San Diego Jury Awards Former Allstate Employee Over $18 Million

Wrongful Termination
Employment Law

By Sean Lally, Staff Writer

Michael Tilkey, a former employee of Allstate Insurance Co., received some relief earlier this month, when a San Diego jury awarded him over $18 million in damages. Tilkey, who had worked for the company for nearly three decades, was fired in 2015, after it had come to light that his girlfriend had filed charges against him. Tilkey was arrested, after being accused by his former girlfriend of threatening her. She later dropped the charges. Nonetheless, Allstate terminated Tilkey, citing the company’s prohibition against threats as the reason for firing him. Tilkey, thereafter, sued the company for wrongful termination and defamation.

The Leadup

The process began when Allstate discovered an email exchange between Tilkey and his ex. The company decided against pursuing an investigation; that is, until Tilkey’s ex sent an email to a CEO, revealing explicit details about the relationship. The termination soon followed, coming as a surprise to the former employee, who in 2014 explained the situation to Human Resources. That was the last time he spoke of it before being fired.

The Allegations

Tilkey and his lawyers made three claims in the initial suit. First, the plaintiff claimed, Allstate violated state law (California Labor Code Section 432.7) when it fired Tilkey for criminal charges that never resulted in a conviction. Second, Tilkey claimed the firing violated public policy, and third, he alleged that Allstate coerced him into public self-defamation.

The Award

The jury agreed with the first and third claims, awarding Tilkey $960,222 for wrongful termination and $1,702,915 for defamation. That makes for a total of $2,663,137 in compensatory damages. And since the jury deemed Allstate’s actions to be malicious, the plaintiff was awarded an extra $15,978,822 in punitive damages, making for a grand total of $18,641,959.


Joann Rezzo, Tilkey’s attorney, spoke about the jury’s reasoning: “The jury concluded that Allstate had violated Labor Code 432.7 when terminating Mr. Tilkey by basing its termination decision on records of his arrest and/or participation in a diversion program. The jury also determined that Allstate’s stated reason for the termination (i.e. alleged threats made by Mr. Tilkey) was not true and that Allstate failed to use reasonable care in determining the truthfulness of the stated reason for termination. The jury also concluded that Allstate had acted with malice, oppression and/or fraud (a prerequisite to an award of punitive damages).”

Allstate has said it disagrees with the outcome of the case and will pursue an appeal.

Déjà Vu

This isn’t the first time Allstate threw its employees under the bus. In 2016, the company was forced by a federal jury to pay four employees a total of $27 million for defamation. The employees worked for an equity division in Northbrook – a division which is now shut down – before they were fired in 2009 because, according to Allstate, they allegedly timed trades, costing the company $200 million over six years. The company claimed, in an SEC filing, that “some employees” had timed trades, resulting in major losses. Though Allstate never named the alleged culprits, the plaintiffs claimed that people could easily draw their own conclusions. According to the plaintiffs’ lawyers, the termination in 2009 “ruined their careers.” Unsurprisingly, Allstate disagreed with the jury’s decision.

Punished After Years of Labor

Wrongful termination is upsetting for people like Tilkey, who work for decades, shedding proverbial blood, sweat and tears in devotion to a company that, in the end, treats its employees as fungible. Shortly after obtaining a bachelor’s degree, Tilkey commenced employment with the company, and after several decades of hard work, he became a sales leader advising 30 employees. In fact, his productivity was impeccable. So when Allstate came knocking with a pink slip, it took him by complete surprise. Luckily, Tilkey was able to hire competent attorneys who helped him obtain just compensation.

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