B. Riley Accuses Former Investment Banking Head of Stealing Clients and Staff

B. Riley Financial Inc. has accused its former investment banking president of conspiring to poach clients and staff for his new employer, Texas Capital Bank. The allegations were made in a lawsuit filed last week in Dallas.

B. Riley claims that David Merriman, who suddenly left the company before Thanksgiving, collaborated with Texas Capital prior to his resignation. The lawsuit states that Merriman's departure was part of a long-standing plan involving Texas Capital Securities, aimed at misusing B. Riley's trade secrets and confidential materials.

Representatives for Texas Capital Bank and Merriman were not immediately available for comment.

In the lawsuit, B. Riley alleges that Merriman and Texas Capital compiled a list of B. Riley investment bankers they planned to entice before Merriman's departure. The firm claims that Merriman used confidential information about B. Riley's operations to target its highest-earning employees.

The complaint also accuses Merriman of sending confidential information regarding current and potential business opportunities at B. Riley to his and his spouse's personal email addresses. It is alleged that he began adding his personal email as a secret recipient in communications with a B. Riley client more than a month before his resignation.

The lawsuit states: "On the second day of Merriman's employment at Texas Capital Securities, he hastily and directly attempted to divert one of B. Riley's valuable investment banking clients from B. Riley to Texas Capital Securities in a reckless manner."

The firm seeks a court order to prevent Merriman and Texas Capital from using confidential information obtained from B. Riley and requests the return of all records to the firm.