Eastdil Secured Takes Legal Action Against Former Employees
Eastdil Secured has initiated legal proceedings against a group of six ex-employees who left the firm in March to join rival brokerage Newmark. The lawsuit, filed in the Superior Court of Orange County, accuses the former employees of stealing confidential and proprietary information, allegedly in violation of their confidentiality agreements.
Details of the Lawsuit
On Monday, Eastdil secured the lawsuit against former employees Geoff Boler, Eugene Chong, Blake Matsuda, Jonathan Merhaut, Lee Redmond, and Justin Shepherd, who were part of the company’s multifamily team based in Newport Beach and Santa Monica. The firm claims that these individuals departed for Newmark almost immediately after resigning, taking sensitive documents related to ongoing and prospective business deals with them.
Allegations Made by Eastdil
The complaint outlines several serious allegations, including:
- Breach of contract
- Breach of fiduciary and loyalty duties
- Misappropriation of trade secrets
- Tortious interference with contracts and business relationships
- Engagement in unfair competition
Eastdil claims the ex-employees not only took important documents but also deleted or improperly saved various emails and files from company systems, potentially disrupting the firm’s ongoing projects.
Immediate Actions Requested
As part of the lawsuit, Eastdil is requesting a temporary restraining order and a preliminary injunction, which would restrict the defendants from utilizing the misappropriated information while the arbitration process is pending. Additionally, the firm is demanding that all documents, records, and confidential information be returned within 24 hours of a court order.
Impact on Business Relationships
The court documents highlight that the stolen materials could facilitate the former employees’ efforts to solicit Eastdil’s clients and replicate documents for future transactions at Newmark. Notably, one specific case mentioned in the lawsuit involves a client who allegedly canceled their listing agreement with Eastdil and switched to the former employees now working at Newmark.
Background on the Former Employees
Newmark publicly announced the hiring of Boler and his colleagues on March 5. Boler is set to fulfill the role of executive vice chairman, while Merhaut and Redmond will serve as vice chairmen, and Chong as senior managing director within Newmark’s Orange County office. Collectively, this team boasts an impressive track record, having closed over $100 billion in deals and accounted for more than 90 percent of multifamily sales in the Western United States over the past seven years.
Chad Lavender, Newmark’s president of capital markets for North America, commented on their recruitment, stating, “These individuals bring an incredible level of professionalism, esteem and accomplishment to our company.”
Reactions
Representatives from both Eastdil and Newmark have opted not to comment on the ongoing lawsuit. The implications of this legal battle could be significant for both firms, potentially reshaping the competitive landscape in the multifamily real estate market.
For further inquiries, Nick Trombola can be reached at nt*******@co****************.com.
