Corporate Espionage Claims Target 401(k) Admin Startups

Corporate Espionage Allegations Surface in HR Tech Sector

A new claim of corporate espionage has arisen within the typically unremarkable realm of employee onboarding platforms and 401(k) administration.

Throughout the year, we have been tracking the escalating conflict between HR software companies Rippling and Deel, currently embroiled in litigation involving accusations of embedded agents and systematic data theft. Now, as initially reported by Axios, a second act unfolds: Human Interest and Guideline, both prominent 401(k) management firms, are facing each other in federal court with remarkably bold allegations.

Details of the Lawsuit

A quote from Human Interest’s lawsuit against Guideline, filed this month in Utah federal court, reveals the intensity of the situation: “We are going to tear apart HI. It’s going to be the easiest thing to do.”

This text message, dated January 29, was sent by Brandon Sterri to his brothers. The complaint states that Brandon and his brother Brian were still employed by Human Interest at the time, regularly accessing company resources with the understanding that access was “limited to authorized personnel” and that they were obligated “to protect confidential data.” Their brother, Eirik, was employed by Guideline.

The lawsuit alleges that the Sterri brothers didn’t merely discuss their plans. They reportedly operated a scheme they dubbed the “Sterri Takeover,” a moniker suggesting either excessive confidence or a misunderstanding of the discreet nature of corporate espionage.

According to the complaint, Brian and Brandon, working as junior inside sales representatives at Human Interest, systematically transferred their employer’s sensitive information – including partnership leads, customer data, and internal strategy documents – to Guideline.

This information wasn’t shared with just anyone at Guideline; Human Interest alleges the brothers were communicating directly with the company’s chief executive, Kevin Busque, and its chief financial officer, Steven Wu.

Guideline's Response

A Guideline spokesperson provided the following statement when contacted for comment: “Guideline believes allegations in this lawsuit are false and without merit. We are vigorously defending ourselves and we look forward to presenting the facts and showing that these claims are unfounded.”

TechCrunch’s request for comment from Human Interest received no response.

Evidence Presented in the Complaint

Human Interest’s complaint details an incident occurring two days after Brian Sterri’s resignation on February 24. He allegedly requested a screenshot from a former colleague, Castro, who remained employed at Human Interest: “Got a big favor to ask… A screenshot of total lead flow for ISR team this month.”

Castro responded, questioning the request: “Am i allowed to ask why.” Brian’s reply included a grinning emoji.

The requested screenshot, according to Human Interest, contained crucial information: total lead flow. This represents the core pool of potential clients and is vital for growth and market penetration. It is information cultivated over years and millions of dollars through proprietary processes and partnerships, and its misuse could create “a significant informational imbalance” and provide “considerable strategic advantage.”

Castro seemingly understood the implications of the request, responding: “I’m down to play dirty for sure but you need to get me a job lol.”

The lawsuit alleges Brian offered her employment at Guideline in exchange for the data. When Castro hesitated, Brian followed up the next morning: “I still need that favor.”

Castro reportedly refused, stating: “Brian you know I can’t do that.”

The complaint further alleges Brian continued his efforts, even involving his wife, McKenna, to contact Castro when she stopped responding.

Systematic Infiltration

Prior to their resignations, the brothers allegedly downloaded files labeled “Leads Data” and emailed them from their work accounts to personal Gmail addresses – Brian’s and his wife’s. By accessing personal email on company laptops, they bypassed Human Interest’s security measures.

On February 27, after Castro declined his request, Brian contacted another Human Interest employee, Chloe Garza, with whom the Sterris had a “close personal and/or familial relationship.” He requested internal metrics from a Slack channel, but Garza also refused: “Yea so I cannot send you anything HI related.”

Brian’s response, as documented in the complaint, is revealing. He allegedly wrote that “Mitch [another HI sales rep] would be the only person that could really give me the information GDL [Guideline] would want.” The complaint argues this admission is preserved in text.

Following an internal meeting at Human Interest to remind employees of their confidentiality obligations, Brian allegedly mocked the effort, texting Castro: “lol Horne using fear tactics lmao. Heard today scared a lot of people.”

Allegations of Executive Involvement

Human Interest contends that this wasn’t simply rogue employee behavior, but a coordinated operation with executive approval, potentially constituting racketeering.

After Human Interest sent cease-and-desist letters in early March, Eirik Sterri reportedly texted his brothers with an update from Andrew Conley, Guideline’s Senior Vice President of Sales: “Andrew is great. Also everyone has your backs for real. Everyone has expressed how fired up they are about the situation. It will blow over and all of us will be so fired up.”

Alleged Extortion Attempt

Human Interest claims Guideline attempted to extort them. Guideline is in the process of being acquired by Gusto, a $9.3 billion payroll company, in a deal reportedly valued at $600 million. As part of the acquisition, Guideline planned to sell off certain assets and accounts related to competing payroll companies. When Human Interest expressed interest in purchasing these assets, Guideline’s CFO allegedly threatened to halt the deal if the lawsuit wasn’t dropped.

Gusto confirmed the acquisition is still pending, stating that the “deal has not yet closed” and that “Gusto and Guideline remain separate companies.” They also emphasized their excitement about integrating payroll and 401(k) management services, while clarifying they are “not a party to the suit and have no involvement in the allegations.”

Broader Implications

The HR software industry is increasingly becoming a battleground for corporate competition, as evidenced by the allegations involving Rippling and Deel, including claims of planted spies and RICO violations.

This situation is serious for all parties involved: Rippling, Deel, Human Interest, the Sterri brothers, and Guideline’s executive team.

Financial Stakes

Human Interest has secured over $700 million in funding at a $1.4 billion valuation from investors including SoftBank, Baillie Gifford, and TPG. Guideline raised $340 million, achieving a $1.2 billion valuation in 2021 with support from General Atlantic and Felicis.

This story has been updated with comments from Gusto.