Eastdil Sues Former Brokers, Claiming They Stole Deals, Docs When They Left For Newmark

Eastdil Secured is going after six of its recently departed brokers in court, claiming that they looted the brokerage’s trade secrets and ran off with their business.

The brokers, who were part of Eastdil’s West Coast multifamily team, moved to Newmark last month. 

Eastdil claims they breached their contracts and stole thousands of pages of documents containing proprietary information, including on active deals, according to a complaint filed in California Superior Court in Orange County.

The brokerage has also applied for a temporary restraining order to prevent distribution of any information that the brokers allegedly took with them. The lawsuit was first reported by The Real Deal.

Eastdil declined to comment. The defendants’ counsel did not immediately respond to Bisnow’s request for comment. Newmark is not named as a defendant in the lawsuit, and a representative also didn't immediately respond to requests for comment.

The two firms are fierce competitors — Newmark co-Heads of U.S. Capital Markets Doug Harmon and Adam Spies are both alumni of Eastdil’s shop, although they left the firm for Cushman & Wakefield in 2016 before being hired by Newmark CEO Barry Gosin in 2023.

The brokers named in the lawsuit are Geoff Boler, Eugene Chong, Blake Matsuda, Jonathan Merhaut, Lee Redmond and Justin Shepherd. Many of them had substantial tenure at Eastdil and were making more than $1M a year when they left, according to the complaint. 

The brokers notified Eastdil of the resignations March 3 but allegedly failed to respect their obligated notice period, instead immediately jumping ship to Newmark. The lawsuit notes that Chong didn't provide any written notice nor meet with anyone at the company, opting to leave a voicemail March 4 where he stated that he, too, would be leaving, according to the suit.

Newmark announced on March 5 that it hired the team, naming Boler executive vice chairman, Merhaut and Redmond vice chairmen and Chong senior managing director.

Prior to their resignations, the brokers packed up several confidential and proprietary documents, Eastdil alleges. 

In some cases, information was emailed to their personal email addresses. Boler is accused of sending nine separate “cheat sheets,” which summarize key deals, to himself Feb. 12. Those sheets are for internal use and are not meant to be circulated to clients, potential buyers, lenders, investors or anyone else outside the company, the brokerage asserts in filings.

In one deal, Eastdil alleges a client canceled its listing agreement and followed Boler to Newmark to bring the deal to the market, according to the complaint.

Boler is also accused of printing a log of all active and pending deals that Eastdil is working on. That’s more than 150 deals, many of which Boler was not directly involved in, per the lawsuit.

“The pipeline also includes the property/client name, applicable dates, and pricing information for the deals,” the complaint said. “Such information is highly confidential and competitively sensitive, and would be extremely valuable to a competitor, such as Newmark.”

Redmond is similarly accused of printing a log with five years’ worth of pipeline data along with a deal that Eastdil is currently in the bidding phase for. The complaint notes that the document was printed on Sunday, March 2, the day before he provided his notice of resignation.

In a declaration, Eastdil Chief Technology Officer Sean Neal wrote that the company’s records show that on March 3, Chong was copying and downloading entire folders relating to active deals, then saving the files to a location on Eastdil’s server where they would not normally be saved. From that location, he was able to share the folder with others outside the firm. An invite was sent to one external email address and that user downloaded more than 550 files, Neal claims.

Chong left his resignation voicemail the next day. 

Matsuda is similarly accused of downloading sensitive deal information in the same way as well as sending numerous files to a client on the same day he resigned. A week later, that client canceled its listing agreement with Eastdil and hired Newmark. The competitor went to market with the deal a day later. One of the cheat sheets Boler emailed to himself was for that deal, according to the complaint.

“It is virtually impossible to be able to bring a deal to market that quickly from scratch, and, on information and belief, Newmark and the Defendants would have been unable to do so without using the underwriting materials that were done at Eastdil and that were sent to the client by Matsuda on the day he resigned from Eastdil,” the complaint said.

New York-based Newmark has been unapologetic in its quest to recruit top producers, taking on debt to shell out pricey hiring packages. It is also going through some upheaval in its top ranks. Its controlling shareholder, Howard Lutnick, resigned as chairman and vowed to divest his interest after being confirmed as Secretary of Commerce under President Donald Trump.

Kyle Lutnick, Howard Lutnick's 28-year-old son, was named to Newmark's board of directors in February, while Gosin and Chief Legal Officer Stephen Merkel were elevated to chairman positions. 

Eastdil, run by CEO Roy March and backed by Temasek, Guggenheim Investments and Wells Fargo, hired BDT & MSD Partners last month to explore strategic partnerships, Bloomberg reported.