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Motorola ex-CFO Paul Liska says fired for doubting forecasts

By Amarendra Bhushan for CEOWORLD Magazine Updated:April 10, 2009

Former chief financial officer (CFO) Paul Liska sued Motorola Inc. in county court in Chicago on Feb. 20, a day after he was fired. Schaumburg-based Motorola filed its own response to Liska’s lawsuit in late March.

Liska claims his dismissal was a “retaliatory discharge,” usually a reference to an employee fired for being a whistleblower.

In a response to the lawsuit posted on the Chicago Tribune’s Web site Thursday, Motorola says Liska planned a “scheme designed to portray himself as a whistleblower and demand millions in return for his silence.”

Motorola Inc., the telecommunications equipment maker has called one of its former executives “a treacherous officer” in court papers.

A Cook County Circuit Court judge on Thursday unsealed Paul Liska’s reply to Motorola’s response to his lawsuit claiming the company wrongfully discharged him from his post as chief financial officer.

Liska claims he was praised at his job and says Motorola is trying to destroy his reputation.

Liska’s allegation: Motorola “repeatedly misrepresented the financial performance of its Mobile Devices unit. Specifically, he began having concerns that Mobile Devices executives—including head Sanjay Jha—“was intentionally or recklessly, materially misstating its 2009 forecasts and strategic plan.” He claims forecasts were “based on inaccurate or unsupportable financial assumptions.”

Liska course of action: Liska apparently warned Motorola’s board of directors telling them that the “continual forecasting errors,” would have “a significant deleterious impact on Motorola’s credit ratings and relationships, particularly if Mobile Devices’ actual results continued to fall well short of its actual forecasts.”

Cook County officials would not release Motorola’s court filings to the AP.

Liska claims he was praised consistently for his work and has said Motorola was trying to “destroy his reputation in retaliation for raising legitimate concerns” about Motorola’s cell phone unit.

Liska did not receive his signing bonus, stock options or severance pay.

In February, North America’s largest maker of telecommunications equipment posted a massive fourth-quarter loss as it recorded charges to reflect the shrinking value of its cell phone business. It also suspended its dividend, said CFO Paul Liska had left and gave a disappointing forecast for the fiscal first quarter.

Faced with plunging cell phone revenue, the company had hatched a plan last year to spin off its Mobile Devices business, but persistent losses caused it to postpone that move.

When it reported fourth-quarter earnings back in February, Motorola gave no specific reason for Liska’s departure, but co-CEO Greg Brown implied that it was connected to the delay of the phone spin-off. He said at the time that changes in the “business environment” made a change at the CFO post appropriate as well.

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