Old National Bank has sued Bell Bank, alleging the Fargo, North Dakota-based lender orchestrated an “en masse resignation” of senior employees from two Minnesota ONB branches this month and immediately transferred those employees to Bell.
The lawsuit, filed Monday in federal court in Minnesota, named the eight former ONB employees as defendants, alleging they took with them confidential information and customer relationships.
Every senior business and commercial bank employee at ONB’s Brainerd, Minnesota, location “simultaneously resigned” on the morning of Dec. 8, forcing the branch to close, ONB said. At the same time, key employees at the Baxter, Minnesota, branch three miles away also resigned, shuttering the branch’s lobby, according to the lawsuit.
The “coup d’état,” Evansville, Indiana-based ONB alleged, was “designed to cause maximum disruption” at the bank; and the coordination “could only have been accomplished through weeks (if not months) of careful planning” while the employees still held a “fiduciary duty of loyalty” to Old National.
After submitting resignation letters with “identical typographical errors,” the former ONB employees allegedly removed boxes of documents and materials from their respective branches without giving the bank’s human resources or corporate security personnel the chance to inspect them.
“Within hours, Bell Bank had positioned the Former Employees in roles to service the very same customers they had handled at ONB,” the lawsuit alleged. “On the same day as the mass resignation, ONB’s clients, such as Cedarbrook Lumber, were actively solicited to move their business to Bell Bank, based on the rationale that ONB no longer had a branch presence in the Brainerd-Baxter area, and was incapable of servicing their banking needs.”
The former ONB employees have been “actively calling ONB’s top bankers and trying to convince them to leave ONB and join them at Bell Bank,” according to the lawsuit, in a bid to poach “knowledgeable and well-trained staff” for an as-yet-unopened Bell branch in Brainerd “[r]ather than investing the time, effort, and money required to develop a successful branch over time.”
Following the employees’ departure, ONB asked them to certify in writing that they did not possess any confidential information, and that they had not and would not disclose any confidential information to Bell. The former employees did not provide this information to ONB, spurring the lawsuit, the bank said.
A spokesperson for Bell Bank disputed allegations of wrongdoing and said the bank “looks forward to demonstrating why these employees left Old National Bank and joined Bell Bank.”
“We are excited to have these new team members on board, and we look forward to serving and working with the communities of Brainerd and Baxter,” the spokesperson said.
A spokesperson for ONB declined to comment on active litigation or personnel matters.
In May, ONB closed on its $1.4 billion purchase of St. Paul, Minnesota-based Bremer Bank. It was Bremer that spent “decades of hard work and investment” building out the Brainerd-Baxter market, according to Monday’s lawsuit.
ONB laid off 244 former Bremer employees in September. It’s not clear how many of those affected employees worked at the Brainerd or Baxter locations.
