A 24-carrot legal brawl is unfolding in the New York courts over LVMH-owned luxury jeweler Tiffany & Co. poaching a former Cartier executive.
One claim is that she has insider intelligence on Cartier’s high-end gem collection including a pricey Colombian emerald necklace.
Our industry’s version of the luxury brand spat is the legal face-off between Keller Williams and eXp Realty over eXp’s attempt to recruit the beloved former KW CEO Mark Willis.
A Texas judge has granted a temporary restraining order that prevents Willis from joining eXp in an undisclosed executive position. Keller Williams claims in legal filings that Willis has too much proprietary information as an owner of a Keller Williams Market center.
With Keller, Willis ran KW for 10 years from 2005 to 2015 during its biggest period of growth, from 38,000 to 140,000 agents.
In this recent legal squabble, the conflict is very personal.
Word is that KW founder Gary Keller went cuckoo upon hearing about Willis, who left the company seven years ago.
EXp founder Glenn Sanford is vindictive to this day about Keller snubbing him many years ago. He excluded Sanford from an insider club of high-performance agents back when he was a top-producing KW agent.
Sanford hiring Willis was a stab to the heart of Keller.
Like many executives who have left KW in the past 10 years, the Austin-based C-suite is full of drama, sparked by the personalization of business decisions by mercurial Keller.
But the stakes are higher than a schoolyard rumble.
An industry icon with a cult-like following, the 65-year old native Texan has had five CEOs/Presidents in the past seven years. He has never found the kind of executive stability that he enjoyed with Willis.
Like a scene out of the old TV show Dynasty, Willis’s exit was purportedly in part engineered by a former executive, Mary Tenant. She was another character in the KW world, who saw an opportunity for her nephew, John Davis, if Willis was gone. Davis later became president, but he too was booted in another high-octane departure.
The timing of recent events could not be worse for Keller Williams.
Out of nowhere, eXp has become the fastest-growing real estate company, just as KW prepares for an IPO. The virtual brokerage’s success has come at the expense of Keller Williams and other top brands.
Is this sort of case unusual? No, recruiting lawsuits are common.
The last big real estate industry recruiting scrap happened eight years ago when Zillow recruited Realtor.com executive Errol Samuelson.
Realtor.com’s new owner at the time, media mogul Rupert Murdoch’s News Corp., authorized a massive lawsuit, alleging the theft of intellectual property, among other claims.
Zillow bowed and paid a staggering $200 million to settle the claims brought by News Corp.
Samuelson is still an exec at Zillow.
The KW-eXp legal wrangling is different because Willis has not worked there for seven years.
Nevertheless, last week a Texas judge upheld and extended the temporary restraining order he granted earlier this year until April, as both sides bolster their legal arguments for a final resolution.
Even sooner, the Judge will likely push the case into mediation, I hear. My guess is Mark Willis will be the eXp CEO by St. Patrick’s Day.
The lesson in all of this messiness: be careful who you poach — or be willing to face the consequences.