In 2012, Republican U.S. Senate candidate Bernie Moreno’s Porsche dealership hired a Virginia-based general manager with decades of experience selling German sports cars. A year and a half later, they cut ties with the dealership, and he went to court soon after, alleging that Moreno had failed to live up to the compensation package that had attracted him to Ohio.
From Hiring to Getting Fired
Before agreeing to take the job, Michael Falcone said in his complaint that he wanted to make sure the move to Ohio made financial sense. The offer on the table was $80,000 in base salary, plus a commission of 5% of the salon’s “total variable gross profit.”
In a further email exchange, Falcone pressed Moreno on the terms, and according to court documents, Moreno responded: “Just so we’re clear, you will be paid for ALL VARIABLE gross profits.”
Falcone signed the offer the next day and began work shortly thereafter. In his complaint, he describes working for several months before asking for documentation so he could double-check his commission. “Despite numerous requests,” Falcone argued, the company failed to provide sales information that would have helped him calculate what he was owed.
Furthermore, Falcone claims that after he began inquiring about his salary, his superiors responded and “embarked on a coordinated campaign to force Mr. Falcone’s resignation.”
Falcone was demoted from general manager to used car manager and relieved of his duties. In January 2014, after about a year and a half on the job, Falcone was fired. The company said he was fired due to unsatisfactory performance and “continuous reductions in staff.”
But this round of cuts was unusually narrow. Falcone was the only employee laid off.
Falcone claimed that the manager told him at the meeting that he would not receive his back pay unless he signed a termination agreement, which he did, albeit reluctantly, because he wanted to be paid and because he understood that the reduction in staff would qualify him for unemployment benefits.
He wasn’t given a copy of the form when we left, and Falcone got an unpleasant surprise when he emailed HR to ask for it.
“When HR emailed him a copy of the form, it was clear that the form had been altered after it was signed and without Mr. Falcone’s knowledge or consent,” the complaint reads. “Specifically, the line indicating that his termination was due in part to a permanent workforce reduction was redacted, leaving only an uncorroborated allegation of unsatisfactory performance as the sole reason for Mr. Falcone’s termination.”
To be eligible for unemployment benefits in Ohio, the employee must be unemployed. through no fault of your ownIf Falcone was fired for his accomplishments and nothing else, it could complicate his application.
Moreno’s answer
In court documents, Moreno provided a copy of Falcone’s signed offer sheet. He argued that Falcone could not claim that he relied on Moreno’s statements in the email when he signed the form the next day.
Falcone “cannot reasonably demonstrate that his June 28, 2012, communication with Mr. Moreno was based on a reasonable basis because he expressly signed the Compensation Plan on June 29, 2012, which set forth the terms of his monthly bonus,” Moreno argued.
Regarding Falcone’s firing, Moreno admitted that Falcone was the only person fired and that they changed the release form.
“Defendants acknowledge that the termination form was altered,” Moreno’s attorneys wrote, “but that was done to correct a mistake made by defendants and not to achieve a fraudulent purpose.”
But Moreno argued that even if they had committed fraud to get Falcone to sign the form, it would have been irrelevant. After all, Falcone was an employee under an employment contract.
Moreno’s salon “had the right to terminate his contract for any reason or no reason — regardless of whether he signed the form,” the filing states. “Therefore, it is irrelevant for (Falcone) to claim that he would have refused to sign the form if the only reason listed for termination was unsatisfactory performance.”
Although Falcone complains that the changes to the termination form jeopardize his unemployment benefits claim, “glaringly absent,” Moreno argued, “are any factual allegations that he was denied unemployment benefits as a result of signing the termination form.”
In March 2016, Moreno and Falcone reached an out-of-court settlement.
What now?
Speaking to reporters at a campaign event in Chillicothe, Moreno called Falcone a “good guy” but added that “in every business, someone doesn’t do their job, usually it’s not themselves who get blamed, it’s others who get blamed.”
“The lawsuit was filed by a disgruntled employee,” he added. “Like all companies, we end up settling these cases because it’s cheaper than going to court.”
Look at his hundreds of ecstatic employees, Moreno argued. Look at his the most significant awards in the workplace.
But for Moreno’s political opponents, the Falcone case is reminiscent of the wage theft cases filed against Moreno in Massachusetts. In that case, Moreno’s employees claimed he wrongly withheld pay 1.5 times. A court ordered him to keep documents related to the case but destroyed overtime reports. Moreno argued that the basic records were still intact, but a judge and jury were not fooled. He was ordered to pay more than $400,000.
In a statement, Ohio AFL-CIO President Tim Burga argued that “the Senate election in Ohio is easy. While (Democratic U.S. Sen.) Sherrod Brown cares about Ohio workers, Bernie Moreno continues to show them he only cares about himself.”
“With working people, your word is your guarantee,” he added. “Sherrod Brown’s word is good, whereas Moreno has proven he can’t be trusted.”
Tiffany Muller, president of End Citizens United, says the cases represent a “clear pattern.”
“Moreno’s record of wage theft should be disqualifying,” she said. “If he can’t be trusted as a business owner, how can he expect Ohio voters to trust him in the Senate?”
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