Former Walgreen CFO sues company for defamation over forecast error

[October 17, 2014]  By Tanvi Mehta
 
 Oct 16 (Reuters) - Walgreen Inc's former Chief Financial Officer Wade Miquelon sued the drugstore operator on Thursday, alleging company executives defamed him in news reports that blamed him for errors in its earnings forecast.

Miquelon sued Walgreen in a state court in Chicago claiming that Chief Executive Officer Gregory Wasson and director Stefano Pessina, the company's biggest shareholder, had made "false and disparaging" comments about him in a report by the Wall Street Journal, court documents showed.

The Journal reported in August that Miquelon and another top executive lost their jobs after a $1 billion forecasting error in Walgreen's Medicare-related business..

A series of articles followed in the newspaper that said Miquelon "bungled" the company's EBIT forecast for fiscal year 2016.

They said his error required the company to cut by $1.1 billion its forecast of $8.5 billion in pharmacy unit earnings for the year ending August 2016, the newspaper said. (http://on.wsj.com/VEh0xC)

The newspaper report said the forecast error also led to the departure of Kermit Crawford, Walgreen's president of pharmacy, health and wellness.

Miquelon stepped down as chief financial officer on Aug. 4 after a six-year tenure.

According to court documents, Miquelon's decision to resign was "personal, based on his desire to pursue opportunities outside of Walgreen."

Miquelon further alleged that he had pressed Pessina to have Walgreen "publicly report the truth" but the drugstore operator had not done so.

In the suit, Miquelon said he was offered a promotion in April by Wasson and was told that if he accepted the offer, he would be in line to succeed Wasson as CEO.

Walgreen's spokesperson Emily Hartwig said the company does not comment on pending litigation.

The case is Miquelon v. Walgreen Co., 14-ch-16825, Cook County, Illinois Circuit Court (Chicago).

(Additional reporting by Yashaswini Swamynathan in Bangalore; Editing by Cynthia Osterman)

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