Barnes & Noble Sued By Former CEO Over Termination

(RTTNews) - Retail bookseller Barnes & Noble Inc. (BKS) has been sued by its former Chief Executive Officer Demos Parneros for his termination in July over alleged policy violations.

In his lawsuit filed on Tuesday in Manhattan federal court, Parneros accused Barnes & Noble for breach of contract and defamation. He also accused Leonard Riggio, the founder and chairman of the company, for his "firing without cause" and for "falsely and irrevocably" damaging his reputation.

According to Parneros' complaint, Riggio became hostile to him after a deal to sell the company fell through in June.

Parneros added that a day before the announcement of his termination, he was told by Riggio that he would be fired for cause for violating the company's sexual harassment policy due to his alleged interaction with an executive assistant and "purported mistreatment" of Allen Lindstrom, the company's chief financial officer.

However, Parneros said he has not violated company policies and had "always conduced himself in a professional manner." He accused Riggio of being volatile and refusing to let go of control of the company.

Parneros added that he was owed severance as he was fired without cause. He is also seeking compensatory and punitive damages.

In response to Parneros' lawsuit, Barnes & Noble said Tuesday, "The lawsuit filed by Demos Parneros is nothing but an attempt to extort money from the Company by a CEO who was terminated for sexual harassment, bullying behavior and other violations of company policies after being in the role for approximately one year. The allegations contained in the complaint about Len Riggio are replete with lies and mischaracterizations."

When Barnes & Noble announced in early July that it terminated Parneros for violations of its policies, it did not specify them.

At that time, the company just said the termination was not due to any disagreement regarding its financial reporting, practices or any potential fraud. However, the company also said Parneros would not receive any severance payment.