Investing.com -- B. Riley Financial Inc (NASDAQ:RILY). has leveled accusations against its former investment banking head, alleging he schemed to poach clients and personnel for his new employer, Texas Capital Bank. The accusations were made in a lawsuit filed in Dallas last week.
B. Riley alleges that David Merriman, who left the company abruptly before Thanksgiving, had been conspiring with Texas Capital prior to his resignation. The lawsuit states that Merriman's exit was part of a long-running scheme by Texas Capital Securities and himself to misappropriate B. Riley's trade secrets and confidential materials.
Representatives from Texas Capital Bank and Merriman were not immediately available for comment.
In the lawsuit filed last week, B. Riley asserts that Merriman and Texas Capital created a list of B. Riley investment bankers they intended to poach, prior to Merriman's departure. The firm claims that Merriman used his proprietary knowledge of B. Riley's operations to target the most revenue-generating employees.
The lawsuit also accuses Merriman of forwarding confidential data about current and potential business opportunities at B. Riley to his and his wife's personal email addresses. It alleges that he began blind copying his personal email on conversations with a B. Riley client over a month before his departure.
B. Riley's lawsuit states, "No sooner than his second day at Texas Capital Securities, Merriman hurriedly, directly, and brazenly began soliciting and attempting to induce a B. Riley investment banking client to divert its valuable business away from B. Riley and to Texas Capital Securities.”
The firm is seeking a court order to prevent Merriman and Texas Capital from using confidential information from B. Riley, and demands the return of all records to the firm.
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