Former Stockton Mortgage Employees Deny Trade Secret Allegations

Eighteen former Stockton Mortgage Corp. employees have denied allegations of misappropriating trade secrets and interfering with the company's business after joining competitor Novus Home Mortgage. The defendants filed their responses on Monday in the U.S. District Court for the Northern District of Alabama, addressing a third amended complaint from Stockton Mortgage filed on June 22. Stockton Mortgage's original suit, filed in October 2025, accused the former employees and Novus of orchestrating a mass departure and violating nonsolicitation and confidentiality agreements. The company alleged a "nefarious conspiracy" and a "months-long covert scheme" to divert borrowers to Novus, claiming intellectual property and confidential borrower data were stolen, leading to tortious interference with business relationships.

In their July 6 filings, the defendants acknowledged resigning from Stockton Mortgage and subsequently accepting employment with Novus in similar roles. However, they explicitly denied engaging in any wrongdoing, including claims of breach of fiduciary duty, tortious interference, and civil conspiracy. The defendants also refuted allegations of improperly interfering with Stockton Mortgage's business relationships or expectancies and disputed the company's claims for damages. Novus Home Mortgage also denied any wrongdoing.

The defendants' filings contend that Stockton Mortgage has failed to present valid legal claims, has not suffered any compensable damages, and has not adequately identified any protectable trade secrets. Furthermore, the defendants denied using or disclosing any trade secrets belonging to Stockton Mortgage, asserting that any information they possessed was not proprietary. The court filings represent a significant legal challenge to Stockton Mortgage's accusations, with both sides presenting starkly contrasting narratives regarding the circumstances of the employees' departures and subsequent employment.