Intelligence firm targeted our staff, West Face says in court filings

A Toronto-based private equity firm is alleging that its employees were targeted in a covert corporate espionage operation involving an agency with operations in London, Paris and Tel Aviv staffed by former members of the Israeli Defence Force and former agents of intelligence agency Mossad.

The agency cited in court documents filed by West Face Capital Inc. is Black Cube, the same one reportedly retained on behalf of former Hollywood mogul Harvey Weinstein to investigate women who had accused him of sexual misconduct.

West Face filed the court documents Wednesday in connection with a legal action brought by rival Catalyst Capital Group Inc. last week. Catalyst accused West Face and others of acting as “conspirators” in a short-selling campaign.

None of the allegations have been proven in court.

In a statement last week, West Face said the firm and principal Gregory Boland “deny strenuously every allegation made against them.”

In the days following the filing of Catalyst’s statement of claim against West Face — the fourth legal action it has commenced against the firm since 2014 — West Face became aware that employees, former employees, and even the wife of a former employee, were targeted by Black Cube “operatives,” according to the motion record filed Wednesday by West Face.

Some, including the former general counsel of West Face, were wined and dined, and flown to England on the false pretence that they were being courted for employment with international companies, the court documents allege.

The allegations and affidavits sworn by the affected employees say they only realized what had happened when they saw photographs in published articles about the Weinstein scandal of an alleged Black Cube agent identified as former Israeli actress Stella Penn, who also goes by Stella Penn Pechanac.

In an affidavit, West Face’s former general counsel Alexander Singh says he was questioned about issues that are contentious between West Face and Catalyst, including litigation over an employee, Brandon Moyse, who had left Catalyst to work at West Face in 2014. According to the court filing, Moyse, who subsequently left West Face, was also allegedly approached by a Black Cube agent.

In an affidavit filed in the court documents, Moyse says he realized in hindsight that he and his wife had been contacted by a woman identified in photos and surveillance video published by the media as a Black Cube operative about a week before Catalyst adjourned the appeal of a lawsuit involving him “on the basis of new information that it had discovered.”

“While I cannot be certain, I believe that Catalyst or its agents retained Black Cube to attempt to gather information from me that would be relevant to the litigation is has commenced against me and other parties, including the appeal,” Moyse says in the affidavit.

Catalyst was not available to comment on Wednesday.

In the court filing, West Face seeks to compel Black Cube, Catalyst, and others, including law firms retained by Catalyst, to “take immediate steps to preserve all evidence in any way related to, arising out of, or referring to investigative activities undertaken against or involving … West Face and its current or former employees or agents.”

West Face is also seeking to transfer the latest court wrangle with Catalyst to the Commercial List, which deals with corporate cases.

A request for comment from Black Cube on Wednesday’s court filing was referred to a public relations officer in Israel.

The court documents filed by West Face Wednesday say different approaches were used for each employee or former employee approached, but that there were common elements, including “using false businesses, websites, identities, LinkedIn profiles, and business cards.”

The targets were flown to London with meetings set up “while they were jet lagged, tired and less guarded than they otherwise would have been,” the court documents allege. The filings say the current and former West Face employees were encouraged to consume alcohol at the meetings, whose locations were often changed at the last minute “as a counter-surveillance measure.”

Though it is not unusual for corporations and law firms to hire outside companies to conduct certain types of investigations, the court documents filed by West Face claim Black Cube is not licensed to act as a private investigator in Ontario. The filing alleges that Black Cube acted “unlawfully and illegally in its dealings with current and former employees of West Face.”

The Wall Street Journal reported that Black Cube, in a statement, said the firm “applies high moral standards to its work, and operates in fully compliance with the law of any jurisdiction in which it operates — strictly following the guidance and legal opinions provided by leading law firms from around the world.”