Online real estate marketplace Ten-X has been granted a preliminary injunction motion that it filed against rival marketplace CREXi effective immediately. The preliminary injunction arises out of a lawsuit filed by Ten-X earlier this year alleging breach of contract, breach of duty of loyalty, and misappropriation of trade secrets against CREXi and its founder, Michael DeGiorgio, who formerly worked for Ten-X.
Ten-X, which rebranded earlier this year from Auction.com, created a platform that brings together buyers and sellers, and the agents and brokers who represent them, to conduct real estate transactions. According to a statement from Ten-X, the company has invested significant resources into developing its proprietary system and collecting data regarding customers, properties and transactions. The lawsuit maintains that in order to launch the CREXi business, DeGiorgio misappropriated Ten-X trade secrets, violated a proprietary information and inventions agreement, breached a duty of loyalty to Ten-X, and took steps to conceal this misconduct.
“Ten-X does not relish bringing lawsuits against former employees,” said Ten-X Chief Legal Officer Lee Leslie. “However, Ten-X management felt very strongly that what occurred in this case was wrong and that we had to take legal action to enforce our rights.”
In granting the preliminary injunction against CREXi and DeGiorgio, the court ruled that Ten-X was likely to succeed on the merits of its claims at trial. Until the litigation is resolved, CREXI’s website is barred from offering certain transactional features, including “any functionality empowering parties to make, display or negotiate offers, create and execute contracts, or manage and close transactions.”
DeGiorgio told propmodo.com, “We are disappointed by the ruling and are carefully examining our legal options. CREXi has developed a superior product and built an outstanding business, entirely on our own.” DeGiorgio described his former employer’s attack as misguided and he vowed to continue to fight the lawsuit.