A leading real estate website could be looking at serious financial repercussions in a contentious lawsuit over trade secret theft.
According to a HousingWire report, Move, which operates Realtor.com for the National Association of Realtors, is claiming that Zillow owes it $2 billion in damages. Move’s lawsuit against Zillow, originally filed in 2014, stems from the departure of Errol Samuelson, once Move’s chief strategy officer.
According to HousingWire, Samuelson resigned from Move on March 5 of 2014 and went to work for Zillow – as the company’s second-highest paid executive – the same day. Move alleged that Samuelson and Zillow stole trade secrets and attempted to cover up the theft.
This is the first time Move has stated exactly how damaging that alleged theft was, according to HousingWire, which obtained legal documents concerning the case. If the full $2 billion is awarded to Move, Zillow could be financially crippled, HousingWire reported. The company’s most recent filing with the SEC showed it had just $523.35 million cash on hand. And Yahoo Finance reports that Zillow has a current market cap of $4.11 billion.
“The scope of this case – and the damages claim – is staggering,” Zillow said in a court filing obtained by HousingWire.
And the lawsuit is already hurting Zillow. The company reported a net loss of $91.1 million in 2015, driven largely by the legal battle.
For its part, Zillow insists that the lawsuit is meritless.
“Plaintiffs would like to go to trial and throw as many claims as possible against the wall so as to increase the probability of jury confusion so one or two might win,” the company said in a court filing.
But Move is having none of it.
“Zillow’s claim that the litigation is ‘baseless’ is proven false by a mountain of evidence of Himalayan proportions, including proof that numerous documents, texts and emails were destroyed and computers, smartphones and other storage devices were intentionally wiped out or destroyed,” a Move spokesperson told HousingWire. “…In the end, this may prove to be, for Zillow, a very regrettable act of executive poaching.”