In-depth coverage
The Springfield News-Sun has provided extensive coverage of EF Hutton America and its recent announcement to make Springfield its corporate headquarters. The paper has spoken to analysts, delved into the firm’s financial statements and its past history.
By the numbers:
400 — Jobs projected over five years
$22M —EF Hutton America’s proposed investment in Springfield
50 — Estimated jobs the company is looking to hire now
$1.5M to $1.7 million — Possible final value of proposed employment incentive agreement with the city of Springfield if approved
A former EF Hutton America executive has sued the firm in federal court, alleging the company failed to compensate him for at least two years of work.
Dennis R. White filed the lawsuit Tuesday in U.S. District Court in Pennsylvania, claiming the company hired him in 2014 as president. The lawsuit alleges White served in that role for two years and provided assistance on strategic decisions, acquisition attempts and investments, among other duties.
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White’s lawsuit alleges the company didn’t pay him the promised $250,000 annual salary, bonuses, equity incentives and other benefits. The complaint seeks damages of more than $150,000, court costs and other expenses.
Chris Daniels, CEO of EF Hutton America, declined to discuss the lawsuit, citing pending litigation.
“Companies as you know get frivolous actions filed every day so as a result, we do not comment on anything of that nature,” Daniels said.
The company has purchased two downtown buildings, and said it plans to invest $22 million and add up to 400 new jobs in downtown Springfield over the next five years. Local leaders have said they hope the proposed new jobs and investment will spur future growth downtown.
The firm announced a set of financial products earlier this month, including online investment and trading options, although website problems plagued its launch. That site was still not operating Thursday afternoon, although company officials have previously said the site is being retooled based on feedback from customers and will be back online in the future. Daniels declined to discuss the site Thursday.
DETAILS: Springfield’s EF Hutton; an historic brand, a new company
The complaint says White worked for the firm as late as last month, when he spoke with elected officials from Springfield and Ohio and gave a “motivational speech about the culture of excellence and integrity at EF Hutton and the pride of EF Hutton alumni.”
A Sept. 2 news release announcing the company’s new headquarters in Springfield also refers to White as a designated operating president, according to the lawsuit. But on Sept. 6, just a few days later, the complaint alleges the company converted his role from president to a mid-level marketing position.
The lawsuit claims the new terms were unacceptable and served as White’s wrongful termination. The court records say the company also removed White as a director after he requested the company honor its agreement.
It also alleges White relied on false information from the company when he decided to buy company stock and serve the firm in the expectation of receiving additional stock and options.
The complaint says White has more than 35 years experience in the financial services industry. It alleges Daniels enticed him to join the business in an effort to establish the new financial services company in the fall of 2014 by entering an agreement in which he would be president and receive various benefits.
His role would be to plan the company’s strategic direction, market the firm to financial advisers, assist Daniels in internal and external communications, and establish policies and procedures. He would also work remotely and establish a West Coast office for the company.
The lawsuit describes the firm as a digital financial platform expected to provide “products, services and information, including, but not limited to, trading and investments.” EF Hutton America’s digital financial platform is intended to complement its Gateway product, described as an Internet marketplace developed over nine months to connect customers with a range of financial providers.
The lawsuit also alleges EF Hutton America has no direct employees and operates through a subsidiary called EF Hutton Financial Corp.
Daniels addressed members of the Springfield Rotary Club earlier this month, saying the firm now has a dozen employees and has said it's actively looking to fill more than 50 positions, ranging from registered financial advisers to website developers and designers to multimedia production positions .
Company leaders, including Daniels, never intended to honor the agreement, White’s lawsuit alleges.
“EF Hutton knowingly or recklessly made false representations, through (Daniels), with no intention of honoring them, in order to induce (White) to provide his services, and to lend his name and reputation, to their nascent enterprise,” the lawsuit states.
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