Skip to main content

Getty Images/iStockphoto

A bitter dispute over the hiring of a junior employee has ended up in court, as two top-tier Bay Street investment firms battle each other over confidentiality and competition issues.

In May, Brandon Moyse, an analyst at distressed debt specialist Catalyst Capital Group Inc., quit to join West Face Capital Inc. Soon after, Catalyst sent a stern letter to West Face, initiating a months-long fight. In its suit against West Face and Mr. Moyse, Catalyst alleges that Mr. Moyse broke the terms of his non-compete clause, which states he can't work at a rival firm for six months.

It is rare to see a fight over a low-level employee. Typically, such cases arise when partners or managing directors change firms. However, Catalyst alleged that materials the analyst sent to his new firm during the interview process were "highly sensitive and confidential," and also worried that Mr. Moyse would disclose additional information on crucial files. Both Catalyst and West Face have business dealings with Canadian wireless companies Wind Mobile and Mobilicity.

In a letter responding to Catalyst's initial complaint, Mr. Moyse and West Face argued neither party did anything wrong. However, e-mails cited in court documents show that Mr. Moyse sent some examples of his work to West Face in March, along with his résumé, even though these memos were marked "confidential" and "for internal discussion purposes only."

At West Face, the partner who received them circulated the memos to other partners and a vice-president, "understanding that the information was confidential and of the concern associated with its disclosure," according to court documents.

Mr. Moyse's counsel argued in their submissions that Mr. Moyse's decision to send the memos was simply a "rookie mistake." The defendants also argued that the analysis in the memos wasn't confidential. "I multiply publicly available numbers by publicly available numbers. Like-minded people would have done the same thing," Mr. Moyse said in a cross-examination.

However, the analyst admitted during his deposition that he deleted the e-mail after sending it, and said that he did so because he realized some of the information was proprietary.

As the case developed over the summer, Catalyst's lawyers argued that Mr. Moyse had confidential documents such as a presentation Catalyst gave to some investment bankers about the concept and strategy of an investment.

On Nov. 10, Justice Thomas R. Lederer issued an interim judgment stating that sending confidential documents and possessing the additional Catalyst files is a serious issue – even though there was no proof that West Face had seen them.

The interim judgment prevents Mr. Moyse from starting work at West Face until Dec. 22 – six months after he left Catalyst. Until then, Catalyst must pay his West Face salary.

The judgment also authorizes a review of documents from Mr. Moyse's personal computer.

West Face will appeal the interim ruling. Lawyers for all three parties declined to comment.

Follow related authors and topics

Authors and topics you follow will be added to your personal news feed in Following.

Interact with The Globe