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Noble rejects ex-CEO's lawsuit, saying he planned rival with BTG

Thursday, March 5, 2015 - 14:35
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Noble Group said its former chief executive Ricardo Leiman, who is suing Asia's biggest commodity trader for a 2011 bonus and shares, shouldn't get them as he met Brazil's BTG Pactual to discuss setting up a rival business.

[SINGAPORE] Noble Group said its former chief executive Ricardo Leiman, who is suing Asia's biggest commodity trader for a 2011 bonus and shares, shouldn't get them as he met Brazil's BTG Pactual to discuss setting up a rival business.

Mr Leiman solicited 23 employees to join the Brazilian bank while on a US$350,000-a-year advisory contract with Noble, the Hong Kong-based trader said in Singapore High Court papers detailing earlier claims. He was hired by BTG in October 2012.

Noble, which last week reported its first quarterly loss in more than three years, said employees including its former chief operating officer and chief risk officer have since joined BTG. Mr Leiman denies breaching confidentiality and other duties, saying in papers filed last month that not all of the employees Noble refers to have joined BTG, which started commodities trading in 2013.

Mr Leiman said his meetings in 2012 with former Noble director Kenneth Courtis, who's since become a director at BTG, were social or to discuss an asset management business. Noble claims they discussed forming with BTG a "new Glencore," referring to the world's largest-listed commodities trader.

BTG, Mr Leiman and Mr Courtis declined to comment, the Sao Paulo- based bank said in an e-mail. Noble spokesman Stephen Brown declined to comment.

Noble Resources, the unit sued by Mr Leiman in 2012, lost its bid that year to seal the court file. It had said disclosures could materially affect Noble's share price and undermine its commercial interest. Leiman added the Singapore- listed parent as a defendant in October.

The commodity trader on Feb 26 posted a surprise US$240 million fourth-quarter loss, following two anonymous reports alleging accounting malpractice. Noble denies the reports, which it believes are the work of an employee fired one-and-a-half years ago. It has passed information on the person to Singapore's market regulator and doesn't plan legal action.

The stock has fallen 16 percent since the first report on Feb. 16 compared with a 0.5 percent decline on the benchmark Straits Times Index. Noble Chairman Richard Elman and director Richard Paul Margolis this week raised their stakes while Standard & Poor's affirmed the company's credit rating.

Mr Leiman sued Noble for a US$12.9 million bonus and rights to 67.7 million restricted shares and options in a trust. Noble said Leiman was fired as it was "unhappy" with his performance while the former executive claimed the company was "mischievous" in labeling his departure as a dismissal.

Noble had announced Mr Leiman's resignation on Nov 9, 2011 the same day it posted its first quarterly loss in about 14 years. Mr Leiman left for "personal reasons" and would stay on as an adviser, the company said at the time. Mr Leiman's advisory agreement ended in Aug 2012.

BLOOMBERG