Stearns Lending Inc. potentially avoided millions of dollars in losses with its recent victory in a lawsuit it faced from a competitor.
The complaint was originally filed during 2012 by Prospect Mortgage LLC in a state court located in Santa Ana, Calif.
The complaint alleged that Stearns Lending committed an act of unfair competition and economic interference when it recruited 17 Prospect Mortgage employees.
In addition to Stearns Lending, Sherman Oaks, Calif.-based Prospect Mortgage named former employees as defendants, according to an announcement from Stearns’ law firm, Carothers DiSante & Freudenberger LLP. The employees were included as defendants because they were allegedly in violation of a non-solicitation agreement.
The statement indicated that the trial lasted five weeks. Nearly two dozen witnesses were called to testify, and more than 400 exhibits were presented.
Following less than four hours of deliberation, the jury reached a verdict in favor of Santa Ana, Calif.–based Stearns Lending.
The outcome saved Stearns Lending “from potentially having to pay millions of dollars in damages,” the news release stated.
“It is just unfortunate that so much time and expense had to be expended on a case that clearly had no factual support or legal merit,” Stearns Lending Chief Executive Officer Brian Hale said in the announcement.
Carothers DiSante & Freudenberger Partner Todd Wulffson noted in the announcement, “California has tried hard to limit these types of lawsuits, which can be a large resource drain for businesses and harm employees because they serve as an impediment to hiring.”
