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Details of Apache lawsuit against its former Egypt executive emerge

Posted: June 16, 2016 at 9:56 pm   /   by   /   comments (0)

apacheAccording to court documents obtained by Energy Egypt, former head of Apache’s Egypt operations, Mr. Tom Maher, allegedly arranged meetings between Apex CEO Roger Plank and the Egyptian Minister of Petroleum Tarek El-Molla, and between Plank and the United States Ambassador to Egypt, and downloaded more than 230,000 Apache files to as many as nine portable USB drives between February and May 2016.

According to these documents, Apache claims that these files are proprietary and trade-secret information, and were it to fall into a competitor’s hands, it could significantly injure Apache.

These files, according to a court statement made by a senior Apache executive in Egypt, include Apache’s 2016 Plan, 2016 Strategic Planning; 2016 Capital Outlook; CEO’s 2016 Reviews; 2016 Drilling Programs; 2016 Production Plans; resumes received by Apache; files on Apache’s bonus plans for expatriates; reports from Apache’s joint ventures; Apache expatriate compensation; cash flows; development operations; sensitive financial, drilling and strategic information; documents regarding Apache’s operations near Shell’s Obaiyed field; Apache’s historical management conferences; board meetings; analyst executive presentations; corporate correspondence; Apache’s Competitive Intelligence briefings; files of Apache concessions with EGPC and Apache’s joint ventures, including production and forecast reports created for EGPC, EGPC bidding information and concession maps, Apache joint-venture Qarun Petroleum Company’s prospects and leads, Apache joint-venture Khalda Petroleum Company’s acquisition reports, concession maps and exploration summaries; Apache’s expatriate employees and their performance reviews; Apache’s historical bid round assessments, yearly plans, concession information, joint venture reports, and strategic plans.

Apache Corp. sued its former head of Egypt operations in Texas court Tuesday, alleging he surreptitiously joined a startup intended to directly compete with the Houston-based energy company in Egypt and took hundreds of thousands of confidential documents with him.

In a Harris County petition, Apache alleges its internal investigation revealed Thomas M. Maher, the company’s former regional vice chairman and general manager of Egypt operations, had downloaded more than 230,000 documents onto at least nine USB storage devices and took them with him when he left Apache on May 9.

“As Apache soon discovered, Maher had engaged in a well-orchestrated plot to steal Apache’s trade secrets to set up a startup firm, Apex — aptly named because it is built with Apache’s ex-employees, and Apache’s confidential information,” the petition states, later noting that Apex CEO Roger Plank is a former Apache president.

A judge on Tuesday also signed an agreed temporary restraining order in the case, barring Apex and Maher from using any Apache electronic files or confidential trade secrets and ordering them to return all such data to their defense attorneys. A hearing on Apache’s request for a temporary injunction was set for June 20 at 1:30 p.m. in the county’s 55th Judicial District Court.

Tim Shelby of Ahmad Zavitsanos Anaipakos Alavi & Mensing PC, representing Apache, said he has never seen this level of downloading, calling it “fairly unprecedented.”

And in a statement about the lawsuit, Apache spokeswoman Castlen Kennedy said the company is “very concerned” with the actions Maher allegedly took before departing and takes the security of its proprietary information seriously.

According to the petition, Apache has operated oil and gas wells in Egypt since 1994 and as of last year was one of the largest acreage holders in the country’s western desert. Maher, from February 2013 until his May 2016 resignation, served as head of Egypt operations.

A key component to Apache’s success in the region has been the use of 3-D seismic surveys “that identify high-yield prospects across multiple formations,” according to the petition. In Maher’s position, he had near-unlimited access to this highly confidential information.

The types of information Maher allegedly took include the 3-D seismic surveys, documents related to Apache’s developed and undeveloped wells on Egyptian lands, and strategies for obtaining key concessions and contracts with the Egyptian government. Maher also allegedly knew of the company’s production plans and global financial strategy.

Apache’s internal investigation showed Maher had met with Apex executives as early as November 2015 and secured a job offer as early as December, according to the petition. He agreed to become Apex’s president and chief operating officer, the petition says, but hid that fact from Apache, feigning only that he wanted to transfer out of Egypt in the months leading up to his resignation.

Emails and other correspondence prove that Maher misused Apache resources — namely he had his assistant schedule a meeting between Apex executives and the Minister of Petroleum & Mineral Resources for the Arab Republic of Egypt, according to the petition. Apache says “the importance of this meeting cannot be overstated,” as the minister holds the final decision-making authority regarding oil and gas production in Egypt.

Maher scheduled another meeting later between Apex executives and the U.S. ambassador to Egypt, according to the petition. Counsel for Maher and Apex did not immediately respond Tuesday to requests for comment.

Apache is represented by John Zavitsanos, Timothy C. Shelby, Monica Uddin, Cameron Byrd of Ahmad Zavitsanos Anaipakos Alavi & Mensing PC and Ashish Mahendru of Mahendru PC. Maher and Apex are represented by Craig Smyser and Garland Murphy IV of Smyser Kaplan & Veselka LLP. The case is Apache Corp. v. Maher et al., case number 2016-34027, in the 55th Judicial District Court of Harris County, Texas.

(Source: Law360)

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