Hedgeye Risk Management, LLC v. Heldman

United States District Court for the District of Columbia · 2019 · Corporations

Updated August 22, 2026

Corporationsfiduciary dutyemployee loyaltycompetitionbreach of fiduciary dutyemployee solicitationmass resignationcustomer solicitation

Facts

Hedgeye bought the assets of Potomac Research Group, and Heldman worked for Hedgeye for about five weeks while negotiating possible continued employment. During that period, Heldman discussed with team members Sasha Simpson and Raca Banerjee whether they should sign Hedgeye employment agreements, told Banerjee to hold off signing, and had multiple discussions with Simpson about forming a new business. Heldman left Hedgeye on January 21, 2016, and within about an hour Simpson and Banerjee also resigned; the three then met in the parking lot, went together to Simpson’s apartment, and the next day Heldman and Simpson announced a competing firm, which used business cards Heldman had accumulated, including some acquired during his PRG/Hedgeye tenure, to create its initial client list. Hedgeye claimed Heldman breached his fiduciary duty by soliciting clients, causing a mass resignation of employees, and using confidential information to compete.

Issue

Whether Heldman was entitled to summary judgment on Hedgeye’s breach of fiduciary duty claim. Specifically, the court asked whether the evidence could permit a reasonable jury to find that, while still employed by Hedgeye, Heldman solicited Hedgeye clients, improperly solicited employees to leave and join his competing venture, or misappropriated confidential information.

Rule

Under D.C. law, a breach of fiduciary duty claim requires a fiduciary duty, breach, and proximate injury. Employees owe their employers undivided loyalty during employment, but absent agreement to the contrary they may prepare to compete before departure; that privilege is limited and does not permit wrongful acts such as misuse of confidential information, solicitation of the employer’s customers before termination, or solicitation leading to a mass resignation of employees. On summary judgment, the court asks whether record evidence would permit a reasonable jury to find for the nonmovant, drawing all reasonable inferences in that party’s favor.

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Nina Park worked for Harbor View Analytics, a policy-research firm in Washington, D.C., while quietly planning to launch a competing shop in Arlington, Virginia. Before resigning, she logged into the firm's client database far more often than usual, but three deposed customers testified she never contacted them before leaving, and Nina submitted a sworn declaration denying any pre-resignation outreach.

If Harbor View sues Nina for breach of fiduciary duty based on pre-termination client solicitation and Nina moves for summary judgment, how should the court most likely rule?

Explanation. Under D.C. law as applied by the majority opinion, an employee may prepare to compete, but may not solicit the employer's customers before termination. Still, at summary judgment the employer must point to evidence from which a reasonable jury could find actual solicitation. Evidence of increased access to a client database, without evidence of contact or solicitation, is insufficient—especially where customer testimony reveals no solicitation and the employee denies it under oath. (Derived from Hedgeye Risk Management, LLC v. Heldman (n.d.).)