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In the latest industry poaching lawsuit, Arthur J. Gallagher & Co. has filed suit against Alliant Insurance Services Inc. and other defendants, charging them with conspiring with its former employees to steal confidential information and trade secrets.
The lawsuit charges that, in a mass resignation coordinated by Newport Beach, California-based Alliant and the other defendants, more than 10 employees left Gallagher over a span of five days without notice and immediately began working for Alliant, leading to the departure of nearly 50 Gallagher customers as of last Wednesday, according to the lawsuit filed Friday in Arthur J. Gallagher & Co. vs. Don Tarantino et al. in U.S. District Court for the Northern District of California, which is based in San Francisco.
“This coordinated attack on Gallagher was planned over several months,” according to the complaint, and included stealing key customer data, active solicitation of Gallagher customers in the weeks leading up to the employees’ departure and efforts to “sabotage” Gallagher’s ability to keep its customers.
The complaint said Mr. Tarantino and another defendant, Michael Machette, had sold their insurance agencies to Gallagher several years ago and were both subject to post-termination restrictions on the solicitations of Gallagher customers and employees.
The ruling states Alliant’s conduct “is consistent with its national strategy of stealing business unlawfully from competitors, which often results in the imposition of injunctions and other negative rulings against it.”
The lawsuit cites previous litigation filed by Lockton Cos. Inc.
Alliant has also been a defendant in litigation filed by Aon PLC.
The complaint charges the defendants with breach of contract, trade secret misappropriation, breach of fiduciary duty, intentional interference with prospective economic advantage and with contractual relations, unfair business practices and unjust enrichment, among others.
A Gallagher spokeswoman had no comment.
Alliant said in a statement it “has experienced extraordinary growth over the last decade. Competitors have sought to suppress employee mobility through the excessive use of litigation. It is not uncommon in the insurance brokerage industry for lawsuits to be filed when employees depart for another firm -- Alliant’s competitors, including Gallagher, have been sued on many occasions. Gallagher is well aware that its post-employment non-compete covenants in agreements with California employees are unlawful and violate California’s fundamental public policy against restraints of trade."
The statement said also that Alliant “instructs prospective employees to act solely on behalf of their current employer until they resign.”
Lockton Cos. LLC has fired a barrage of litigation against Alliant Insurance Services Inc. for allegedly poaching 26 of its employees, including lawsuits filed in Delaware chancery court and state and federal courts in Missouri.