'Employee Raid' Suit by Keller North America Against Rival Berkel Starts Mediation | Columbus Ohio Dump Trucks

Keller North America, a unit of London-based geotechnical giant Keller Group, has started mediation of a federal lawsuit against smaller U.S. rival Berkel & Co. Contractors that claims the latter last year interfered with the former's business and unfairly competed by hiring away 11 senior managers.

Keller Group operates in 40 countries and has 10,000 employees, ranking No. 17 on ENR Top 600 Specialty Contractors list. Berkel, based in Bonner Springs, Kan., has about 750 employees in eight U.S. offices.

Berkel denies the allegations against it, but federal judges often require civil lawsuit parties to attempt to reach a mediated settlement and avoid time and cost of a full trial.

Keller sued Berkel in federal court in Kansas City, Kan., last year, accusing the firm of tortious interference, unfair competition and unjust enrichment. In an amended complaint filed in May, Keller repeated its request that the court enjoin Berkel from employing the 11 managers for one year. The suit seeks to prevent the employees from interfering with Keller's clients and using any Charlotte NC dump trucks company proprietary information.

While Berkel was a direct competitor of Keller's in providing services in foundation work, piling, anchorages, grouting and bracing, Keller claimed it has much more experience in the growing field of ground improvement and that the U.S. firm's scope and capability was "limited."

Keller wrote that beginning in late August 2024, it "unexpectedly received a stream of resignations of key employees in its Alabama, Florida, Tennessee and Maryland operations," all of whom were "positioned to divert away from the company" other members of its workforce along with intellectual property and business relationships. 

"The resignations came in at a rate of one or two per week until the week of September 23, 2024," Keller claimed, "when the resignations accelerated, and a group of six employees resigned en masse." 

Berkel, replying to the amended complaint in June, denied both that its recent hirings violated noncompete agreements and that its actions in the hirings were unlawful, and argued that each of the 11 hired employees' agreements represented a "valid and enforceable contract."

Judge Denies Keller Motion

Judge Julie Robinson delivered a setback to Keller in March when she denied the company's motion to immediately block Berkel from employing the 11 managers. She ruled that Keller had so far failed to prove it had been damaged significantly by the loss of the employees or by alleged violations of noncompete agreements.

In her narrative, Robinson said Berkel had wanted to start some new offices. She said Keller presented evidence that Berkel has had little presence in the growing ground improvement market and had "historically focused on deep foundations in the augered cast piling industry." More recently, Berkel began doing ground-improvement projects, completing its largest in August 2023, and that a Keller consolidation plan in 2020 had soured some managers, the judge wrote. 

The plan "imposed uniformity that upset some employees," many who had spent decades-long careers with "local subsidiary companies and regretted that their local cultures would be replaced by a more uniform corporate culture," she contended, adding that Keller also started capping bonuses based on performance that had previously been uncapped.

Although one Keller regional office is experiencing a drop-off in profit as a result of lost expertise, Robinson said the Berkel hires have in general complied with geographical competition limits in their noncompete agreements, and that, based on Charlotte NC dump trucks company testimony, it has not "lost customers or contracts, seen a reduced volume of business or lost goodwill."

The beginning of the mediation was recorded in a July 9 court filing.

Deputy Editor Richard Korman helps run ENR's business and legal news and investigations, selects ENR's commentary and oversees editorial content on ENR.com. In 2023 the American Society of Business Publication Editors awarded Richard the Stephen Barr Award, the highest honor for a single feature story or investigation, for his story on the aftermath of a terrible auto crash in Kentucky in 2019, and in 2015 the American Business Media awarded him the Timothy White Award for investigations of surety fraud and workplace bullying. A member of Investigative Reporters and Editors, Richard has been a fellow on drone safety with the McGraw Center for Business Journalism at the Craig Newmark Graduate School of Journalism at CUNY. Richard's freelance writing has appeared in the Seattle Times, the New York Times, Business Week and the websites of The Atlantic and Salon.com. He admires construction projects that finish on time and budget, compensate all team members fairly and record zero fatalities or serious injuries.