Three former Hayes senior employees are suing the modem manufacturer for more than $40 million in a US bankruptcy court, charging founder Dennis Hayes with libel and fraud.
The claim by VP of sales Gary Franza and VP of product management John Stuckey follows their dismissal two weeks ago. In turn, both men are being sued by Hayes. The third former employee Mikhail Drabkin was VP for engineering and resigned at the beginning of March.
The libel claim centres around a company-wide email message that Dennis Hayes allegedly sent to 1,000 staff members explaining why both men had been sacked.
Their dismissal came during Hayes' long-running battle to come out of Chapter 11 protection. According to US sources all three men spoke out against Dennis Hayes during the US bankruptcy hearings.
Hayes came out of Chapter 11 protection in mid March, after a US judge agreed with its reorganisation plan, which had been contested by rival Diamond Multimedia.
The Hayes plan, which is backed by Northern Telecom and investment company Acma, means that Hayes can come out of Chapter 11 once its creditors have been paid off.
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