(Bloomberg) -- An activist investor in Cedar Realty Trust Inc. is calling for an investigation of sexual harassment claims in a lawsuit filed against the company’s chief executive, Bruce Schanzer, and said any evidence uncovered to back up the allegations should result in his immediate suspension or firing.
Snow Park Capital Partners criticized the Port Washington, New York-based company for failing to respond swiftly or strongly to the suit by Nancy Mozzachio, Cedar Realty’s former chief operating officer, in a Nov. 9 letter obtained by Bloomberg News, saying the initial statement “utterly fails to appreciate the severity of the allegations.”
"What is very relevant to us is whether there was a pattern of sexual harassment and multiple women that had complained to Bruce in the past," Jeff Pierce, New York-based Snow Park’s managing director said in an interview. "The other question I want an answer to -- and I want it to come from the board, not management -- is whether Cedar funds were used to settle such claims."
Mozzachio claimed in her suit, filed Nov. 2, that the chief executive officer “regularly leered” at women working for the firm and spoke inappropriately, calling her “babe ” and making other comments. Mozzachio alleged she was also harassed by the company’s chairman, Roger Widmann, and faced retaliation after voicing her concerns to a lawyer. Snow Park also called for Widmann’s actions to be reviewed.
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Cedar Realty’s independent board members said in a statement that Snow Park’s comments were “misinformed and factually inaccurate” and based on “discredited allegations made two years ago by a former company employee following her termination for cause.” A law firm already investigated her earlier claims and determined they were “false and without merit,” they said.
“The board remains fully supportive of the Cedar management team,” according to the statement, which notes that the company will cover appropriate legal costs based on indemnity obligations.
Snow Park also called for a review to find out if company money was paid out for sexual harassment claims against Schanzer, saying that should have been disclosed to investors. Should the investigation lead to Schanzer’s termination, Cedar Realty should claw back any compensation he earned during the period in question, according to the letter.
“Mr. Schanzer’s alleged willful misconduct, if confirmed, will result in serious and possibly irreversible harm to Cedar’s reputation,” Snow Park said.
Snow Park Capital disclosed a 3.5 percent stake in Cedar Realty last month and is pushing for changes at the company, including a potential sale. Cedar Realty invests primarily in supermarket-anchored shopping centers in the northeastern U.S.
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