Fish oil firm ordered to pay $1M to former manager forced from job
Blair Rhodes | CBC News | Posted: February 3, 2017 8:24 PM | Last Updated: February 3, 2017
Ocean Nutrition employee Dave Matthews missed large payout when Nova Scotia company sold next year
A fish oil company has been ordered by a Nova Scotia judge to pay a former senior manager more than $1 million after he was forced from his job and missed out on a large payout when the firm was sold the next year.
Chemist Dave Matthews resigned from Ocean Nutrition Canada Ltd. in 2011 after he said he'd been progressively stripped of his responsibilities at the Dartmouth, N.S., company, circumstances that amounted to constructive dismissal.
In a decision released this week, Nova Scotia Supreme Court Justice Arthur LeBlanc agreed. He ruled Matthews is owed $1,086,893.36, his share of an executive incentive plan paid out when Ocean Nutrition was sold in 2012 to Dutch multinational Royal DSM N.V. for $540 million.
The 107-page ruling also offers a glimpse into some of the corporate machinations at the company, which produced Omega 3 health products and dietary supplements out of fish oil.
Duties taken away
Matthews is an expert in the extraction of Omega 3 from fish, and helped design and build manufacturing plants in Nova Scotia and Peru.
He joined the predecessor of Ocean Nutrition in 1997. Matthews said his problems at the company began in 2007 when Daniel Emond was hired as chief operating officer and began taking duties away from him.
Emails and other internal communications introduced at the trial show friction between managers, much of it involving Emond.
"Daniel Emond was, to say the least, an unsatisfactory witness," LeBlanc noted in his decision.
"His testimony was self-serving and deceitful. Defensive and evasive on cross-examination, Mr. Emond's unwillingness to concede even the most minor points severely undermined his overall credibility."
'Dishonesty' source of tension
An email sent to Emond by another senior executive at the time, CEO Robert Orr, showed some of the internal issues.
"I do not think it inspires confidence in the senior team when you do not include/consult other senior managers on such key decisions — 'do as I say' on improving interdepartmental communications 'not as I do,'" Orr wrote.
"But even more significantly the fact that you have not reviewed these things with me is very troublesome to me."
LeBlanc noted Orr's frustration in his ruling.
"I accept Orr's evidence that Emond's communication skills and dishonesty were a recurring source of tension between them while Orr was CEO," the judge wrote.
John Risley gets involved
Even high-profile investor John Risley, president of Clearwater Seafoods, then the largest shareholder in Ocean Nutrition, got involved. When Matthews served notice that he was resigning, Risley sent an email to other members of the company's board.
"This is bad news as he may well be going to a competitor who may have offered to make him whole in respect of his LTIP," Risley wrote, referring to the long-term incentive plan that would be paid out to executives if Ocean Nutrition was sold.
"I spoke to him on the weekend and he is very unhappy with how he feels he has been treated."
Matthews argued he was forced out, in part, because the company wanted to deny him the incentive.
Matthews's workload cut
Toward the end of his time at Ocean Nutrition, most of Matthews's responsibilities had been transferred to other managers, to the point where he only had about two hours of work to do a day. This, he argued, amounted to constructive dismissal.
"I have no difficulty concluding that a reasonable person in Dave Matthews's position would feel that the essential terms of the contract had been substantially changed," LeBlanc wrote in his decision.
"Any employee who had previously mentioned to their superior that they could use more work, only to have their workload further reduced to one to two hours per day, without prior consultation or any suggestion that alternate work was forthcoming, would feel that the employer had substantially changed the employment contract."