At Tuesday’s hearing in Boston federal court, DraftKings was seeking a preliminary injunction to block Hermalyn from working for Rubin. DraftKings also alleged that Hermalyn downloaded confidential corporate documents before leaving and tried to attract two of his former coworkers in violation of a non-solicitation agreement.
Hermalyn swore he had not taken any documents or solicited his former coworkers. It was the former senior vice president’s first personal appearance in the Boston lawsuit.
“I operated with extreme caution,” he said. Asked if he solicited his former coworkers, he replied: “Absolutely not.”
Hermalyn ran DraftKings’ program to keep its biggest gambling customers, famed athlete partners, and other corporate VIPs happy. But Rubin wooed him away after lawyers for Fanatics told Hermalyn he could escape the noncompete by moving to California, where such agreements are illegal, according to court documents.
During almost two hours of testimony, Hermalyn also maintained that his copying of internal DraftKings documents in the weeks before his departure was because he had been issued a new work laptop and was moving needed files from his old laptop. He also said he deleted files on the old laptop that were personal documents, like family photos.
“This was my personal computer,” he said. “I’ll never do this again in my career.”
The two former coworkers, Andrew Larracey and Hayden Metz, separately testified that Hermalyn offered them jobs at Fanatics during a series of phone calls starting on February 1, Hermalyn’s first day on his new job.
The pair said they called Hermalyn that afternoon from a conference room in Boston when they heard the news he had left for Fanatics. Hermalyn asked them to switch to a FaceTime video call and show him that no one else was in the room, Larracey said. Hermalyn said he didn’t remember the request and that it was “not something I would do.”
Larracey, currently director of VIP operations at DraftKings, discussed notes he had taken on his phone at the time of the alleged job offers from Hermalyn, including compensation packages.
“It was a big ask,” Larracey said, noting he and his family would have to move from Boston to Los Angeles to work for Fanatics. “I said it would have to be multiples of what I make today.”
Hermlayn’s alleged initial offer included salary, annual bonus, signing bonus, and equity in Fanatics worth a total of more than $3 million, as recorded in Larracey’s notes. An offer for Metz, who took over Hermalyn’s job running the VIP program at DraftKings, was worth more than $5 million.
Metz testified that he had to attend a dinner with DraftKings customers that night at Contessa, followed by a Celtics game against the Lakers. But after the game, he and Larracey discussed the offers and decided to ask Hermalyn if Fanatics could do better. Their calls stretched past 1 a.m. as Hermalyn offered richer packages, including $8 million for Metz, the latter testified.
Hermalyn said his former coworkers and close friends called him and asked about working at Fanatics without his encouragement.
Metz said he did not pursue the job offer. Larracey applied for the job Hermalyn offered and had a series of interviews on Sunday, February 4, with top Fanatics executives, but the company never formally offered him a job.
US District Judge Julia Kobick, who is overseeing the case, issued a temporary restraining order preventing Hermalyn from soliciting DraftKings employees or customers on Feb. 8.
Kobick did not indicate during the Tuesday hearing how she planned to rule on DraftKings’ request to block Hermalyn from working at Fanatics for one year.
Aaron Pressman can be reached at [email protected]. Follow him @ampressman.
