Ex-Korn/Ferry Executive Convicted of Trade-Secret Theft

David Nosal, former regional managing director at Korn/Ferry International, was convicted of trade-secret theft and hacking for gaining access to the job search firm’s proprietary database of executives.

Nosal, who worked for the Los Angeles-based executive recruitment firm in Silicon Valley and other locations from 1996 to 2004, obtained reports and data from Korn/Ferry’s “Searcher” database after he left the firm to start his own executive search business, prosecutors said in court filings. Searcher is a highly confidential computer system about companies, executives, salaries and personal information.

Nosal, 55, of Danville, California, agreed to work with Korn/Ferry on some executive search assignments for about a year after his departure and was barred from competing with Korn/Ferry or using its business secrets under the terms of a separation agreement he signed. Two other Korn/Ferry executives who left the firm after Nosal did set up their own companies that could be used as vehicles for Nosal to conduct executive recruitment until the agreement expired, prosecutors said in court filings.

The two used Nosal’s ex-secretary’s log-in credentials to get “Searcher” reports for him. The secretary and the other two former executives pleaded guilty to conspiracy charges and cooperated with prosecutors, according to the filings.

A federal jury in San Francisco deliberated for two days after a two-week trial in which Nosal’s ex-secretary and a former coworker testified for prosecutors, court filings show.

Nosal was first indicted in 2008. The maximum penalty for the most serious charges is 10 years in prison and a $250,000 fine or twice the gain or loss caused by the conduct. Sentencing is scheduled for Sept. 4.

Steven Gruel, a lawyer for Nosal, and Michael Distefano, a Korn/Ferry spokesman, didn’t immediately respond to e-mail messages seeking comment on the verdict.

The case is U.S. v. Nosal, 08-cr-00237, U.S. District Court, Northern District of California (San Francisco).

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