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JORDAN v. METROPOLITAN LIFE INSURANCE CO.

August 14, 2003

KENNETH JORDAN, PLAINTIFF, AGAINST METROPOLITAN LIFE INSURANCE COMPANY, DEFENDANT


The opinion of the court was delivered by: Shira Scheindlin, District Judge

AMENDED OPINION AND ORDER
On September 27, 2002, Metropolitan Life Insurance Company ("MetLife") terminated Kenneth Jordan and subsequently filed a termination report with the National Association of Securities Dealers ("NASD"). The report, referred to as a Uniform Termination Notice for Securities Industry Registration ("Form U-5"), states that Jordan was terminated due to his unethical conduct.

Jordan brings this action against MetLife seeking damages for: (1) defamation; (2) violation of the New Jersey "Whistle Blower Statute"; (3) age discrimination; and (4) retaliation.*fn1 He now moves for a preliminary injunction ordering MetLife to amend the Form U-5 and enjoining MetLife from making [ Page 2]

defamatory statements to his clients. For the reasons stated below, Jordan's motion is denied.

I. BACKGROUND

A. Jordan's Employment History

In December 1982, Jordan began working for MetLife as a Financial Services Representative ("FSR") at the Jersey Shore Financial Group (Jersey Shore Group") located in Tinton Falls, New Jersey. Complaint ("Compl.") ¶ 5. An FSR is responsible for finding prospective clients, learning about their family situation, objectives and financial needs, and assisting them in planning their financial futures. In the course of the relationship, the FSR advises the clients on various types of life insurance, annuities, or mutual funds and sells them the most beneficial financial instruments. Id. ¶ 6.

During Jordan's twenty-year employment with MetLife, he developed a personal client base of over 1,000 clients. See Jordan's Memorandum in Support of Motion for Preliminary Injunction ("P1. Mem.") at 5-7. In addition, he was nationally honored by MetLife for fifteen years, both for his productivity and his continued compliance with MetLife's ethical standards. Compl. ¶ 12.

In the spring of 2002, Jordan contacted MetLife's Regional Vice President, David Mancini, and requested a transfer out of the Jersey Shore Group because its management was [ Page 3]

committing, encouraging and allowing unethical and possibly illegal practices.*fn2 Id. ¶¶ 19-21. The alleged practices included forging signatures on policies and writing new policies for existing clients, which inappropriately generated new and substantial commissions for MetLife management to the detriment of the clients.*fn3 Id.

On September 27, 2002, a few months after Jordan alerted senior management to the unethical practices of the Jersey Shore Group, he was terminated. Jordan's supervisors — Chris Riddle, Managing Director, and Frank Dunn, Agency Director — claim that during the summer of 2002, they received customer complaints about Jordan's sales. Jordan allegedly engaged in the prohibited practice of replacement and "financing."*fn4 See Def. Mem. at 4. [ Page 4]

B. The NASD Form U-5

In order to sell variable life insurance, annuities and mutual funds, a dealer must be registered with the NASD. When a company such as MetLife, which is regulated by the NASD, terminates an NASD registered employee (e.g., Jordan), the company must file a Form U-5 with the NASD. See Pl. Mem. at 8. On October 2, 2002, MetLife filed a Form U-5 for Jordan in New York City, which accused Jordan of "misrepresentation of client policy values and policy options." Id. The next day, the NASD began an inquiry into MetLife's allegations and requested Jordan's response to the allegations, and on March 14, 2003, the NASD closed the inquiry without taking any action against Jordan. See id. at 10.

As a result of the Form U-5, Jordan claims that he has been "effectively blackballed" from the industry. Id. at 13. Jordan attempted to obtain employment with John Hancock Life and was told that the Form U-5 "make[s] it impossible for John Hancock or any like quality carrier to offer [Jordan] employment until the Metropolitan U-5 is amended." 4/15/03 Letter from Richard Davis, Associate General Agent of John Hancock, to Jordan ("Hancock Ltr."), Ex. 9 to Compl. In addition, Jordan claims that MetLife representatives have called many of his clients ...


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