Lawyers for ousted James Hardie CEO Jack Troung on the rise
Tussling with a former employer
It wouldn’t be the first time Mr. Truong’s personal legal counsel has argued with a former employer over separation disputes.
Mr. Truong, who had been managing director of the North American division of appliance maker Electrolux since 2011, abruptly left the company in April 2015, the same day the company warned of falling below expectations. of its division.
Prior to leaving Electrolux, Truong launched in 2014 a massive $ 3.3 billion takeover of General Electric’s home appliance division, which would make it the leader of the US home appliance market, replacing the dominant group. , Whirlpool.
However, in 2015, the US Department of Justice took legal action to prevent the merger on antitrust grounds.
According to documents filed in the U.S. District of Columbia court in September 2015, the government sought orders protecting Mr. Truong from Electrolux, which threatened to withhold severance pay from the former executive if he disparaged the company during the merger investigation.
Mr. Truong had signed a “separation and release agreement” with Electrolux, according to internal emails cited in court documents. Electrolux had also pressured Mr. Truong to accept the presence of Electrolux lawyers at his Justice Department testimony.
The Electrolux-GE saga
The Justice Department cited documents from Mr. Truong “suggesting that his investigative deposition testimony may have been affected by Electrolux’s delay in certain financial obligations to Mr. Truong until he testified ”, in which case Electrolux could“ assess the impact of his testimony ”on the legal attempt to block the merger.
“These documents had not been produced by Electrolux at the time of discovery (likely Electrolux withheld them under its working product claims),” the government said.
In a subsequent public hearing, Mr Truong said that Electrolux set the prices for its household appliances by referring only to GE Appliances and Whirlpool. This contrasted with the testimony provided by Electrolux that it also looked at other competitors, such as Samsung and LG, when setting prices.
On the eve of the December 2015 court ruling, General Electric abruptly abandoned the proposed merger, in a move the Justice Department called “a victory for American consumers.”
Although Electrolux said in April 2015 that Mr. Truong “had decided to resign from Electrolux in order to pursue other interests”, he did not join his next employer, Husky Injection Molding Systems, until February 2016.
Mr. Truong appears to have maintained a happier relationship with his former employer, 3M, an American multinational, where he worked for more than two decades.
James Hardie’s non-executive director Moe Nozari, another longtime 3M executive, abruptly resigned from James Hardie’s board this week following Mr Truong’s sacking.
In an interview in 2020, Mr. Truong described Mr. Nozari as “a wise man” and his “mentor for many years when I worked at 3M”.
James Hardie’s shares have fallen about 7 percent since Mr. Truong’s departure was announced last Friday.
The Australian Financial Review revealed this week that Mr. Hammes performed extensive background checks on Mr. Truong before promoting him to the role of chief executive.
This included hiring Korn Ferry to perform internal due diligence resulting from interviews with employees of James Hardie, who had worked with Mr. Truong since his arrival in 2017, as well as external due diligence on former employers of Mr. Truong, the American multinational 3M Group and Electrolux.
Under Mr. Truong’s leadership, James Hardie saw an increase in annual revenue of $ 400 million. Shares have climbed more than 363% since 2019. However, a number of senior executives had recently threatened to leave the company, prompting the company to follow up on complaints about Mr. Truong.
Mr. Hammes explained that Mr. Truong’s alleged violations of the company code of conduct were more recent.
“He has started, in the last few months, to treat people with disrespect, using intimidation, fear and humiliation, and it was not punctual,” Hammes told reporters. earlier in the week. However, this has been disputed by a number of James Hardie sources who spoke to the financial reviewer, who believe the company was aware of Mr. Truong’s alleged problems when he promoted him to CEO.