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Zillow Just Swallowed a 130M Settlement For Hiring Two Execs From a Competitor...

Yes, that Zillow. You love the app.  You love cutting out the middleman of real estate.

But inside that business, they're a company with their own share of issues - just like you.

For example, Zillow raided a competitor for executive talent.  Non-competes and related IP policies be damned.  How's that working out for them?  Not great, but better than a few Zillowweeks ago. More from The Seattle Times:

"Zillow, the Seattle online real-estate information company, will pay $130 million to settle a lawsuit alleging that two executives it hired from rival Move Inc. stole trade secrets.

The settlement, disclosed in securities filings Monday, ends more than two years of litigation and removes the threat of a much larger financial blow to Zillow, the largest consumer real-estate web portal.

Silicon Valley-based Move, which is owned by News Corp., said it was seeking as much as $1.8 billion in damages.

The lawsuit stems from Zillow’s hiring of two ex-Move executives in 2014. Move sued Zillow less than two weeks after Errol Samuelson joined the Seattle firm as chief industry-development officer. Move filed a separate suit after another executive, Curt Beardsley, followed Samuelson.

Much of the attention in the dispute turned to Zillow’s July 2014 acquisition of rival Trulia, a $2.5 billion deal that created a giant in the business of online home-price information and advertising. Move’s Realtor.com and its other websites compete in that field.

Move said in a lawsuit that Zillow used confidential information from Samuelson to inform its acquisition of Trulia. Zillow denied that, saying it had been trying on its own to buy its rival since 2006.

The subsequent legal wrangling, and public comments by executives at both companies, had the rivals poised for a potentially nasty trial, which was set to start this month.

The deal stops Zillow’s expensive flow of legal bills. The company said it spent $15.7 million on its court battle with Move during the first three months of 2016. At the time, the company projected costs related to the suit to rise to between $18 million and $20 million during the current quarter."

Funky stuff happens when companies rip execs out of competitors. As I've said before, you can believe that non-compete is worthless, but you'll quickly learn a lesson that if the company you ripped the talent from feels scorned, the company with the deepest pockets can decide to inflict pain.

Of course, there's other details to this one, like one of the execs wiping his laptop clean when the legal challenge came.  Check this out:

"Zillow executives accused of destroying evidence in a $2 billion trade-theft case offered up a grab bag of reasons for deleting e-mails, smashing a hard drive and wiping their computers clean.

During a key court hearing this week, Errol Samuelson, a top Zillow exec accused of stealing confidential information from Move Inc., said he deleted documents because he didn’t want anyone to know his medical history — specifically, that he could be at risk of developing a rare and terminal hereditary health condition.

Samuelson, who was on the stand Wednesday, said his work computer held other personal health and financial details that he didn’t want others to know.

Beardsley destroyed a hard drive once connected to Move’s internal network by smashing it against a wall. Frustration motivated the incident, he testified.

He admitted as well to wiping data from two company-issued computers because he said he was trying to cover up his hardcore porn habit."

That whole disruptive Zillow thing just didn't happen people.  Tough choices had to be made!  LOL.

How'd you like to be the other exec that Zillow signed?  The one who apparently was straight up but has to answer questions and hear jokes about porn on his computer?

These details are better than summer TV.


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