Staffing firm in Southern Tier alleges corporate espionage by former employees
Two Southern Tier staffing agencies are locked in a bitter dispute alleging corporate espionage, payroll sabotage, the breaching of non-compete and non-disclosure agreements and the hijacking of a company Facebook page.
In a 54-page filing with the Federal District Court in Northern District earlier this month, Adecco accuses the upstart Staffworks of raiding its Corning, Elmira, Utica and Syracuse staff to steal proprietary account information and using it to steal long-established business.
Named in the suit are seven former Adecco employees and the Staffworks founder, all of whom are accused of a concerted scheme to aid a competitor at Adecco's expense.
Adecco, one of the world's largest staffing firms, says it "has and will continue to suffer damages, irreparable harm" from the actions of the defendants and asks the court to prevent those named in the suit from working at Staffworks and for financial damages, the lawsuit states.
In an initial order, Albany-based U.S. District Court Judge Mae D'Agostino denied an injunction against defendants, ruling the key facts in the case are in dispute and cannot be judged without a hearing.
Two defendants claim say Adecco's allegations are baseless because they were let go in coronavirus cutbacks, while the others say they left the staffing agency when their wages were slashed at the same time they were asked to assume greater workloads
Lawyers for those named in the suit also claim the non-compete agreements are "overly broad" and unenforceable because they fail to meet strict New York guidelines.
Accusations that the group stole trade secrets for the benefit of Staffworks are defective, the defendants lawyers argued in court papers.
"Adecco’s claims of improper takings of 'trade secret' information is a red herring," said lawyers for the defendants.
"The customer lists and information they identify concern commonly known commercial enterprises in a limited geographical area."
Former employees try to discredit claims
The defendants include Staffworks, Inc. which is based in New Hartford, Oneida County; the company's President and Chief Executive Anita Vitullo and a group of former Addecco employees.
All, the Zurich, Switzerland-based Adecco claimed, signed non-compete and non-disclosure agreement as part of their employment agreements yet appropriated key account information from their former employer, the lawsuit claims.
Among the most serious charges in the Adecco suit against Staffworks:
Former Adecco employees commandeered a Adecco Corning office Facebook page for their own use, renaming it and taking control of posts.A former Adecco employee broke into locked office filing cabinets, drilling through locks, "to remove colleague personnel files and other Adecco documents containing confidential information." The employee contends she was only trying to obtain personal items from the locked cabinet.Proprietary pricing information and profit margin details was emailed from internal email account to personnel accounts before Adecco cut off access. Those named in the suit refused to return company laptops and mobile devices with critical and confidential client and company details.In their last weeks of employment , three defendants sabotaged client relationships by failing to enter information into a payroll system, later using the foul-up as evidence that Adecco was "going downhill," in an attempt to land new clients.
Using access to proprietary information, the lawsuit contends, Staffworks, which had previously had limited Elmira and Corning operations, expanded and won business from several long established Adecco customers.
Those included Corning Inc.; Boral Building Products; Elkland, Pennsylvania; Tessy Plastics, in Elbridge in Onondaga County; State Lin Auto Auction in Waverly, Tioga County, as well as other in Rochester Syracuse and Horseheads in Chemung County.
Preston Zarlock an attorney with Phillips Lyte of Buffalo, representing the defendants, including Staffworks, said he was not authorized by his client to address the case publicly.
Tyler Tarney, a Columbus, Ohio, attorney representing Adecco, said, "I'm not in a position to provide comment at this time."
Adecco claims 'extreme harm'
Unspecified monetary damages are demanded by Adecco in the lawsuit, along with enforcement of the non-compete and non-disclosure agreements, claiming the company "faces extreme, imminent, and irreparable harm."
Rather than a victim of a massive conspiracy, defendants contend Adecco is a casualty of their own business miscues.
"Adecco’s self-inflicted inability to provide customer service following a corporate reorganization, not any improper solicitation, is the cause of any loss of business," the defendants say in a 33-page response.
Some of the workers were let go from Adecco in mid May in COVID-related cutbacks, the court papers said, while others left the company in June to join Staffworks.
Following their departure, the remaining employees said the "the work atmosphere at Adecco was chaotic," the response states.
Lawyers for the defendants quarrel with the notion that the group of former Adecco employees stole trade secrets.
"Adecco did not use any unique or unusual methods to find clients or provide specialized training," the response says. "To the contrary, staffing companies build their client base through hard work and customer service, not secret lists."
This article originally appeared on New York State Team: Staffing firm in Southern Tier alleges corporate espionage by former employees