The Agency sues Compass for blocking exec from recruiting former colleagues

Compass’ move against Agency president — which cites non-solicitation clause — is illegal, suit contends

Los Angeles /
Apr.April 22, 2021 04:00 PM
Mauricio Umansky, Rainy Hake Austin and Robert Reffkin (Getty)

Mauricio Umansky, Rainy Hake Austin and Robert Reffkin (Getty)

In October, Rainy Hake Austin jumped from head of operations for Compass’ West Coast division to president of luxury brokerage The Agency.

But when Austin tried to recruit former colleagues, Compass shut the door, citing a clause in her contract she had signed, according to Inman.

Now, The Agency is fighting back. In a federal lawsuit filed Friday, the Beverly Hills-based firm claims Compass’ non-solicitation provision is illegal, and adds that Austin did not actually violate it anyway, according to the report.

Austin was with Compass since March 2019, when the brokerage acquired Northern California-based Alain Pinel Realtors, until her departure for Mauricio Umansky’s brokerage.

A Real Deal investigation earlier this year found that several current and former Compass agents said they had difficulty leaving the firm because of costly clawback provisions in their contracts they hadn’t fully understood at signing.

Compass has faced two other recent lawsuits. The brokerage, which went public on April 1, was sued days later by Pennsylvania-based brokerage Howard Hanna over alleged agent poaching and stolen trade secrets.  Compass encouraged three former Hanna brokers to breach their contracts when they jumped ship, according to Hanna’s suit.

And earlier this year, a former Compass agent sued the firm, this time over allegations of bait-and-switch tactics.

Compass has been on the offensive in court this year, as well. In late January, Compass countersued Realogy, alleging its rival was “flooding the market with false information about Compass” to hurt its business.

[Inman] — Dennis Lynch


Related Articles

arrow_forward_ios
Abraham Edgardo Ortega is one of nine people charged in the laundering scheme. (Getty, Department of Justice)
Former Venezuelan oil exec sentenced in $1B money laundering scheme
Former Venezuelan oil exec sentenced in $1B money laundering scheme
Ira Drukier with the Hotel Chelsea (Getty, Patrick McMullan/Getty)
Chelsea Hotel owners sue city for $100M over renovation delays
Chelsea Hotel owners sue city for $100M over renovation delays
RSA's Joseph Strasburg and Judge Lawrence Marks (Getty, Strasburg via Jeffersons Siegel)
Landlord group challenges state eviction ban
Landlord group challenges state eviction ban
RXR Realty's Scott Rechler with 75 Rockefeller Plaza (Getty, David Shankbone/Wikimedia)
RXR Realty serves American Girl with a lawsuit
RXR Realty serves American Girl with a lawsuit
U.S. District Court Judge Dabney Friedrich (Senate/Chris Coons, iStock)
Judge strikes down federal eviction ban
Judge strikes down federal eviction ban
Grant Cardone (Getty)
Grant Cardone crushes lawsuit accusing him of misleading real estate investors
Grant Cardone crushes lawsuit accusing him of misleading real estate investors
Lisa and Todd Sheppard with Compass CEO Robert Reffkin (Team Shep, Getty)
Compass hit with another lawsuit from former agents
Compass hit with another lawsuit from former agents
Phyllis and Mitchell Kossoff (Getty, iStock)
Vanished attorney’s mother claims son forged her signature on loan docs
Vanished attorney’s mother claims son forged her signature on loan docs
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...