A U.S. District Judge on Monday approved an agreement between parties stipulating that a “forensic vendor” be brought in to copy and preserve any confidential information belonging to payment business Flexible Finance on the personal devices of payments executive Alex Anderson.
The order comes a week after Flex requested “emergency relief” by Aug. 10 in relation to a civil suit filed by the company which alleges Anderson misappropriated trade secrets when interviewing for the business’ CFO seat and passed them to a competitor, where he presently serves as CFO, according to the lawsuit. The motion asked for a temporary restraining order preventing Anderson from further use of its trade secrets. It also asked defendants Anderson and fellow defendant, Split Pay — a Flex competitor and alleged employer of Anderson — to show cause and for the protection of their information.
The forensic review order was signed by Judge Margaret M. Garnett in a filing Monday and provides that the parties “hereby stipulate and agree” that defendants’ counsel will tap the forensic expert to find any confidential information as defined in a previous non-disclosure agreement signed by Flex and Anderson.
The vendor will look through Anderson’s personal computer, “relevant portions” of his personal email or any other electronic devices and cloud accounts which “were used to access, download or store Flex confidential information,” as well as any hard copies of such information, the order notes. Based on their investigation so far, defendants “represent that the Flex Confidential Information has not been shared by Mr. Anderson with anyone at Split Pay and agree that the Flex Confidential Information will not be shared with anyone at Split Pay,” according to the Monday filing.
Anderson and Split Pay’s counsel shall “conduct a reasonably diligent investigation to identify Flex Confidential Information in Mr. Anderson’s possession, custody and control, including appropriate discussions with Mr. Anderson to identify the locations where Flex Confidential Information may be found,” according to the Monday order.
“The forensic image and copies created and preserved as described above shall be retained solely in the custody of Defendants’ counsel and/or its forensic vendor for purposes of this litigation,” the order notes.
Filed last week with the U.S. District Court for the Southern District of New York, the suit alleges Anderson took advantage of his interview process with Flex, a payment provider, to “mine” the business for trade secrets he then allegedly passed to its competitor, Split Pay, CFO Dive previously reported.
A finance executive with experience at payment companies including Square owner Block, Anderson began an interview process with Flex at the start of this year, according to the Aug. 3 complaint. However, unbeknownst to Flex, he was also allegedly interviewing with Split Pay during the same time frame, and the suit alleges he utilized his access to confidential information provided by Flex under an NDA to pass along the company’s strategic “crown jewels.”
The suit alleges Anderson has served as CFO for Split since this July. The payments executive is not listed as part of Split’s leadership team on a company webpage, and Anderson’s LinkedIn profile currently shows him as occupying a role at Block. A Block spokesperson stated Tuesday Anderson is no longer employed with the company.
Both the New York-based Flex and the Miami-based Split Pay offer services which allow users to break larger transactions, such as mortgage or rent payments, into multiple payments, according to their respective websites.
The suit alleges that Anderson passed along confidential information belonging to Flex he received during his interview process, including a memo addressed to the company’s board which detailed its financial models and future business plans, CFO Dive previously reported. The information also included the “Flex Margin Model,” described as the company’s “most sensitive financial model,” according to the Aug. 3 complaint.
As stipulated in the Monday order, the counsel for the defendants requires the forensic vendor to delete any copies of the board memo, the Flex Margin Model, or “other documents or files containing Flex confidential information” from Anderson’s file locations.
Attorneys for Anderson and Split Pay did not immediately respond to requests for comment. Attorneys for Flex did not immediately respond to requests for comment.
