Hernandez sues RealPage over alleged secrets theft

US: Miami-based real estate developer and founder and CEO of NGD Homesharing, Harvey Hernandez, has begun legal proceedings against property management software company RealPage over allegations it stole trade secrets and took employees from Hernandez’ firm, according to real estate news website The Real Deal.

The website reported that NGD Homesharing was pursuing a lawsuit against Dallas-based RealPage, an affiliate and three staff previously under the employment of Hernandez. He alleges that those former workers misappropriated NGD’s proprietary technology and trade secrets to gain an advantage over their former employers, according to a court filing from the Miami-Date County Court seen by The Real Deal.

It is alleged that the defendants [RealPage] “engaged in a wrongful pattern of conduct and tortuous activity intentionally designed to gut NGD of its good will, proprietary technology, employees and to unlawfully usurp NGD’s business”.

The complaint centres around a rumoured non-disclosure agreement signed between Hernandez and RealPage CEO Stephen Winn in November as the two companies began discussing potential opportunities, however the former now alleges that the latter used the confidential information about NGD’s technology to its advantage by creating an “unlawful plan to poach and usurp NGD’s employees, and valuable goodwill and technology”.

The three workers at the heart of the complaint are Kayla Neller, the vice-president of program management at RealPage, and current RealPage vice-presidents Collin Ross and Todd Butler, the latter a former CFO of NGD. The complainants in the lawsuit further allege that the trio “conspired and worked together to attempt to undermine NGD’s business” and that they had circulated NGD’s technology, software and confidential financial information, which would represent a breach of their respective contracts.

The Real Deal reported that RealPage had submitted an offer for NGD’s intellectual property and software for its Niido platform on 15 February, although this was declined by NGD. After that, RealPage was said to have explored the possibility of hiring key members of NGD’s technical team, something which was deemed by the latter to have been an attempt by RealPage to create “a false trail of interest in pursuing an acquisition of NGD’s technology, when RealPage’s true motivation was to allegedly steal trade secrets and proprietary information, and to poach the employees who created the technology”.

NGD, which develops technology for owners and operators of multifamily communities to help them rent out their units on home-sharing platforms such as Airbnb, said it was now seeking compensation, temporary and permanent injunctive relief and attorney fees and costs.

This is the latest in a spate of legal battles for Hernandez in recent months.

In May, Centro NGD Holdings, owned by Hernandez, was sued for allegedly defaulting on a $2 million loan to Miami-based private lender BridgeInvest for a Centro Tower project in downtown Miami.

Two months prior to that, he settled a separate lawsuit against Airbnb, in which it was alleged that his company, NGD Homesharing, defrauded the global booking platform as part of their business partnership and stole $1 million. NGD sued Airbnb itself in January for allegedly engaging in a pattern of “disruptive, dilatory, tortious and bad-faith actions inconsistent with, and in violation of, the legal and contractual obligations Airbnb owes to NGD”.

Eventually, both sides reached a settlement in March, with the two lawsuits being voluntarily dismissed with prejudice.

Meanwhile last year, Hernandez’ development company was the subject of legal action for a robotic car garage at a luxury condo tower in Miami which malfunctioned and left residents without a functioning space to keep their cars. The group was forced to pay over $40 million to the Brickell House condo association as compensation.