Competition is fierce among Nashville-area banks for the business of healthcare enterprises. Now one bank is saying a senior lender from its healthcare unit overstepped legal bounds in order to gain a competitive edge when he bolted for a rival institution. And Regions Bank is making a federal case of the matter.
Regions Financial Corp., the Birmingham-based parent of Regions Bank, filed suit yesterday in Nashville's federal court against Bill Berrell, a former senior vice president of the bank. The legal action comes less than a month after Berrell left Regions and went to work at US Bank, just a couple of blocks away on Fourth Ave. N.
The complaint, available at this link, claims that Berrell took confidential information on customers and prospects of Regions with him as he left his job in its healthcare division. It cites a number of e-mails containing proprietary information that Berrell sent from his work account to his home account between March and May of this year.
One message included a "preliminary business report, summarizing and analyzing a potential loan opportunity for a Regions customer," and another covered "Regions' attempt to develop a relationship with a potential customer."
The filing also recounts an anonymous tip left with Regions' ethics and compliance hotline on June 8, reporting that a Regions employee was seen taking a customer file to Berrell at US Bank.
Accusing Berrell of a "willful and malicious" violation of the Tennessee Uniform Trade Secrets Act, Regions asked for an immediate injunction to stop him from using the information to its detriment. U.S. District Judge Aleta A. Trauger granted the bank's motion for a temporary restraining order yesterday and set a hearing on further injunctive relief for Thursday.
The lawsuit seeks exemplary damages under the Trade Secrets Act and other damages for violation of the federal Computer Fraud and Abuse Act. It asks for "the return of all salary and benefits paid or provided by Regions to Berrell during the period of his breach of duty of loyalties." And Regions also wants compensation for profits it has lost because of Berrell's alleged acts.
US Bank is not named as a defendant, but the lawsuit could pit bank against bank as it plays out. It demands that Berrell "immediately make any and all computers in his possession, custody or control on which such information is stored available for Regions' inspection." Some of those computers might well belong to US Bank.
Reached at work yesterday, Berrell said he had seen the lawsuit but would not comment until he could confer with counsel. "I've never been through anything like this before," he said.
Keith Frazier and Kay Caudle, from the Nashville office of the national labor law firm Ogletree Deakins, are representing Regions.
Berrell is one of several former AmSouth bankers who have left Regions since it merged with AmSouth last year. At AmSouth, where he had worked since 2000, Berrell dealt with healthcare loan customers including HCA and Psychiatric Solutions, according to filings with the Securities and Exchange Commission.
As one of the most promising business banking segments Nashville has to offer, healthcare is the focus of aggressive efforts by recruiting firms to poach experienced lenders -- especially in the wake of mergers such as last year's AmSouth-Regions deal that alter the local competitive landscape.