Gary Heathcott, a former consultant for Little Rock-based Cranford Johnson Robinson Woods, filed a lawsuit Tuesday against the marketing firm, saying he is entitled to compensatory damages for losses that resulted from the firm's breach of its agreement with him.
CJRW terminated Heathcott's consulting contract in November 2017, alleging that he violated the company's acceptable methods and procedures and its published employee handbook, according to the lawsuit filed in Pulaski County Circuit Court.
The contract was terminated after a September 2017 directive from CJRW Chief Executive Officer Darin Gray for Heathcott to vacate the company's offices and to not contact any company employees because of complaints from staff, the suit says.
Heathcott says he confirmed on Sept. 13, 2017, with CJRW's director of human resources that there had been no previous complaints filed with the office regarding his conduct, according to the lawsuit. The suit alleges that the company did not follow its own procedures regarding the filing and investigation of harassment complaints.
Heathcott alleges that Gray, or someone acting on CJRW's behalf, actively solicited female employees to make complaints of harassment against Heathcott, and that employees who refused were subject to retaliatory action including discharge, according to the lawsuit.
As a consultant for CJRW, Heathcott says he acquired significant new business for the firm, including the Arkansas Health Insurance Marketplace, the Arkansas Economic Development Commission and the Arkansas Scholarship Lottery accounts, resulting in millions of dollars in additional revenue for the advertising and marketing outfit.
The lottery's award of a five-year, $34.5 million advertising contract to CJRW drew protests from two of CJRW's rival bidders, but the state's procurement director rejected the protests. In February 2017, CJRW pledged to keep the employees who work on the lottery and those who work for its client Oaklawn Racing and Gaming separate, officials for the lottery and CJRW said at that time.
A spokesman for CJRW declined to comment about the lawsuit on Tuesday afternoon.
"We do not provide response to potential or pending litigation," said Mark Raines, senior vice president and director of client services and public relations.
Heathcott, who resides in San Antonio, has been an advertising, marketing and public relations professional for more than 40 years and was the founder and owner of Heathcott Associates Inc., an agency that competed with CJRW, according to the lawsuit filed by attorney Stephen W. Jones of Jack Nelson Jones P.A. in Little Rock.
In 2015, CJRW acquired certain assets of Heathcott Associates, primarily its client list, and engaged Heathcott to serve as a consultant, to continue to play a role in the servicing of Heathcott Associates' clients and to help develop new business for CJRW, the lawsuit states.
The parties entered into a consulting agreement dated April 1, 2015, and it was Heathcott's intent to serve as a consultant for about six months to ensure an orderly transfer of his firm's accounts to CJRW, according to the lawsuit.
Desiring Heathcott's continued services, CJRW agreed to new and superseding consulting agreements on at least two occasions. The agreement was amended on Oct. 24, 2016, to increase Heathcott's salary to $234,000 a year and amended and executed as of Nov. 17, 2016, according to the lawsuit.
The amended deal would last up to five years and gave Heathcott "exclusive and sole right" to terminate it until Sept. 30, 2021 with 30 days' written notice to the Little Rock firm, according to the suit. The contract also gave CJRW the right to act on any violation by Heathcott of the agreement or of the employee handbook.
After Gray told Heathcott to vacate the premises in September, CJRW's board of directors held a special meeting on Nov. 15, 2017, to consider Gray's recommendation to terminate Heathcott's contract, according to the suit.
Heathcott claims that the meeting violated the company's bylaws and that the board's approval of his termination was invalid.
His lawsuit says that the company unilaterally terminated his agreement and that it unilaterally ceased paying him commissions for business already generated.
In addition to compensatory damages, Heathcott's lawsuit seeks punitive damages from CJRW for alleged computer trespass and conversion by exercising power over Heathcott's property in violation of his rights.
While Heathcott had an office on CJRW's premises, most of his equipment and furniture, including his personal desktop computer, were his personal property and his company's property, the lawsuit says.
Sometime after Sept. 13, 2017, agents of CJRW accessed his personal desktop computer without notifying him or without his permission, and the computer was rendered unusable for more than 12 months, the lawsuit claims.
When his computer equipment was returned to him at the end of November 2017, Heathcott said, he had the devices examined by a computer forensics expert who determined that CJRW may have embedded spyware on the computer in order to monitor his activities, the lawsuit alleges.
"Additionally, it was determined that all data on his computer had been downloaded to a separate system," the suit says.
NW News on 12/22/2018