buyers. Additionally, Satloff recommended that Baravati sell the stock at the original asking price of $ 6.00 per share, although current market value was $ 5.00 per share.
In early February 1990, Baravati consulted an attorney from the Chicago office of the Securities and Exchange Commission ("SEC") about this situation. On February 15, 1990, JLR withheld Baravati's paycheck without explanation. Baravati contacted Dan Purjes ("Purjes"), Chairman and Chief Executive of JLR, about the paycheck. Purjes informed him to discuss the matter with Jacobson.
On February 22, 1990, the SEC contacted Jacobson. Jacobson questioned Baravati regarding the SEC inquiry. Later that day, JLR terminated Baravati. Baravati's second paycheck was subsequently withheld.
Jacobson submitted a Termination Request, dated February 14, 1990, to JLR's New York office. Termination was recommended for failure to follow company policy. Baravati had not been informed of these reasons for termination.
On February 26, 1990, Peter Scheib, company vice-president and a member of the JLR Board of Directors, completed, in accord with NASD regulations, a Uniform Termination Notice or Securities Industry Registration form ("U-5") on Baravati. On this form, Scheib indicated that Baravati had been terminated and was under internal review for "wrongful taking of firm property in the amount of $ 7,650.25." Furthermore, on March 9, 1990, JLR legal counsel wrote the Illinois Department of Labor, giving notification of Baravati's termination for cause on February 14, 1990. In this letter, JLR stated that Baravati owed the firm approximately $ 4900 for unauthorized trades.
On March 12, 1990, the NASD Surveillance Department notified Baravati that a review of his termination was in progress. One month later, a supervisor of examiners for the NASD wrote Baravati that the investigation had been completed and the matter was filed without action. None of the allegations warranted further NASD intervention.
Baravati filed an arbitration claim with NASD on February 6, 1991. In his complaint, Baravati alleged fifteen claims against JLR and its personnel, Purjes, Scheib, Satloff and Jacobson. These included retaliatory discharge, defamation, intentional interference with business expectancy, emotional distress, breach of implied covenant, lost commissions and quasi-contract. Baravati requested an award of $ 14,500,000 for actual, compensatory, and punitive damages, attorney fees and interest.
An NASD arbitration panel heard the claim in Chicago, Illinois. Both parties presented testimony in hearings that were held between March 1992 and October 1992. After consideration of the pleadings, testimony, hearing evidence, and post hearing submissions, the arbitrators found in Baravati's favor. The arbitrators made the following determinations:
1) JLR, Scheib, and Jacobson were jointly and severally liable for a sum of $ 60,000 in satisfaction of all of Baravati's claims;