Accusing it of corporate espionage, theft of trade secrets and unfair competition, Starwood Hotels & Resorts Worldwide has filed suit against Hilton Hotels Corporation, it announced last week.
In the lawsuit that it filed in New York on April 16, Starwood accuses two former Starwood executives who now work for Hilton—Ross Klein, global head of Hilton Luxury & Lifestyle Brands, and Amar Lalvani, global head of Hilton Luxury & Lifestyle Brand Development—of aiding and abetting the hotelier by stealing proprietary information. Among the documents stolen, according to Starwood, were strategic plans, confidential deal terms and step-by-step playbooks that Hilton allegedly used to expedite the development of its new lifestyle luxury brand, Denizen Hotels, in the mold of Starwood's W brand.
"Starwood seeks to avoid litigation, but the egregiousness of the conduct and the volume of highly confidential documents taken left us no choice but to take this strong action to protect our brands and intellectual property for the benefit of our investors, associates, owners and customers," Starwood's Chief Administration Officer and General Counsel Kenneth Siegel said in a statement. "The wholesale looting of proprietary Starwood information, including a step-by-step playbook for creating a lifestyle luxury hotel brand, unfairly enabled Hilton to launch a new brand in only nine months instead of the usual three to five years."
Although Starwood says Hilton volunteered "eight large boxes of hard copy documents as well as computer hard drives, zip drives and thumb drives containing more than 100,000 electronic files downloaded from Starwood computers"—which it said had been acquired by Klein and other Hilton employees who formerly worked at Starwood—Hilton denies any wrongdoing.
"Hilton Hotels Corporation believes this lawsuit is without merit and will vigorously defend itself," Hilton said in a statement. "We fully intend to move forward on the development of our newest brand, Denizen Hotels."
In addition to monetary compensation, Starwood is seeking a court order that will force Hilton to cancel the rollout of its new Denizen brand, which it announced last month.