SAN FRANCISCO — A civil complaint filed by Top 100 retailer Arhaus in the U.S. District Court for the Northern District of California alleges that a former executive took confidential information and trade secrets with her when she left to work for a competitor.
The complaint, filed on July 24, alleges that Lisa Chi, who left the Delaware, Ohio-based retailer for a position with Top 100 retailer RH, misappropriated trade secrets and confidential information from Arhaus, violated a confidentiality agreement signed in 2022, and shared that information with RH after she resigned from Arhaus. The suit seeks to change Chi’s role to a non-conflicting one at RH, the return of all confidential materials, monetary damages (actual and punitive), attorney’s fees and court costs, and a third-party forensic audit of RH’s systems.
In the complaint, Arhaus outlined eight causes of action: misappropriation of trade secrets against all defendants; common law misappropriation of trade secrets and confidential information, pled in the alternative against all defendants; breach of confidentiality against Chi; unfair business practices against all defendants; common law unfair competition against all defendants; violation of Labor Code 2860 against Chi; violation of Defend Trade Secrets Act against all defendants; and intentional interference with prospective economic advantage against all defendants.
Chi, who rejoined RH as president, co-chief merchandising and creative officer in May, previously served as Arhaus’ chief merchandising officer from July 2021 until she left for RH. During that time, Arhaus alleges that she was given personal email access to Google Docs and either received or forwarded numerous documents from her Arhaus email address to that same personal account. Among the items the company alleges received this treatment were sales forecasts, strategic plans, marketing material, vendor issues and a draft of the Fall 2025 Catalog.
Arhaus claims that she shared the materials with RH executives and used them to shape product and marketing strategies in her new role and that RH allegedly began producing products and catalogs resembling those of Arhaus. It alleges that these actions violate a confidentiality agreement Chi signed in 2022, which includes explicit terms about non-disclosure, handling of data and post-employment restrictions.
Furniture Today has reached out to Arhaus and RH for comment.
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