It’s been more than two years since Dollar Tree bought Matthews-based Family Dollar, but legal drama has continued to dog the company.
In the latest legal twist, Dollar Tree alleges that a former Family Dollar employee stole propriety information about planned Family Dollar stores and shared it with her boyfriend, an executive at competitor Dollar Express. That company was sold to Tennessee-based Dollar General this year.
Dollar Express is the now-defunct chain started by private equity group Sycamore Partners when it bought more than 320 stores from Family Dollar in 2015. Federal regulators had required Family Dollar to sell the stores for antitrust reasons when it was acquired by Virginia-based Dollar Tree.
In its suit, Dollar Tree-owned Family Dollar says Pamela Frailey, a former senior manager in its real estate department, supplied a detailed Excel spreadsheet of proposed Family Dollar store openings, closings, relocations and expansions to Dollar Express executive Richard Siliakus, who “improperly and illegally used the document” in the course of his business.
A North Carolina court granted DollarTree/Family Dollar’s request for a temporary restraining order against Frailey after she submitted a sworn affidavit admitting to sharing confidential information.
“The judge’s order speaks for itself and we will pursue any and all remedies,” Dollar Tree spokesman Randy Guiler told the Observer in an email.
Sycamore Partners declined to comment.
Before Frailey left Family Dollar in October 2016, she retained the “new store schedule” – a violation of the employee handbook.
In her affidavit, Frailey admits to sharing a thumb drive containing the list with Siliakus, but she says she did not believe the information to be confidential. Frailey says that when she left Family Dollar, no one told her that any materials she had were confidential and should be returned.
Frailey and Siliakus, the suit alleges, have been romantically involved since they worked together at Family Dollar. Siliakus left Family Dollar in 2014, but Family Dollar discovered “hundreds of emails expressing the romantic nature of their relationship” during its investigation.
Siliakus left Dollar Express in July, according to his LinkedIn page. Siliakus could not be reached for comment. Frailey declined to comment.
Family Dollar said that it invests “considerable resources” in analyzing where to open new stores. A competitor with access to Family Dollar’s detailed expansion plans can use the information to compete unfairly, Family Dollar said in the lawsuit, filed this week in North Carolina state court.
“Confidential information concerning a company’s expansion plans, including proposed store opening locations and projected sales, is extremely valuable, especially in the highly competitive world of discount retailers,” the suit reads.
Family Dollar said it realized Frailey took the information while working on an ongoing case filed this summer, in which Dollar Tree alleges Dollar Express and Sycamore Partners siphoned off funds and failed to pay Dollar Tree more than $50 million for goods and services.