V
anguard Properties is pushing back against claims made by Red Oak Realty in a lawsuit alleging the San Francisco-based independent brokerage poached East Bay agents using non-disclosure agreement-protected information from failed merger talks. Vanguard filed a motion to dismiss the complaint in San Francisco Superior Court, or alternatively, asked that if the litigation proceeds, the court strike portions of the complaint and deny Red Oak's request for a preliminary injunction.

    Red Oak's original suit alleged Vanguard engaged in an agent "poaching campaign" using protected information gleaned from failed merger talks. However, Vanguard's motion to strike refers to Red Oak as a "failing East Bay real estate brokerage that has apparently concluded it can stem the tide of departing agents by filing a meritless lawsuit against Vanguard."

    Vanguard argues that Red Oak is trying to tarnish its reputation and disrupt lawful competition amongst competitors rather than addressing internal problems that led to agent departures. The motion also claims that previous California court rulings support employees' ability to move freely between companies, stating "it is black letter law in California that soliciting another company's agents (or employees) is not unlawful."

    Red Oak CEO Vanessa Bergmark maintains she has proof of her accusations and that the suit was not about the four agents who left for Vanguard but rather putting an end to what she sees as "dirty practices" after the merger did not pan out. However, Vanguard's motions were bolstered by extensive documentation and declarations from former Red Oak agents and Vanguard executives.

    The supporting documents include declarations from four former Red Oak agents stating they initiated contact with Vanguard due to dissatisfaction with their previous brokerage, including poor management, outdated marketing strategies, and unprofessional workplace conduct. They deny that Vanguard used information on commission splits, agency fees, compensation, or marketing gained from the merger talks to recruit them.

    Vanguard's CEO James Nunemacher stated in his declaration that the initial acquisition talks began in 2020 but quickly fizzled, and the parties signed a non-disclosure agreement in January 2023. However, he denied ever using the information covered by the NDA for any reason except to evaluate the potential merger.

    A hearing on the motions to dismiss the case or strike portions of the complaint has been set for February 3, with Red Oak CEO Vanessa Bergmark stating there will be more documents filed on her end, indicating a "round three" in the litigation.