Mizuho sued for $750m by Calyon

16 March 2007

Credit Agricole's investment bank wing Calyon is to sue Japan's Mizuho for $750 million following the defection of eleven staff from its American debt trading team.

Calyon alleges that the staff, that left to work for Mizuho in December, were poached illegally and is seeking $600 million in punitive damages and a further $150 million in compensatory damages.

The complaint to the United States District Court also seeks to prevent Mizuho from dealing with any of the parties about whom Calyon's collateralised debt obligation (CDO) former staff would have had confidential information.

Mizuho has countered that the allegations are "without merit" and added that: "Calyon's former employees left Calyon for Mizuho of their own volition. They were not recruited by Mizuho directly or through a search firm."

Since the defection, Calyon claim that their ability to function in the CDO sector has been significantly impaired and that their reputation has been tarnished.

The staff that joined Mizuho include Douglas Munson and Alexander Rekeda, who were senior executives within Calyon's CDO unit.

Last week, Credit Agricole posted 9.8 per cent growth in fourth quarter profit.

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