Judge postpones trial in Cavner, U.S. Bancorp case

U.S. Bancorp Investments Inc. first filed the suit in U.S. District Court two days after investment guru Nadia Cavner joined The Signature Bank – now BancorpSouth – in September 2005. It alleges that Cavner violated her confidentiality and nonsolicitation agreements by “improperly attempting to lure away” her former U.S. Bancorp clients.

The case was scheduled to go to trial Aug. 20, but U.S. District Judge Richard Dorr recently issued an order rescheduling the jury trial for Dec. 3 to allow more time for a forensic computer investigation.

In April, Dorr appointed technical adviser Mark Johnson to conduct the investigation in response to sanction motions filed by U.S. Bancorp’s attorneys. The motions allege that Cavner and her staff did not return all electronic files taken from U.S. Bancorp Investments and that they “failed to take steps to identify and preserve relevant electronic evidence,” records show.

Dorr has authorized Johnson to perform additional analysis of computer Internet history as it relates to the opening and accessing of files and to examine evidence that software was used to erase files, records show. Dorr also instructed other forensic examiners involved in the case to provide Johnson with their reports.

Other motions recently filed in the case have focused on whether the defendants should be allowed to present evidence that Cavner’s clients would have followed her to The Signature Bank regardless of the alleged wrongdoing.

The defendants’ attorneys have argued that Cavner and her team should be allowed to present evidence of “their remorsefulness and regret for their actions” in response to U.S. Bancorp’s request for millions of dollars in punitive damages, records show.

In February 2006, Dorr ordered Cavner to pay $51,000 in sanctions for making false representations during a Dec. 7, 2005, court hearing. And last October, a National Association of Securities Dealers arbitration panel ordered Cavner to pay $325,000 in compensatory damages to U.S. Bancorp Investments. The panel also ordered co-defendants Steven Clark and Becky Angus to pay $25,000 and $2,000, respectively.

In her 14 years with U.S. Bancorp, Cavner built a client portfolio valued between $363 million and $450 million, according to court records.