When a loan officer and an entire branch were recruited by one mortgage broker from a competing broker, a federal lawsuit ensued.
After National Fidelity Mortgage recruited Matthew Prizzi and John Itri from Precision Funding Group LLC, a lawsuit was filed by Precision in New Jersey naming National Fidelity as the defendant.
The two employees previously signed employment agreements with Precision that included a non-compete clause and a non-solicit clause lasting two years after termination.
The agreements also prohibited recruiting of Precision employees for one year and specified that all leads and loans were the property of the company after termination.
But Precision claims that Itri, a loan originator at the corporate office, solicited its employees to join him when he left.
Prizzi was a branch manager, and his entire branch joined National Fidelity. Precision alleges the branch directed existing clients to the new organization by, among other things, printing misleading flyers and telling customers that Precision was no longer in business.
The former employees, including those recruited by Itri, were bound by an arbitration clause to settle disputes through “arbitrator in Cherry Hill, New Jersey, administered by and in accordance with the then existing rules of practice and procedure of the National Arbitration Forum.”
The latest activity in the lawsuit was a May 31 ruling granting National Fidelity’s motion to compel arbitration.
