Pharma firm's former treasury director denies embezzlement charges, files counterclaims

By Nicholas Malfitano | Sep 13, 2017

PHILADELPHIA – A pharmaceutical firm’s former treasury director has categorically denied claims she embezzled corporate funds to her E*Trade account, and filed counterclaims of breach of contract and conversion versus her former employer.

In May, Endo Pharmaceuticals, Inc. filed suit against Cindy Fryer in the U.S. District Court for the Eastern District of Pennsylvania. The litigation alleged Fryer defrauded the company out of 9,641 stock options worth more than $88,000, attempted to funnel just over $394,000 of Endo Pharmaceuticals corporate funds into her personal E*Trade account and misrepresented that she had not engaged in any illegal company activity in her Separation Agreement, entered into earlier this year.

As a result, the company sought monetary damages, punitive damages, court costs and any further relief the Court grants, in its initial complaint.

Through an answer to the complaint filed in July, Fryer actively denied Endo Pharmaceuticals’ allegations in full, believing the company failed to state a claim upon which relief could be granted, that she acted in good faith through all of her dealings with the company and that the company’s allegations are barred by the applicable statutes of limitation and other doctrines, among a number of other affirmative defenses.

Fryer further explained she received exemplary performance reviews and awards in her time with the company dating back to 2010, until the hiring of a senior vice-president and treasury official named Karen Wallace. Wallace became Fryer’s supervisor, and Fryer claims starting in 2015, she subsequently began receiving negative performance reviews and having her employment responsibilities taken away from her.

Despite reporting these circumstances to the company’s Human Resources Department, Fryer claims no action was taken, and she was later informed her position was being eliminated through cutbacks this past January.

According to her Separation Agreement, Fryer claims she was due to receive: Severance pay in the gross amount of $234,927; 2016 annual incentive compensation of $73,415; the cash portion of her revised 2016 retention award of $39,155; the company’s portion of medical, dental and vision insurance premiums for up to 10 months and the cost for up to six months of outplacement services, plus payment for any accrued and unused paid time off, regardless of whether Fryer signed the Separation Agreement or not.

However, Fryer believes Endo Pharmaceuticals did not deliver on its end of the Separation Agreement.

To that end, Fryer leveled a pair of counterclaims at Endo Pharmaceuticals, for breach of contract and implied covenant of good faith and fair dealing, and for conversion – for allegedly not paying her according to the terms of her Separation Agreement, which included an accusation of not compensating her for her accrued and unused paid time off.

Fryer seeks compensatory damages, consequential damages, punitive damages, attorney’s fees, costs of suit and all such other relief as the Court may deem just, in addition to a trial by jury. The case remains pending.

The plaintiff is represented by Michael D. Homans and Joanne K. Kernicky of Flaster Greenberg, in Philadelphia.

The defendant is represented by Michael J. Miles of Brown & Connery, also in Philadelphia.

U.S. District Court for the Eastern District of Pennsylvania case 2:17-cv-02245

From the Pennsylvania Record: Reach Courts Reporter Nicholas Malfitano at

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