Brokerage

Lawsuit Alleges Theft of Confidential Information

Three executives are accused of taking proprietary information with them when they joined a rival firm.
By: | November 3, 2014 • 2 min read

Arthur J. Gallagher & Co. (AJG) has accused three former executives of stealing trade secrets and proprietary information on marine services clients before leaving their jobs to work for a competitor, Howden Insurance Services, according to a lawsuit filed in the U.S. District Court for the Eastern District of New York.

AJG claims two of the former employees, Christopher Maro, formerly a senior vice president in the brokerage’s Garden City, N.Y. office, and Kenneth Fichtelman, an account executive in that office, connected USB flash drives to their AJG computers before resigning on July 18, 2014 and Aug. 4, 2014, respectively.

Hyperion Insurance Group Ltd., parent of Howden, denied the allegations: “We take these allegations extremely seriously and will defend all allegations made in the litigation to the fullest extent possible.”

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First to resign, on June 3, 2014, and begin working for Howden was John Betz, formerly area president of AJG’s marine group, according to court documents. Betz had been with AJG since it acquired his agency, B&P International Insurance Brokerage, in March 2004 for about $8 million.

All three of the men had employment agreements with AJG that forbade them from divulging confidential information or soliciting or consulting with any of their clients from AJG for two years after leaving the company.

Nonetheless, all of the men “worked in concert to solicit and move AJG’s marine insurance business to Howden,” even prior to their resignations, according to the lawsuit.

“This lost business accounted for approximately $2.7 million in revenue during 2013, and it was anticipated that this business would generate $2.7 million in revenue in 2014 as well. Instead, the marine insurance group that Betz, Maro, and Fichtelman left behind now anticipates a loss of $700,000 in 2014.”

The lawsuit noted that the “particular needs of AJG’s current and potential customers of marine insurance are not well-known to the public and constitute highly valuable confidential and proprietary information belonging to AJG.”

The lawsuit also accuses Betz and Maro of meeting with a Howden consultant, Paul Bedford, on a Colorado ski trip in the winter of 2014 that was organized by Betz and was supposed to be for AJG clients.

Anne Freedman is managing editor of Risk & Insurance. She can be reached at [email protected]

More from Risk & Insurance

More from Risk & Insurance

4 Companies That Rocked It by Treating Injured Workers as Equals; Not Adversaries

The 2018 Teddy Award winners built their programs around people, not claims, and offer proof that a worker-centric approach is a smarter way to operate.
By: | October 30, 2018 • 3 min read

Across the workers’ compensation industry, the concept of a worker advocacy model has been around for a while, but has only seen notable adoption in recent years.

Even among those not adopting a formal advocacy approach, mindsets are shifting. Formerly claims-centric programs are becoming worker-centric and it’s a win all around: better outcomes; greater productivity; safer, healthier employees and a stronger bottom line.

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That’s what you’ll see in this month’s issue of Risk & Insurance® when you read the profiles of the four recipients of the 2018 Theodore Roosevelt Workers’ Compensation and Disability Management Award, sponsored by PMA Companies. These four programs put workers front and center in everything they do.

“We were focused on building up a program with an eye on our partner experience. Cost was at the bottom of the list. Doing a better job by our partners was at the top,” said Steve Legg, director of risk management for Starbucks.

Starbucks put claims reporting in the hands of its partners, an exemplary act of trust. The coffee company also put itself in workers’ shoes to identify and remove points of friction.

That led to a call center run by Starbucks’ TPA and a dedicated telephonic case management team so that partners can speak to a live person without the frustration of ‘phone tag’ and unanswered questions.

“We were focused on building up a program with an eye on our partner experience. Cost was at the bottom of the list. Doing a better job by our partners was at the top.” — Steve Legg, director of risk management, Starbucks

Starbucks also implemented direct deposit for lost-time pay, eliminating stressful wait times for injured partners, and allowing them to focus on healing.

For Starbucks, as for all of the 2018 Teddy Award winners, the approach is netting measurable results. With higher partner satisfaction, it has seen a 50 percent decrease in litigation.

Teddy winner Main Line Health (MLH) adopted worker advocacy in a way that goes far beyond claims.

Employees who identify and report safety hazards can take credit for their actions by sending out a formal “Employee Safety Message” to nearly 11,000 mailboxes across the organization.

“The recognition is pretty cool,” said Steve Besack, system director, claims management and workers’ compensation for the health system.

MLH also takes a non-adversarial approach to workers with repeat injuries, seeing them as a resource for identifying areas of improvement.

“When you look at ‘repeat offenders’ in an unconventional way, they’re a great asset to the program, not a liability,” said Mike Miller, manager, workers’ compensation and employee safety for MLH.

Teddy winner Monmouth County, N.J. utilizes high-tech motion capture technology to reduce the chance of placing new hires in jobs that are likely to hurt them.

Monmouth County also adopted numerous wellness initiatives that help workers manage their weight and improve their wellbeing overall.

“You should see the looks on their faces when their cholesterol is down, they’ve lost weight and their blood sugar is better. We’ve had people lose 30 and 40 pounds,” said William McGuane, the county’s manager of benefits and workers’ compensation.

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Do these sound like minor program elements? The math says otherwise: Claims severity has plunged from $5.5 million in 2009 to $1.3 million in 2017.

At the University of Pennsylvania, putting workers first means getting out from behind the desk and finding out what each one of them is tasked with, day in, day out — and looking for ways to make each of those tasks safer.

Regular observations across the sprawling campus have resulted in a phenomenal number of process and equipment changes that seem simple on their own, but in combination have created a substantially safer, healthier campus and improved employee morale.

UPenn’s workers’ comp costs, in the seven-digit figures in 2009, have been virtually cut in half.

Risk & Insurance® is proud to honor the work of these four organizations. We hope their stories inspire other organizations to be true partners with the employees they depend on. &

Michelle Kerr is associate editor of Risk & Insurance. She can be reached at [email protected]