N.D. Ga.

Mortgage Company Alleges that Recruiting Firm Used Trade Secrets to Poach 100 Employees

PrimeLending, a PlainsCapital Company v. Cavu Partners, LLC and Gary Sindall, Civil Action 1:22-cv-04200-AT (N.D. Ga., Oct. 21, 2022)

More than a decade ago, PrimeLending entered into a business relationship with Cavu Partners, an executive search firm, for recruiting services. Cavu Founding Partner Gary Sindall served as PrimeLending’s primary contact for the 11-plus year relationship. During the relationship, the plaintiffs say the defendants had access to a wide range of proprietary company information, including loan origination volume, employee compensation and staffing.

The recruiting agreement ended in 2020, but Cavu and Sindall continued to work with PrimeLending on a regular basis. That is, until Sept. 1, 2022, when 100 PrimeLending employees left the company for similar jobs at a competing mortgage lender.

PrimeLending claims that the defendants recruited these employees on behalf of the competing company, using trade secrets and other proprietary information acquired during their long relationship with the plaintiffs. “Mr. Sindall was also being paid by PrimeLending as a recruiter while actively working against PrimeLending’s interests to enrich himself and Cavu,” they write in their complaint.

The plaintiff estimates they will lose approximately $30 million in revenue in the next 12 months as the result of the defections. They are suing Cavu and Sindall for misappropriation of trade secrets, as well as breach of contract and breach of fiduciary duty.

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