U.S. Attorney Andrew Luger has moved two lawsuits against Starkey Laboratories to federal court after a Hennepin County District Court judge denied his motion to stay discovery in the cases.
The order was filed Monday night, hours after Judge Kevin Burke angrily said he was going to rule in favor of Luger's motion but changed his mind after Assistant U.S. Attorney Erin Secord said her office was going to seek to move the case to federal court. He said the argument was a surprise and the office wasted his court's time.
The cases are wrongful termination suits filed against Starkey by Keith Guggenberger, fired chief operations officer, and fired executive assistant Julie Miller.
The U.S. attorney's office argued that discovery in these cases would interfere with a federal investigation into wrongdoing by several fired Starkey employees, including Jerry Ruzicka, the former president of the Eden Prairie hearing aid manufacturer and distributor.
The cases have been assigned to U.S. District Court Judge David S. Doty.
Ruzicka, Guggenberger, and Miller were all abruptly fired from Starkey in September along with several other high-level employees. Since then, the Federal Bureau of Investigation and Internal Revenue Service have searched Ruzicka's home and interviewed several current and former employees. Allegations also have been thrown out by the fired employees, Starkey owner Bill Austin and Brandon Sawalich, Austin's stepson and a company vice president.
In court filings both sides have accused the other of stealing or misusing funds from the company. Ruzicka's case is currently being handled by a mediator. In that case, both Ruzicka and Starkey agreed to halt his civil court lawsuit pending the outcome of the mediation process.
No indictments have been handed down to date. During Monday's hearing and in recent court documents, Secord and attorneys representing Starkey, Austin and Sawalich have referred to a grand jury investigation, but declined to elaborate.