Lawsuit: Cowen Fired Top Investment Banker Who Raised Concerns About the Bank’s Business Ties to Russian Oligarch Vitaly Malkin

Wigdor LLP represents investment banker Kevin Rollag in connection with a Sarbanes-Oxley Act Complaint filed with the Occupational Health and Safety Administration (“OSHA”) against Cowen Inc. and Cowen and Company LLC (together, “Cowen”).  Also named Respondents in the Complaint are Gavin O’Reilly and Scott Lemone, Managing Directors at Cowen.

Wigdor LLP has also filed a Complaint with the U.S. District Court for the Southern District of New York (“SDNY”), No. 1:20-cv-05138, against Cowen, Mr. O’Reilly and Mr. Lemone, alleging violations of the Family and Medical Leave Act and the New York State and City Human Rights Laws.

Cowen is accused of unlawfully retaliating against Mr. Rollag in response to his protected complaints regarding the Bank’s prospective business relationship with Belleville Management (“Belleville“) and its owner Vitaly Malkin, a Russian-Israeli oligarch and former Russian senator who is reputed to be engaged in money laundering and arms dealing, culminating in Mr. Rollag’s unlawful termination.

As set forth in the lawsuit, Mr. Rollag joined Cowen in May 2018 as a Vice President within its Mergers & Acquisitions (“M&A”) group and was promoted to Director of Investment Banking after just eight months at the Bank. Mr. Rollag was a strong performer at Cowen who was noted for his “exemplary relationship skills” and was tasked with helping build its Cannabis Investment Banking team, the lawsuit states.

Around September 2019, Cowen was engaged by medical marijuana supplier Clever Leaves to help arrange its Series E capital raise and funding round, the lawsuit states. When Belleville was introduced as a potential investor, Mr. Rollag promptly and dutifully objected to the Bank accepting its investment funds based on information that Belleville was the personal investment vehicle for Mr. Malkin, and therefore any investment from Belleville could potentially expose Cowen and its client to significant legal and reputational risk, the lawsuit alleges.

As alleged, Mr. Rollag repeatedly raised his concerns both verbally and in writing about Belleville and Mr. Malkin, however Cowen continued to pursue investment from Belleville as part of the Series E funding round, even after the Bank’s internal AML/compliance vetting process discovered possible red flags with Mr. Malkin and/or Belleville and recommended that the Bank perform additional due diligence.

Mr. Rollag alleges that just one month after he first raised concerns about Belleville, he received a 2019 year-end performance review led by Defendant Lemone during which he was criticized for his purported firm treatment of junior employees and also his questioning of senior managers, which realistically could only refer to him reporting his concerns about Belleville to Defendant O’Reilly.

Furthermore, in February 2020 (after he expressed more concerns about Belleville and Malkin), Mr. Rollag learned that he would receive a bonus for 2019 that was $75,000 less than the one he received the previous year, even though Mr. Rollag had worked with the lucrative Cannabis team the vast majority of the year and had been promoted to Director at the beginning of 2019.

Beginning in March 2020, in conjunction with the alleged whistleblower retaliation, Mr. Rollag claims he was subjected to a campaign of abusive and retaliatory conduct by Defendant O’Reilly in response to his need to take a two-week paternity leave to which he was entitled after his wife was unexpectedly hospitalized due to pregnancy complications and gave birth about a month earlier than expected.

Less than two weeks after Mr. Rollag’s “leave,” Defendant O’Reilly’s hostile and aggressive conduct towards Mr. Rollag spilled into the open in an expletive-laden outburst during a team Zoom call, the lawsuit alleges. Soon, Mr. Rollag was excluded from working on new assignments and was even removed from an active deal that he had been working on, the lawsuit alleges.

On June 4, 2020, in the wake of the blatant retaliatory conduct and animus of Defendant O’Reilly and others, Cowen summarily terminated Mr. Rolag and told him that neither his performance nor his supposed treatment of junior employees played any part in the termination decision, the lawsuit alleges.

Mr. Rollag is represented by Wigdor LLP Founding Partner Douglas H. Wigdor and Partner Lawrence M. Pearson.

“As Mr. Rollag’s complaint lays out, management at Cowen disregarded financial and legal risks to their firm and client to pursue a quick deal with a reputed Russian oligarch,” Mr. Wigdor and Mr. Pearson said in a joint statement. “When Mr. Rollag spoke out about it, he quickly paid the price.  First in his pay and being sidelined, and then by being terminated. We will use all of our resources to ensure that Cowen is held responsible for this despicable behavior.”