Consumer Fraud

Whistleblower files retaliation lawsuit against JC Penny

whistleblower 1 370x210 Whistleblower files retaliation lawsuit against JC PennyA former JC Penny employee has filed a retaliation lawsuit against the retail giant, alleging it retaliated against him for voicing concerns over practices, he says, were designed to cheat customers.

Robert Blatchford, who worked in JC Penny’s custom decorating department in St. Petersburg, Fla., between 2007 and 2009 and again on a part-time basis from August 2012 to July 2013, filed a complaint against the company under Florida’s Private Whistleblower Act, which prohibits employers from retaliating against an employee who discloses, threatens to disclose, objects to, or refuses to participate in a violation of the law.

According to Fortune, Mr. Blatchford claims that during his 2012-2013 employment, he complained that JC Penny was routinely charging customers full price for sale items and collecting sales tax on nontaxable items. He voiced his concerns about these alleged practices to CEO Ron Johnson and Human Resources director Dan Walker, mostly by email.

Records show that in March 2013, JC Penny noted, “We have discussed our investigative results with management and they have addressed or will address them accordingly.” However, Mr. Blatchford, dissatisfied with the company’s efforts to correct the alleged fraud, made his claims public and even talked about them on the Today Show in July 2013.

In response, JC Penny terminated Mr. Blatchford’s employment and sued him for theft of trade secrets, based on claims he made that he possessed company information that backed his allegations. JC Penny dropped its lawsuit against Mr. Blatchford a couple months later for unknown reasons.

Mr. Blatchford claims JC Penny has tarnished his reputation and made it difficult for him to find work. He filed an arbitration claim against the company in February, alleging the company lashed out at him for opening his mouth about the alleged fraudulent practices.

Fortune notes that it isn’t clear whether Mr. Blatchford has a solid case, but says that lawyers plans to subpoena Mr. Johnson, who resigned under pressure in April 2013 amid dramatically plummeting sales under his leadership, and Mr. Walker. If that happens, both men may have to give deposition testimony in court, which could drag the company’s troubled past into its ongoing efforts to become profitable again.