The former chief financial officer for Royal Bank of Canada is suing the bank for almost $50 million over claims of wrongful dismissal.
Nadine Ahn said in a lawsuit that there is no merit to the allegations by RBC that she had an “undisclosed close personal relationship” with another employee who received preferential treatment.
RBC said in April that an internal review found evidence that the employee received a promotion and compensation increases as a result of the relationship, which violated the bank’s code of conduct.
In the lawsuit filed in the Ontario Superior Court of Justice on Aug. 8, Ahn denies providing preferential treatment to her colleague Ken Mason, and says RBC’s decision to fire her on April 5 was tainted in part by gender-based stereotypes about friendships between women and men.
The lawsuit claims there is a lack of supporting evidence for the claims against Ahn, that her termination came after a flawed and incomplete investigation process, and that it has resulted in a devastating impact on her reputation.
RBC spokesperson Gillian McArdle said in a statement that the claims are without merit and that the bank will vigorously defend itself against them in court.
“We conducted a thorough review with an investigation by outside legal counsel and the facts are very clear that there was a significant breach of our Code of Conduct based on the irrefutable evidence collected during the investigation,” she said.
While Ahn claims in the lawsuit that the bank rushed to fire her and name a replacement, McArdle said that given Ahn’s executive officer position, RBC was required to act quickly and publicly disclose what it did.
The $48.9-million lawsuit, first reported by Bloomberg, seeks damages for wrongful dismissal, damages for defamation, punitive damages and other claims.
Mason, the colleague with whom Ahn allegedly had a close personal relationship, was also fired on April 5.
He has filed a $20.3 million lawsuit on similar grounds as Ahn’s, including that his termination was based on false rumours, speculation and “discriminatory stereotypes based on heteronormative and sexist assumptions about male-female working relationships.”
Mason’s lawsuit said the bank’s code of conduct on close personal relationships is vague, creating opportunity for subjective, unfair application. The excerpts of the code listed in his lawsuit guide that such relations could be anything from family to intimate relationships to close friends.
He claims that while he and Ahn were friends and trusted colleagues, they did not have a close relationship as reasonably understood under the code.
Ahn’s lawsuit claims that the way the bank made the announcement of an “undisclosed personal relationship” caused the widespread belief that she and Mason — both of whom are married with children, according to their filings — were having an affair.
“The statement is false and was known, or ought to have been known by RBC, that it would both publicly humiliate Ms. Ahn and cause her extreme reputational harm and mental distress.”