Klein and Amar Lalvani were two top executives at the Starwood hotel chain when they were recruited by Starwood’s chief competitor, Hilton, to help it start a new line of “lifestyle” hotels to compete with Starwood’s popular “W” hotels. According to a lawsuit filed by Starwood, the two executives are alleged to have absconded with over 100,000 confidential Starwood documents on their way out the door. Together, the documents constituted a “blueprint” for starting a new hotel brand, and plans for a Hilton chain dubbed “Denizen” that closely mirrored the “W” were announced soon after their arrival at the new firm. In December, 2010, Hilton settled the suit with Starwood, paying their competitor $75 million in cash and promising another $75 million in hotel-management contracts. Hilton was also prohibited from introducing any lifestyle hotels before 2013 and assigned two federally appointed monitors observe the company’s activity. Klein and Lalvani have not yet faced charges, but were personally barred from working for certain firms in the hospitality industry for two years, as well, as part of the agreement.
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