BREAKING NEWS: SCJ Wins $50K From Former Employee

SC Johnson is due $50,000—everything it asked for—from a former employee it sued over his taking company documents, disclosing them outside the company and publicly accusing the company of committing tax fraud.

SC Johnson sued Caledonia resident Michael DeGuelle about two years ago, saying he took company documents and shared them with others, breaking the confidentiality agreement he signed when he was hired.

The company also sued him for defamation, after he repeatedly accused the company in the media of committing tax fraud.

Jeffrey Leavell, an attorney representing SC Johnson, said in his closing argument that the company sought $50,000 from DeGuelle, a fraction of the $150,000 the company spent trying to repair its reputation. In Racine County Circuit Court this week, the company asked Judge Charles Constantine to award it $50,000, which he did – $100 was for the breach of contract, and $49,900 for the defamation.

"We know that the assertion of criminal conduct is the antithesis of doing what is right," Leavell said. "And it is different than saying someone used bad judgment.... The article itself wasn’t defamatory; it was Mr. DeGuelle statement that was defamatory. The company did nothing to cause that wrong."

DeGuelle never proved the company committed tax fraud. But he asserted during the trial that the company had filed amended tax returns after his termination and that in itself constituted criminal behavior.

Still, Constantine reminded DeGuelle frequently that he hadn’t filed any opposition to the facts contained in SCJ's summary judgment motions and that the IRS, even though SC Johnson had filed amended tax returns, did not view the company’s handling of its taxes constituted tax fraud.

While making his decision, Racine County Circuit Court Judge Charles Constantine called DeGuelle "single-minded." But Constantine pointed out that DeGuelle was "someone who was not going to change his point of view."

"There have been suggestions made that this court is biased, and that it was unfair that I was holding him to a certain standard because he is not a lawyer. At times, Mr. DeGuelle has shown a certain amount of disrespect for this court and I have, by conscious decision, decided to not rise to the level of taking his bait."

Still, DeGuelle accused Constantine of being "incompetent" and "in the pocket of SC Johnson."

"It was a shame the facts in the case could not be heard," DeGuelle said. "For some reason the judge believes that if you weren't charged with a crime, the crime did not happen. But the judge refused to allow those facts to be heard because they weren't in the form they wanted them in."

DeGuelle said he plans to appeal the decision. He’s also appealing the dismissal of a federal court case he filed that accuses SCJ of racketeering.

Kelly M. Semrau, senior vice president of global corporate affairs, communication and sustainability for SC Johnson, said the company was thrilled with the decision.

“This decision brings welcome closure to a two year process in which the judge ruled in favor of SC Johnson and dismissed all of DeGuelle’s claims against the company on April 15,” Semrau said. “We needed to protect the hard earned reputation of SC Johnson, as integrity and a high ethical standard are part of our core values on how we operate.”

According to the statement, the company plans to donate the $50,000 in damages to the Health Care Network, a non-profit agency providing free or low cost health care to residents of Racine County who are medically uninsured and have a limited income.

DeGuelle said he plans to appeal the decision. He’s also appealing a federal court case that accuses SCJ of racketeering.