Federal judge blocks men who sued UBS for bias

Daily Record, The (Baltimore), Jul 14, 2008 by Brendan Kearney

UBS Financial Services Inc. has defeated a racial discrimination lawsuit brought by three former employees of the New York-based investment giant.

U.S. District Judge Peter J. Messitte granted summary judgment on behalf of UBS against the two Maryland plaintiffs, Freddie H. Cook and Sylvester L. Fleming Jr., last week, after granting summary judgment against Timothy J. Gandy of California last August.

The three black men had filed a putative class action alleging various forms of discrimination -- placement in a segregated satellite office, lack of support, and a "glass ceiling" effect with respect to promotions -- in federal court in New York in October 2005.

The case was transferred to Greenbelt, near the short-lived UBS office in Largo where Cook and Fleming worked. The plaintiffs dropped their class claims in April 2007, and a one-page order disposed of the remaining individual claims.

Messitte read his opinion from the bench on Tuesday, said Steven M. Pavsner, the plaintiffs' local counsel.

"The court said that it did not find that African-Americans were steered to Largo, and that was based on the testimony of Cook and Fleming that basically said they were willing to go to Largo," said Pavsner, noting that the men's request to work in the company's Washington, D.C., office was denied.

At the Largo office, Cook and Fleming, both financial advisors, alleged they were provided with an insufficient marketing budget and insufficient support staff, and that the supervisory corps at the startup branch was few in number and short on experience.

"With respect to the support issues ... the court said all those issues were business decisions and whether they were wise business decisions or not wise business decisions, the court was not going to second-guess," said Pavsner, of Joseph, Greenwald & Laake P.A.

The plaintiffs also were represented by the Philadelphia class- action law firm of Berger & Montague P.C., as well as a New York and Oregon firm.

UBS was represented by Covington & Burling LLP in Washington, D.C. One of the attorneys on the case, Jeffrey G. Huvelle, declined to comment.

In the lawsuit they sought to bring on behalf of "professional" blacks at UBS, the plaintiffs alleged "a glaring lack of diversity" at the company, noting only 1.2 percent of the 8,615 UBS brokers as of March 2002 were African-American.

They pointed to the Largo office, which opened in November 2000 and closed in June 2003, as an example of what Pavsner called "racial matching," or placing black financial advisors in the Prince George's County office to do business exclusively with black residents of that area.

UBS argued there was no proof of the "separate but equal" treatment alleged in the suit.

Seven other UBS employees filed a similar suit in May 2007. UBS settled six of the claims, as announced last month in a consent motion to dismiss with prejudice.

UBS' summary judgment motion regarding the seventh plaintiff, Mark Spradley, is pending before Judge Messitte.