Law Times

PAGE 4 NEWS July 27/August 3, 2009 • lAw times ZSA suing former vice president BY ROBERT TODD Law Times claiming its former vice presi- dent breached an employment contract after leaving to work for a competitor. Th e company's statement of claim includes allegations that Carolyn Berger — who now works for legal recruitment fi rm Marsden International Ltd. — violated contractual and fi duciary duties by, among other things, "soliciting ZSA's clients" in Toronto, purging her work e-mail before leaving, and taking confi dential phone N ational legal recruit- ment company ZSA has fi led a lawsuit account information. Marsden is also named as a defendant. ZSA is seeking $750,000 from each of Berger and Mars- den International. Berger and Marsden Inter- national deny the allegations, and have fi led a statement of defence and counterclaim. Berger alleges that ZSA has not paid her for work she did before leaving, and owes her funds through its yearly share- holder distribution. None of the allegations from either side have been proven in court. "It's impossible to know how the courts will fi nd in any matter, but I'm prepared to test it," ZSA president Christopher Sweeney tells Law Times. "I feel very strongly that a contract is a contract." Berger and Marsden's law- yer, Ricketts Harris LLP part- ner Gary Luftspring, says Berger will not comment on the lawsuit. "It's an ordinary lawsuit of the type that if you look at the law these days the plaintiff 's going to have a great deal of diffi culty," says Luftspring. ZSA's claim seeks an injunc- tion that, among other things, prevents Berger from doing business with ZSA clients; calls for "an accounting from the de- fendants of all revenue earned by any of them resulting from a breach of Berger's non-com- Visit us online! lawtimesnews.com canadianlawyermag.com Fresh content delivered weekly. Canadian Lawyer | Law Times | 4Students | InHouse HouseAd-Online - page 7.indd 1 Willis & Winkler on Leading Labour Cases 2008-2009 Find out where the law is headed and what it means to you 7/23/09 5:13:23 PM petition, non-solicitation, and non-disclosure agreements, and/or a breach of her fi du- ciary duties to the plaintiff "; $750,000 in damages from Berger; $750,000 in damages from Marsden; and $150,000 for "aggravated damages and/ or punitive damages." Berger worked for ZSA as vice president and director of support services and law fi rm management from 2001 to 2009, according to the claim. She resigned in May. It says that Berger "was the face" of the company's opera- tions in recruitment of non- lawyer staff . It alleges that she "was one of the few employees granted shares in ZSA," and in her last year with the company earned over $550,000 in bo- nuses and commissions. ZSA accuses Berger of breaching "contractual and fi - duciary duties" in various ways. Th e claim includes a list of alle- gations, such as the following: • Th at Berger accepted a job with Marsden "in which she agreed to compete directly with ZSA" before resigning; • she "purged from ZSA's system approximately six months of her e-mail cor- respondence with ZSA's cli- ents and candidates"; • she "misappropriated from ZSA's IT department ZSA's confi dential account number for its Bell Mo- bility account," and "used the misappropriated ac- count number to cause Bell Mobility and/or Rog- ers Wireless to transfer the cellular telephone number belonging to ZSA into her own name"; and • that "Marsden is liable for inducing breach of contract and knowing assistance with breach of fi duciary duties." It states that ZSA needs a "full accounting" of Marsden's work in the area of legal re- cruitment in Canada. Berger and Marsden have issued a statement of defence and counterclaim, in which they deny ZSA's allegations. "It is the position of the defendants that the non-com- petition and non-solicitation provisions are void and unen- forceable as being contrary to public policy and that Caro- lyn has not used or disclosed any confi dential information," reads the statement. It says that Berger is respon- sible for recruitment of practis- ing lawyers at Marsden, "some- thing she was not allowed to do at ZSA." It goes on to suggest that she has not, and will not, disclose any confi dential infor- mation of ZSA. It later suggests, "It would be perverse to try to say there was a legitimate proprietary in- terest in preventing an employ- ee from doing something for a competitor which they did not do at ZSA." Th e statement also says ZSA's suggestion that Berger was a "key management em- ployee" is "absurd." "She was not a fi duciary and owed no fi duciary duties to ZSA," reads the statement. Berger also suggests in the statement that she felt com- pelled to resign, as her request to be permitted to recruit prac- tising lawyers was rejected, and it was "the only market that was at all active given the eco- nomic downturn." Th e statement adds that, "In addition, her decision was facilitated because the environ- ment at ZSA had become in- tolerably toxic because of the escapades, increasingly public travails, and aggressive behav- iour of Sweeney over the last two years." Berger denies the allega- This annual resource identifies key developments and addresses continuing and emerging issues important to your labour and arbitration practice. The 2008-2009 edition focuses on recent Supreme Court of Canada decisions which will shape the development of labour law in several critical areas, including: • the landmark decision • the Supreme Court's reconsideration of " • the • the , which revised the whole system of judicial review of administrative tribunal decisions " damages in case which provided guidance for courts with regard to the duty to mitigate in wrongful dismissal cases decision which clarified the test for establishing undue hardship The 2008-2009 edition also includes in-depth discussion and analysis of: • age discrimination and the extent to which mandatory retirement has been abolished across Canada • a look forward at current and emerging issues such as internet-related misconduct, occupational health and safety, strict liability of employers, and more! Find out how these decisions are shaping the law. Order your copy today. Perfectbound • 113 pp. • June 2009 • Standing order $74 • P/C 0145140000 Current edition only $84 • P/C 0145010000 • ISSN 1920-2393 tion regarding the deletion of e-mails, and says she used the cell phone number before ar- riving at ZSA, and accuses ZSA of wrongly taking hold of the number. "Th is allegation, just like the allegations regarding the cell phone number, is but a fur- ther desperate attempt by ZSA to try to embarrass Carolyn," reads the statement. Berger and Marsden argue that ZSA's claim for punitive damages "is unfounded in fact and as a matter of law and has been made for the sole purpose of trying to intimidate the de- fendants." Berger claims that ZSA For a 30-day, no-risk evaluation call: 1.800.263.2037 Canada Law Book is a Division of The Cartwright Group Ltd. Prices subject to change without notice, to applicable taxes and shipping & handling. Willis & Winkler on nLabour (LT 1-3x4).indd 1 www.lawtimesnews.com LT0000 owes her about $30,000 for placements "made and closed" while she was at the company. She also claims she is owed $80,000 in yearly distributions as a shareholder. LT 7/22/09 2:51:21 PM Elaine B. Willis and The H Chief Justice W Chief Justice of Ontario arren K. W onourable inkler, Keays W Dunsmuir Evans H ydro- Québec allace

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