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Ellerbe Sues after Five Principals Jump to Rival HOK

Ellerbe Becket says the defection of five key principals from its Kansas City sports architecture office to rival HOK violated agreements the company had with its staff and with HOK, according to a lawsuit filed last week in state court.

Based in Minneapolis, Ellerbe Becket maintains a sports design office in Kansas City, as do HOK and other firms. Defections have been common over the years, but none ever involved five principals. The two firms are working as members of a team designing a new arena in Kansas City, and that fact is crucial to the dispute.

The lawsuit asks a judge in Kansas City to impose damages and issue a court order stopping the five defectors from using confidential information or interfering with Ellerbe’s clients and employees. It charges the five with breach of contract, interference with a contract and breach of fiduciary responsibility.

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According to the lawsuit, all five signed fair dealing agreements on accepting employment. The agreements say that the employee will not solicit clients or other Ellerbe employees if they are terminated, the lawsuit claims.

A handshake agreement made over the arena project also prohibited solicitation, Ellerbe claims.

HOK officials could not be reached for comment. Michael Katz, an attorney for Ellerbe, declined to comment while the matter was still in court.

According to the lawsuit, St. Louis-based HOK first secretly negotiated with David J. Orlowski, the head of Ellerbe Becket’s Kansas City office and chief of sports architecture. The other employees involved, Brad A. Clark, Michael R. Clay, Stephen F. Hotujac, and Michael W. Sabatini, were recruited shortly afterward, the lawsuit claims.

Last October, Ellerbe and HOK started work on the new Kansas City arena project, a collaboration that put the two staffs in close contact, claims Ellerbe. The two firms and “other firms involved in the project agreed that each firm would not employ or solicit to employ any employees from the other firms working on the project, says the lawsuit. Nothing was put into writing, however, and the lawsuit suggests the agreement was sealed with a handshake.

Another section of the lawsuit says Ellerbe’s staff was bound by terms of its employment agreements. Under the terms of their fair dealing pacts, Ellerbe’s employees must refrain from contacting existing and prospective Ellerbe clients and from contacting another Ellerbe employee about leaving the staff, the lawsuit says.

After secretly negotiating with Orlowski, HOK’s “raid” grew to include Clark, Clay Hotujac and Sabatini, the only other principals in Ellerbe’s Kansas City office and leaders of the sports practice, claims Ellerbe. Clark, Clay, Hotujac and Sabatini were principally involved in marketing, maintaining client relationships and management. Prior to March 3, they stopped pursuing new work for Ellerbe, the firm charges. An additional Ellerbe Becket employee was also persuaded to join HOK.

After the web site of a trade publication reported the defections, competitors, clients and the public became aware of the defections and “the full extent of future losses is impossible to measure at the present time,” claims Ellerbe.

Richard Korman, for enr.com

 

 

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