Gromwell has been embroiled in a legal battle with 24 Seven Inc., a competitor. Both specialize in providing full-time and temporary staffing to companies in the fashion industry. Both are also privately held firms with offices in New York, although 24 Seven also has a West Coast office and a London presence.
According to Stuart Kagel, a partner at 24 Seven, the dispute with Gromwell centered on theft of trade secrets and employment contract violations law. Search firm 24 Seven has won a $742,000 award against Gromwell from a state court, and is awaiting a decision on legal fees and punitive damages.
Gromwell lists assets and liabilities each of between $1 million and $100 million in documents filed with the bankruptcy court.
Gromwell also said it filed for bankruptcy court protection to bar 24 Seven from trying to seize assets to satisfy the court award.
Gromwell affiliates Gromwell LCC and Gromwell Staffing Inc also filed petitions in Manhattan seeking bankruptcy court protection.