Corporations Keyed to Hamilton
Gibbs v. Breed, Abbot & Morgan
Between January and July of 1991, Plaintiffs were the only partners in Defendant’s Trusts and Estates Department. The department also consisted of three associates and support staff. In June, Plaintiffs informed Defendant’s president that they had accepted offers to join Chadbourne. Days later, Plaintiffs sent Chadbourne a memo detailing the names of staff in the Trusts and Estate Department and corresponding personnel information such as salaries, billable hours, and bonus structures. The memo was prepared in April in anticipation of discussions with prospective firms. Plaintiffs testified that the recruitment of certain personnel was discussed with different firms between March and May. While plaintiffs were still working at Defendant law firm, Chadbourne interviewed several members of Defendant’s staff. When Plaintiffs left Defendant law firm, they took with them their chronologies. In the following weeks, Chadbourne made employment offers to Defendant’s staff, all of whom accepted. Plaintiffs also used their chronologies to solicit Defendant’s clients. 92 of the 201 Trusts and Estate clients transferred their business to Chadbourne. Plaintiffs then brought suit to recover monies due to them under their employment contract with Defendant. Defendant alleged Plaintiffs breached their fiduciary duty to Defendant. The trial court held that the way in which the leave was orchestrated was done with the intention to cripple Defendant’s Trusts and Estates department, specifically, 1) Plaintiffs breached their fiduciary duty by supplying confidential employment information to Chadbourne while still partners at Defendant law firm; 2) Plaintiffs breached their fiduciary duties by taking their chronologies with them; 3) Gibbs breached his fiduciary duty by persuading Sheehan to leave with him.
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