The former chief financial officer of a Mount Pleasant, Texas-based trailer parts manufacturing company filed a federal lawsuit last week alleging gender discrimination and securities fraud.
Brandi Derrick alleges she was fired via a "Sunday evening phone call" in October 2016 after 10 years of employment as accountant and promotion to CFO at Big Fender Products Inc. Derrick, then 44, claims she was replaced by a man in his 30s.
Derrick said she met with the company's president, John R. McCollum, who informed her she was fired because she was dating a co-worker and that the relationship could reflect poorly on the company's reputation.
"Derrick disagrees insofar as the co-worker she had been seeing was entirely outside her chain of command. Derrick further asserts that BFP had neither a written nor unwritten policy prohibiting co-worker relationships and that several co-worker relationships have actually occurred in the past for which similarly-situated males faced no punishment," the complaint states.
Derrick alleges that female officers in the company were paid less than male officers, even newly hired ones, and enjoyed fewer benefits. Female officers were allegedly denied company cars to drive, even though they had to travel just as often between BFP plants in Northeast Texas and Southeast Oklahoma as male officers who were issued company cars.
Derrick believes she was terminated because of her gender, her age or both. Named as defendants in the suit are McCollum, company vice president O.C. Ross and company officers Jeffrey Jackson and Erin Thomas.
Derrick alleges that McCollum presented her, Jackson and Thomas with what he called a "unique opportunity" to own 10 percent of the company by purchasing 8,100 shares of already-issued stock from McCollum directly for $35 a share and that the sale was finalized in November 2015. Knowing that Derrick, Jackson and Thomas couldn't immediately pay $283,500 for the stock, McCollum offered to loan them the purchase price in exchange for a promissory note payable to McCollum.
Derrick alleges she was to pay $1,516.12 on the note monthly from "monthly dividends in addition to your salary, which will more than cover your monthly note payments."
The complaint alleges McCollum made "material misrepresentations" and is guilty of violating federal and state securities laws in a variety of ways. Derrick accuses McCollum of illegally brokering the deal with an eye on personal profits rather than the company's financial well-being.
According to the complaint, after selling 10 percent of his stock to the company's officers, including Derrick, McCollum transferred his stock and Derrick's promissory note to BFP in January 2016, after collecting Derrick's first monthly note payment, for "immediate cash and/or assets. Also on Jan. 4, 2016, McCollum signed a 'redemption agreement' wherein he claimed to own more shares of stock than what he had previously represented to Derrick on Nov. 12, 2015."
Derrick claims that despite being a 10 percent shareholder she is being denied her legal right to examine the company's books and records. Derrick alleges that since she was fired, "McCollum refused to declare and/or pay dividends for the malicious purpose of preventing Derrick from receiving any kind of profit from BFP and for the malicious purpose of lowering the value of Derrick's stock."
"By terminating Derrick and withholding dividends, distributions, profits and corporate rights from Derrick, that McCollum, Ross, Jackson and Thomas have breached their informal fiduciary duties to Derrick," the complaint alleges.
Derrick accuses McCollum of fraud and all defendants of conspiring to enrich themselves at Derrick's expense. Derrick also alleges that, as officers of the company, the defendants are liable to her for alleged gender/age discrimination.
Texarkana lawyer Cory Floyd filed the complaint Feb. 6 in the Texarkana Division of the Eastern District of Texas on Derrick's behalf. The suit seeks $2,673,000, the alleged value of Derrick's stock, according to documents signed Sept. 1, 2016. Derrick is also asking for back pay, reimbursement for lost benefits, compensation for job search expenses, attorney fees, court costs, witness and deposition fees, profits realized by McCollum and an order allowing Derrick and her lawyer access to the company's books and records.
The case has been assigned to U.S. District Judge Robert Schroeder III. BFP has not yet filed a response to Derrick's complaint.