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June 19, 2015

DHR International and CTPartners shared track record of discrimination

Update June 19, 2015: added updated information on revised complaint against CTPartners

DHR International and its acquisition target CTPartners have a lot in common including track records of alleged discrimination.

former Principal in DHR's Silicon Valley office, is suing DHR International for discrimination. According to her suit, she alleges she "performed her services for DHR in an exemplary manner" however Pravesh Mehra (global leader of the Business & Professional Services Practice) "stopped working with [her] and told her that she would have a hard time in the consulting market because she was a Caucasian female without an MBA". This is the second gender discrimination complaint in the same small Silicon Valley office.

CTPartners sexual discrimination has become a cause célèbre. According to an article in the New York Post:
"[CEO Brian] Sullivan, who stepped down amid the scandal, also subjected his employees to lewd behavior, including stripping naked at a boozy company event in 2012, workers alleged in the complaint filed with the EEOC.
In the amended shareholder complaint, five former employees describe a den of discrimination where men did little work and saw few consequences, while women were let go when the company didn't want to pay them.
One former employee claims that top executives would muscle into women’s assignments in order to get a portion of the finder’s fee even if they did no work.
An unnamed male managing partner would read the newspaper during client calls and disparaged a woman to a client while they were both on a call — and still he got a 65 percent cut of the fee, according to the complaint.
When the woman complained to human resources, she was told, “It’s going to be wasting your breath if you talk to Brian [Sullivan] about it,” the suit said.
Another former employee claims she was the 13th woman over the age of 40 to be let go in 18 months. Men who hadn’t made billings in three years stayed on the company’s dole while women who brought in $500,000 were let go without the pay they had earned, according to the suit."
Boards and management are and should be focussed on diversity. Diversity should be a critical consideration of every board search and executive search.

However, at DHR International, "Diversity" is not a value but a separate Practice Group, like "Sports" or "Financial Services". See the DHR web site, which says DHR "treat diversity assignments with the same level of professionalism that characterizes all of [their] work." Diversity assignments are a different class of assignment to DHR's other assignments.

In other words, for DHR diversity is a marketing tool. Over the last few years, DHR has had a number of "Heads of Diversity" but they don't tend to last long. Recent Global Heads of Diversity at DHR include Dwain Celistan and Ted Gregory, Carolyn Oakly Lowe and Susan Medina - three out of four left the firm. Diversity should be about attracting and retaining diverse talent.

There are currently seven members of DHR International's "Diversity Practice". Only one is female!

Another example of DHR's lack of understanding of diversity is the "roster" of six new directors they are proposing for election to the Board of Directors of CTPartners. See the DHR International press release, timed to coincide with the resignation of CTPartners CEO, Brian Sullivan.

In 2015 in the US, any half-decent search firm would ensure that a "roster" of Board of Director candidates has a diversity of gender, race, age, religion, ethnicity, sexuality, etc. If DHR International are truly "international" and global, then they should also be thinking about foreigners.

Guess what? The DHR International "roster" are six white male Americans. The ages include 75, 72 and 67. In fact, three of the six are called "William"! That ain't diversity.

The six are William Perez, William Farley, William Smithburg, John Jastrem, Daniel Connors and Geoffrey Hoffmann.

The lack of gender diversity of this "slate" is particularly an issue given the continuing sexual discrimination claims made against CTPartners. At least their Board currently has one female: Betsy Morgan.

At the end of the press release, David Hoffmann is quoted as saying, "We are confident our slate will be welcomed by the Board of Directors. The collective expertise of our board nominees will help drive maximum value for shareholders while fostering an employee centric environment.” Really? If DHR International truly cared about CTPartners' employees given the claims of sexual discrimination and "boys club", DHR International's "slate" would include some diversity. Instead, DHR International are pushing a "boys club" of their own. And, as at least one lawsuit suggests, DHR itself is being accused of discrimination against women.

Given some of the allegations of discriminatory behavior at DHR, CTPartners will be a great cultural fit. The CTPartners boys club will do fine in the DHR locker room.

June 17, 2015

DHR International sued by West Coast Managing Director, Adam Charlson

Update June 17, 2015: according to a lawsuit with their insurer, DHR have settled with Charlson.

Former West Coast MD, Adam Charlson, files a summons against DHR International, Geoff Hoffmann, Doug Black and Carol Hartman. 

We know from DHR's lawsuits against their insurer that they settled with Charlson. DHR only settle when they know they won't win. They have deep pockets and will happily outspend any plaintiff if they think they might win.

Please scroll as there are multiple documents to review.

June 14, 2015

Hoffmannitis: "embellishing" one's resume

A syndrome where one embellishes one's resume while simultaneously pointing out others doing the same, saying "There is no room for embellishment" even if  "The consequences are unbelievably significant" and “As tempting as those things are to do, it will always come back to haunt you”.
The quotes in this definition come directly from David H. Hoffmann himself in the Chicago Tribune.

Examples of Hoffmannitis include:
  1. David Hoffmann's own bio and LinkedIn profile, where he has claimed for many years to have been on Boards that he no longer (or possibly ever?) served on. See this post.
  2. David Hoffmann, DHR International and many employees claiming DHR International have "55 offices" or"more than 50 offices" when they really only have 42 - beyond all belief, even their website only lists 49, right under saying there are "more than 50 offices" See this post.
  3. DHR International and many DHR employees claiming DHR International are "ranked #1 in geographic coverage" when they are really only ranked #23See this post.
  4. David Hoffmann, DHR International and many DHR employees claiming DHR International are the "fifth largest executive search firm in the United States" or even "the world", pointing to a source (Executive Search Review) that doesn't support this and which is based on bogus data. See this post.
  5. DHR International and many DHR employees claiming DHR are "one of the fastest growing search firms" when DHR International have been shrinking. See this post.
  6. DHR and their consultants bulking up offices by lying about which offices they are in. See this post.
  7. DHR claiming they were established in 1989, when their own legal filings refer to 2001. See this post.
  8. DHR International on its letterhead claiming they operate in Africa, where they have no offices, and Australia, where they have "hidden" consultants who lie about their location as if they are based in Singapore. See this post.
  9. DHR International giving many employees highfalutin titles so that an inordinate number of consultants are "Leaders", "Chairmen", "Vice-Chairmen", "MDs", etc. See this post.
  10. David Hoffmann claiming a "roster" of prospective Board Directors is "Blue Chip" when some on the roster do not meet the definition. See this post.
The DHR leadership are audacious and brazen in their behavior and Hoffmanitis. Despite us pointing our the many lies they tell, they generally don't stop saying them. The one exception was then they removed David Hoffmann's profile from the web site of the firm he founded rather than correcting the lies.

Some might argue each lie on its own does not mean much, but when taken as a whole it is clear there is a pattern of behavior with an utter disregard for the truth.

And yet many DHR employees continue to spread the same lies e.g. claiming in their LinkedIn profiles or bios that they work for the fifth largest search firm in the world or saying DHR is ranked #1 in geographic coverage. It might have initially been OK for these employees to repeat these lies, but now they know these are lies, why don't they stop spreading them?

We expect there will be more examples of Hoffmannitis to add soon. Stay tuned!

CTPartners: staggering 22% of consultants depart avoiding DHR International

Update: June 14, 2015: most recent departures include Blayne O'Hara,  John Hawkins, Gregory Lovas, Leslie Cook, Marta Rubio Blanco, Travis Rivers, John Stefanek and Keith Macomber struck out as additional CTPartners departures - the total leavers is now 61 including 9 senior leaders in four months. 

In the four months since February 6, 2015 when DHR International made their unsolicited takeover bid for CTPartners, large numbers of CTPartners' big billers have left that firm. Could it be that these rainmakers did not like the idea of working for DHR International?

The following is a list of CTPartners consultants showing those that have left since DHR announced their unsolicited takeover bid. The firm was fairly stable until DHR International arrived on the list of shareholders.

It is an astonishing 61 departures, and there may still be more that we have not identified. It is a churn in just four months of 21.9% of the consulting team (or an unprecedented annualised churn of 65.6%).

The churn includes at least 8 Vice Chairmen and 1 Chairman, 2 of whom served as CEO or over 47% of CT's leadership team in just three months. (As an aside, talk about a lack of diversity: there is only 1 Vice Chairman at CTPartners out of 18 is female - this will make them a good fit for DHR given DHR's lip service to diversity.

All four CTPartners consultants that were previously at DHR International have left the firm, suggesting they would not want to work for DHR again. We believe there is now nobody at CTPartners who used to work for DHR.

The word in the executive search community is that most CTPartners consultants are out there talking to other employers. The huge number of departures in a short time indicates this too.

According to CTPartners' 10-Q for the quarter ended March 31, 2015, these departures have resulted in CTPartners breaching loan covenants as "the revenue initiated by departed consultants ... exceed[s] 10% of revenue for the past twelve months."

Feel free to continue to leave a comment or send us an email if you have any more information.

Adam J. Prager
Adam Kohn (Vice Chairman)
Aidan Kennedy
Adrian Chalkley
Adrian Choo
Alan MacDonald
Alan Yuan
Alex Bennett
Alex Eymieu
Alexandra Alberti
Alin Popescu
Aline Cata Preta
Amanda Newsom
Amanda Williams
Amy Shoukry
Ana Cláudia Reis
Ana Luiza Molina
Andrea Aragon Gosz
Andreas Venzke
Andrew Crawford
Andrew Duncan
Andrew Mann
Andrew Smith
Andrew Valentine
Andy Davies
Andy Talkington (Vice Chairman)
Anita Tancell
Anja Reifeneder-Köstlinger
Anne-Hermine Nicolas
Anne-Monika Dürk
Anthony Boutall
Arthur Vasconcellos
Axel de Schietere
Barbara Bodenhausen
Barbara Taylor
Barry Bregman (Vice Chairman)
Beau Yorke
Belinda Humphrey
Ben Erskine-Hill
Bernhard Kurka
Beth Clemens
Bhavana Dalal
Blayne O’Hara
Brian Ippolito
Brian Sullivan (Chairman & CEO)
Burke St. John (Vice Chairman)
Buster Houchins (Vice Chairman)
Cali Santa Maria
Carlos F. Cata
Caroline Golenko
Caroline Marshall
Catherine Fleuriot
Cayce Colley
Céline Combelas
Charles H. King (Vice Chairman)
Charles Rohaut
Chris Kao
Chris Wilson
Christopher Coe
Christopher Orr
Ciara Finegan-Taylor
Colin Simpson
Cristine Amess
Crystal Curfman (previously at DHR, and so not surprising she left)
Damian Tynan
Daniel Kaplan
David Burton
David Cowan
David Merwin
David Nocifora (CEO & Board Member)
Debbie Cozart
Deborah Whitehouse
Debra Germaine
Deirdre Kenny
(Name removed on request)
Dona E. Roche-Tarry
Eduardo Antunovic
Eduardo Taylor
Elaine MacDermot
Emillia Mohtar
Emma Burrows
Eric Price
Ernie Brittingham (Vice Chairman)
Evgeny Vassilev
Fabienne Delorme
Fleur Sandler
Florence Magne
George Cheung
Gerlinde Berger
Gerry Davis
Gert Stürzebecher
Gina Barge
Glenn M. Buggy
Greer Hopkins
Gregory Lovas
Guy Barnes
Hana Antošová
Hans Jorda
Hartmut Mueller
Hélène Krieff
Helga Long
Honor Pollok
Ian Smith
Ina Sood
J.J. Marshall
Jacqui Pinnell
James Aslaksen
James Bright
James DiFilippo (left for DHR)
James Twiston-Davies
Jan Schwartz
Jane Bargmann
Jason Johnson
Jean-Michel Beigbeder (Vice Chairman)
Jefferey DeFazio
Jennifer Conley Chapman
Jennifer Silver
Jeremy Lawson
Jeremy Robertson
Jeremy Zeman
Joe Karsay
Joe McCabe (Vice Chairman)
Johanna Fitz
John Barker
John Davitt
John Hawkins (Vice Chairman)
John J. Keller (Vice Chairman)
John Spencer (previously at DHR, and so not surprising he left)
John Stefanek
Jorge Caridad
Jules Orpin
Justin Abraham
Jutta Menzenbach
Karin Brandes
Karin Warwick-Thompson
Katalin Bereczky
Kate Harper
Kate Murphy
Kate Thorneloe
Kathleen B. Stack
Kathryn Yap
Keith Macomber
Keith Meyer (Vice Chairman)
Kelsey Landahl
Kenny Chen
Kevin C. McKeon
Kirsten Werner-Schaefer
Kris Geerds
Kristin Jonsson
Kristin Sheridan
Krisztina Kövesdi
Kyle Fernandez
Laura Esam
Laura Fogel
Lauren True
Laurence Vallaeys
Lauretta Desmedt Rudman
Laurie A. O'Shea (Vice Chairman)
Laurie Pearl
Les Stern
Leslie Cook
Léssel Della Manna
Lili Mao
Lilian Poilpot
Linda Chang
Loreto Pascual
Louisa Perry
Lourit E. Andrade
Lucie Shaw
Lucy Krell
Lynn Muirhead
Magdolna Link
Magui Castro
Manisha Deva
Manuelle Mounissens
Marc Quinton
Margaret Obenshain
Maria Alejandra Trujillo
Maria Fuema Schillio
Maria Mejia
Marianne Oger
Marine Lamy
Mark Chamberlen
Mark Dixon
Mark Mather
Mark Selvitelli
Marta Rubio Blanco
Martin Mendelsohn
Martin Nass
Martin Newman
Matthew Healey
Melissa Reed
Melody Cooper
Michael A. Matella
Michael Banks
Michael DeSimone (previously at DHR, and so not surprising he left)
Michael Gagliardi
Michael Galetto
Michel Deschapelles
Morten Nielsen
Muna Awwadova
Muriel Belda
Muriel Moreau
Natalie Borda
Natalie Stones
Nathaniel Hook
Nathaniel Stapleton
Neil Newman
Nestor D'Angelo
Nick Evans
Nicolas Giraud
Nicole Hopgood
Olga Rozehnalová
Ondřej Hlaváček
Oxana Brookes
Pablo Londoño
Pamela Santos
Patricia Gibin
Patrick Haberland
Paul Aldrich
Paul Ciancarelli 
Paul Groce
Peter Anselmo
Peter Malanik
Peter Metzger (Vice Chairman)
Philipp B. Sturm
Philippe Lambrechts
Raj Kapoor
Rebecca Abraham
Rebecca Forwood
Rebecca Glasman
Reinhard Kolvenbach
Richard Hollister
Richard Pooley
Rick Sklarin
Robert F. Gorog Jr 
Robert Murray
Robert Voth (Vice Chairman)
Robert Wilder
Ron Porter (Vice Chairman)
Royce J. Hauw
Rudolf Müller
Samantha Carey
Samuel Stylianou
Sarah Lim
Seth Steinberg
Shirley Sie Tho
Simon Monks
Solveig Romand
Sophie Thoral-Gouvernaire
Stefan Reichelt
Steve Blake
Stuart Smith
Susan Baldwin
Sylvain Dhenin (Vice Chairman and CEO)
Tanya Lau
Thais Lourenco
Thomas F. Moran (Vice Chairman)
Thomas Hölzchen
Tim Boerkoel
Tim Kemp
Tobias Rummeleit
Tom Case
Tom Koch
Tony Charles
Train Luo
Travis Rivers
Trish Shortell
Ulrich Seega
Ulrike Ischler
Umesh Ramakrishnan (Vice Chairman & Chief Innovation Officer)
Valérie Barthès
Victoria Hyde
Vince Saunders
Walid Hanna
William Foley
Yann Hadjadj
Ying Xin

June 1, 2015

DHR International Australia - the "racy departure"

Update June 1, 2015: added additional newspapers covering this story.

More information has come to light from the Australian media on DHR International and it status in Australia.

We've written before about DHR's current consultants in Australia (Ben Burrell, Margaret Dillon and  James Gathercole) being listed on the DHR web site as working in DHR International's Singapore office but really being in Melbourne or Sydney, Australia. We've written about potential consultants who were asked to join DHR International in Australia but were told by "shady" DHR leaders they would have to "pretend to be working out of Singapore".

Well, this article from the Sydney Morning Herald makes for some interesting reading. A similar article can found in other leading Australian newspapers such as the Age in Melbourne, Brisbane Times, Canberra Times and WA Today.

The article gives us some answers to what's been going on down under and explains that DHR:
  • withdrew $293,264 from DHR Australia's bank account in November 2012  and sent it offshore, presumably to Chicago
  • signed off on the financial statements that DHR Australia was solvent in March 2013
  • despite being solvent, claimed to go "belly-up" in Australia in 2013 so that it could fire the DHR Australian team less than a month later in April 2013 and then did not pay them their entitlements
  • removed equipment from the DHR Australian offices, including all the computers and legal records, and sent these to (presumably South) Korea - they "shut up shop so quickly and completely even staff peanut butter was taken"
  • transferred Australian clients to another DHR entity in Hong Kong, including a contract with a paint company called Wattyl
  • had a "racy departure" from Australia, and their creditors and liquidator are still chasing them
  • stripped the assets of the business and did a "phoenix job"
  • continue to operate in Australia, have Australian phone numbers but have "no living Australian corporate incarnation"
  • are completing assignments for Australian clients searching for Australian candidates for Australian-based roles, but operate out of the "tax haven of Singapore"
  • are relying on the Australian taxpayer to pay for employee entitlements: Kevin Kummer of DHR sent an email to Australian employees on April 20, 2013, saying: "As of April 2nd DH International ceased operations and terminated all employees. As such we want to make sure we take the correct legal steps to shut down the business to ensure all former employees are properly paid either by DH or by the Australian government scheme Fair Entitlements Guarantee". According to LinkedIn, Kevin Kummer worked for DHR between January 2012 and March 2014, leaving as "Vice President of Accounting & Finance"
The headline of this Sydney Morning Herald article is "DHR International leaves bill with Australian government". Given that the Hoffmann family claims to be worth $300 million and it appears that DHR International Australia had enough assets in Australia to pay its employees their entitlements, how can DHR International get away with sending all the assets to Chicago and Korea and foisting their obligations onto the Australian taxpayer?

Do the Australian IRS and SEC care about this? Do they care that DHR are still operating in Australia but have no corporation there? Are DHR paying taxes in Australia?

"In the case of the Chicago mob [DHR International], the staff might have been paid out, were it not for the transfer of the assets before the demise of DHI. Instead – and this is the broader angle – the Chicago mob is trying to rely on the Australian taxpayer to fund its employee entitlements."

As the Sydney Herald journalist puts it: "we call upon readers now to consider whether their taxpayer dollars should be deployed in this exercise of paying out employees of what is ultimately a large Chicago firm, which has already obliterated its obligations to the Australian Tax Office via an administration, but which is poised to arise phoenix-like from the ashes of its predecessor as one of the big players in the world of executive recruitment".

We note that the Australian journalist tried to get a comment from a (female) DHR executive: "Executives of this entity were contacted for comment but declined to speak. One hung up on your humble essayist but not before saying she could not talk because legal claims were afoot." Well, at least we know we should go looking for more lawsuits against DHR in Australia.

And what does this mean for CTPartners in Australia? When DHR International acquire CT, what will happen with their Australian operations (Melbourne, Perth and Sydney)? Will all of the team  of 16 consultants have to pretend to be in Singapore? Or will DHR's acquiring CTPartners allow DHR to operate "above board" in Australia again, avoiding the regulators, liquidator and lawsuits that are "afoot"?

Tip of the hat to the readers that sent us an email or comment alerting us to the original Australian news story. We suspect there's more information: if you are a former employee or creditor, please email us. You can use an anonymous email service if you like.