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New York jury awards $4.75 million in damages and punitive damages in a case where a firm hired a manager of another brokerage and allegedly encouraged the manager to secretly recruit salespeople as well as steal listings and other information from the brokerage before she left to work at the new firm.

A branch manager (“Manager”) who worked for a real estate brokerage (“Employer”) was allegedly recruited by a competing firm (“Competitor”). The Competitor had reportedly tried to recruit salespeople from the Employer at an earlier time. Allegedly, the Competitor asked the Manager to remain with the Employer for a period before moving to the Competitor so that she could recruit salespeople and also bring listings to the Competitor.

Eventually, the Manager and eleven of the Employer’s salespeople moved to the Competitor’s firm, with the Manager becoming a vice president at the new firm. The Manager allegedly copied other confidential information from the Employer prior to leaving the firm. The Manager also allegedly received a recruitment bonus from the Competitor.

The Employer filed a lawsuit against the Manager and the Competitor alleging that the Manager had a fiduciary duty to the Employer to recruit/maintain the firm’s relationship with its salespeople and she breached that duty when she recruited the salespeople to work for the Competitor. In addition, she allegedly breached her duty to her employer by stealing confidential information. The Manager also breached her duty by allegedly encouraging the salespeople to delay the execution of listing agreements so that the listings could be transferred to the Competitor.

The Manager claimed she had not received a raise in four years nor had she received a promotion, causing her to leave the firm. The Competitor denied the allegations as well. A jury considered the allegations.

The Supreme Court of New York, Ninth Judicial District, Westchester County, entered an award by the jury of $4.75 million in favor of the Employer. After a four-week trial, the jury determined the Employer had suffered damages of $2,250,000 and jury also awarded the Employer $2,500,000 in punitive damages. The Competitor has stated that it intends to appeal the jury verdict.

Douglas Elliman of Westchester, LLC, v. Thiess, No. 58059/2015, 2017 WL 3159223 (N.Y. Sup. Ct. Westchester Cty. June 20, 2017). [Note: This opinion was not published in an official reporter and therefore should not be cited as authority. Please consult counsel before relying on this opinion.]