that he was " 'let go effective immediately'" and that he was not given any reason for the termination of his employment with Sterne Agee.

         In his complaint, Barze asserted that, after his employment was terminated, Sterne Agee refused to pay him the severance pay Holbrook had promised him. He also asserted that he repeatedly requested return of the shares of Sterne Agee stock, or the bonds to which they had been converted, and other stocks he had purchased during his employment at Sterne Agee but that Holbrook and Sterne Agee refused to return that property to him. Barze further asserted that it appeared that Sterne Agee and Holbrook " have somehow unlawfully substituted the stock shares that Barze purchased with zero coupon bonds." Finally, he alleged that he had been defamed by Holbrook on numerous occasions.

Page 1014

          On July 18, 2014, Holbrook filed a motion for leave to file under seal a motion to stay Barze's action pending the conclusion of a criminal investigation and proceedings. Holbrook asserted that the matters addressed in his motion to stay involved information that would promote defamation and that would pose potential harm for third parties who were not parties to the litigation. On July 21, 2014, Barze filed an objection and response to Holbrook's motion for leave to file his motion to stay under seal. On July 23, 2014, the trial court entered an order granting Holbrook's motion for leave to file his motion to stay under seal and ordering the circuit clerk to seal Holbrook's motion to stay. Subsequently, Holbrook filed his motion to stay the underlying civil action pending a criminal investigation and proceedings, which the trial court granted.

         On September 3, 2014, Barze filed in this Court a petition for a writ of mandamus directing the trial court to vacate its order sealing Holbrook's motion to stay and directing the trial court to vacate its order staying the proceedings in the trial court pending the completion of the criminal investigation and proceedings. This Court denied the petition by order issued October 30, 2014, as to the trial court's order staying ...


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