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Defecting Employees Destroy Successful New Business

Posted by Frank Steinberg | Oct 28, 2009 | 0 Comments

Here's what happened to Charter Oak, a successful new mortgage business that didn't protect itself from its own employees.  Ten of them left as a group for a larger competitor, allegedly stole files and pending deals, and basically decimated the business.  Lacking non-compete, confidentiality, and non-solicitation agreements, Charter Oak lost in court.  The case is now on appeal.

It makes you think, doesn't it?  Doubtless caught up in the euphoria of establishing a new business, Charter Oak's principals failed to plan for the worst and are now paying dearly for the oversight.

We present many of our posts as life lessons on what can happen if you don't do things the right way.  Charter Oak's situation is about as graphic an example as we have found.

About the Author

Frank Steinberg

Frank is the founder and principal of Steinberg Law, LLC. A Jersey boy born and bred, he focuses on employment litigation and counseling, business litigation,  and aviation law. Following law school and a clerkship in the federal district court Frank spent his early career with large litigation ...

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