Mortgage lender Guaranteed Rate alleges that while still employed at the company, one of its “most highly compensated executives” planned and participated in an exodus of more than 20 employees to a newly formed rival, according to a lawsuit filed by the Chicago-based company.
Joseph Caltabiano, the former senior vice president of mortgage lending at Guaranteed Rate who is named in the lawsuit, disputes those claims. “I deny the allegations that I did anything inappropriately,” he said.
The employees who left Guaranteed Rate allegedly joined the staff of Bemortgage, a recently launched mortgage lender that operates as a division of Bridgeview Bank Group, according to the lawsuit, filed Wednesday in Cook County Circuit Court. Caltabiano joined Bemortgage’s ranks as senior vice president of mortgage banking about two weeks ago, he said Friday.
Guaranteed Rate paid Caltabiano about $1.75 million this year through Nov. 15, according to the lawsuit. He was one of the three highest producing loan originators employed by the company, and remains the ninth largest shareholder, the complaint states.
The company “terminated” Caltabiano on Nov. 16, according to the suit. Court documents say Caltabiano allegedly coordinated the transition of Guaranteed Rate’s Chicago-area team to Bemortgage with senior executives at Bridgeview, some of who had also previously been employed at Guaranteed Rate.
Those team members’ transition allegedly had been planned while Caltabiano was still employed at Guaranteed Rate, according to the complaint. The lawsuit alleges that Caltabiano breached his fiduciary duties to Guaranteed Rate by soliciting its employees to leave and join Bemortgage and by competing with it on behalf of Bemortgage.
“Mr. Caltabiano was terminated for misconduct, as described in our lawsuit,” Guaranteed Rate said in a statement Friday.
Caltabiano denied those allegations and said he disagrees that Guaranteed Rate terminated him. He said he worked there for 15 years and that it was a good place to work, but the time had come to explore more opportunities.
“I have a staff that works with me that voluntarily decided to pursue other opportunities as well,” he said. “You’ve got a lot of new opportunities in the mortgage banking space that weren’t here five years ago.”
Also named in the suit is Bridgeview Bancorp, holding company of Bridgeview Bank, which has about 15 locations throughout the Chicago area. The lawsuit also alleges Bridgeview and Caltabiano conspired to breach their fiduciary duties. Peter Haleas, chairman of Bridgeview’s board, said the bank did nothing wrong.
“I know that Bridgeview conducted itself in the full spirit of the law and business ethics, and we have no culpability,” he said.
In May, Guaranteed Rate filed an unrelated lawsuit alleging an employee and two former employees solicited other workers to join competitor Cross Country Mortgage and planned to open competing branches while still employed by Guaranteed Rate. The case was dismissed in September, according to court documents.