Breaking bonds

A personnel-poaching case that has rocked the City has cleared its first hurdle, with Mr Justice Jack ruling that broker Tullett Prebon was the victim of a conspiracy when arch rival BGC Brokers poached 10 of its brokers.

Rosenblatt Solicitors partner Clive Hyer jointly instructed One Essex Court’s Jeffrey Onions and 11KBW’s Dan Oudkerk in March 2009 to bring a ‘no poach’ injunction against BGC on behalf of Tullett. This effectively prevented the defendants from hiring any Tullett staff, whether they would be in breach of contract or not.

The row erupted after Tullett alleged that BGC offered millions in up-front payments as part of a poaching raid. This involved Tony Verrier, Tullett’s former chief operating officer, who last year joined BGC as managing director for Europe.

Specifically, it was claimed that the there was a conspiracy between BGC, Verrier and BGC president Shaun Lynn to induce 10 Tullett brokers to walk out of Tullett on grounds of constructive dismissal.

It emerged during the trial that BGC had gone to extreme lengths to recruit Tullett staff. Oudkerk told the court that “many thousands of [incriminating] text messages” had disappeared as a number of those alleged to be BGC’s “recruiting sergeants” had lost their mobile phones or BlackBerrys.

In his ruling Jack J stated flatly: “I’m satisfied that it was Mr Verrier’s gambit to ‘lose’ BlackBerrys whenever he thought they might contain inconvenient material, and that his instructions were the cause of at least some of the mobiles being lost.

“I’m satisfied that the inaccessibility of the contents of his last BlackBerry due to a missing password was a deliberate ploy.”

Furthermore, he added: “I found that in his evidence Mr Verrier stuck to the truth where he was able to, but departed from it with equanimity and adroitness where the truth was inconvenient.”

It is a damning conclusion and one that will no doubt be reflected when damages are assessed and remedy costs established.

The 10 brokers, who were also defendants in the case and have not been able to work since they were inducted last March, have been told they must pay back signing and bonus payments given to them by Tullett.

Oudkerk said team poaching cases were becoming increasingly common.

“When Lehman collapsed there were rightly concerns about redundancies across the City,” he said. “People thought team poaching cases would go away, but it hasn’t turned out that way.”

Employment lawyers say that while this case has not created new law, it is a warning to firms and companies about the tactics used when recruiting teams.

“It is never easy to recruit a whole team without breaking any rules of employment,” one lawyer says. “The judgment shows that judges are unafraid of being extremely critical of anyone who has breached the terms of contact.”

Recruiting a team, whether they be lawyers or not, is never an easy game to play and it can all go disastrously wrong, as this case highlights.


Tullett Prebon: Rosenblatt partner Clive Hyer instructed One Essex Court’s Jeffery Onions QC, 11KBW’s Daniel Oudkerk (now QC) and Amy Rogers


BGC Brokers, BGC Brokers GP Ltd and Shaun Lynn: McDermott Will & Emery instructed Essex Court Chambers’ Andrew Hochhauser QC and Littleton Chambers’ Jonathan Cohen

Anthony Verrier: Russell Jones & Walker instructed Littleton Chambers’ Stuart Ritchie and Christopher Newman

James Hall and others: Berwin Leighton Paisner instructed Littleton Chambers’ Selwyn Bloch QC and Jeremy Lewis