By Chris Dolmetsch and Sridhar Natarajan
(Bloomberg) --A longtime Wall Street executive says he was lured out of retirement by Hunt Cos. with the promise of a multiyear, eight-figure compensation package only to find himself fired after he built an operational broker-dealer business.
William H. Jennings II, the former co-head of fixed income at Jefferies Group, sued the El Paso, Texas-based designer and developer of buildings in federal court in New York, seeking about $72 million in damages.
Hunt executives courted Jennings to build a broker-dealer business from scratch, then tried to renegotiate his contract which promised him at least $58.8 million over seven years, according to the lawsuit.
“Once Jennings delivered a fully functional, profitable and operational broker-dealer business that was fully equipped with resources, strategies, a business course and, importantly, a professionally staffed team Jennings handpicked from his contacts and goodwill, defendants aggressively attempted to retrade its carrot, quickly turning it into a stick,” according to the complaint.
Hunt tried to get Jennings to renegotiate the deal, and failed, according to the lawsuit. The company tried to get Jennings to resign, and failed. And, after “conflicting and sham, bad faith reasons” to fire him for cause, the company eventually terminated him without cause, Jennings said.
Brenda Christman, a spokeswoman for Hunt, didn’t immediately respond to messages seeking comment on the lawsuit.
At the start of this year, Jennings hired a team of credit salesmen and traders from the Japanese bank Mizuho Financial Group Inc. as Hunt Financial Securities looked to build out its fixed-income team. By Feb. 1, Jennings’s employment was terminated, according to the complaint.
Jennings got his start at Lehman Brothers in 1992. He joined Jefferies from Royal Bank of Scotland Group Plc in 2008 as a head of the asset- and mortgage-backed securities team. He rose to co-head the fixed-income division at Jefferies before he stepped down in January 2014 at the age of 47.
Jefferies had been pushed by U.S. prosecutors to dismiss Jennings as it was being investigated over trading abuses. Jesse Litvak, a trader in Jennings’s department, was convicted of securities fraud and started serving a two-year prison sentence in September.
Jennings was later suspended by the Financial Industry Regulatory Authority for three months and fined $30,000 for failing to properly supervise mortgage-bond traders. Jennings consented to Finra’s sanctions without admitting or denying its findings.
Litvak’s arrest preceded a broader crackdown on questionable trading practices by bond traders that led to criminal charges against more than a half-dozen traders and the departure of dozens more from their firms.
The case is William H. Jennings II v. Hunt Cos., 18-cv-01793, U.S. District Court, Southern District of New York (Manhattan.)
--With assistance from Bob Van Voris and Dakin Campbell.To contact the reporters on this story: Chris Dolmetsch in New York State Supreme Court in Manhattan at [email protected] ;Sridhar Natarajan in New York at [email protected] To contact the editors responsible for this story: David Glovin at [email protected] Joe Schneider, Elizabeth Wollman