Movement’s ex-national sales director countersues for $13M over unpaid wages

Deran Pennington, a former Movement Mortgage top sales executive sued for poaching by the lender, filed a counterclaim alleging that Movement breached the contract by failing and refusing to pay his due compensation. In total, he asks for about $13 million. 

In July, HousingWire reported that Pennington and two other top sales executives – Matt Schoolfield and Chris Shelton – parted ways with Movement Mortgage to join Summit Funding, which led to a legal battle between the parties. 

Movement filed a lawsuit in a U.S. district court in North Carolina in early October, accusing its former executives and the competitor of misappropriation of trade secrets, data theft and improper solicitation, among other allegations. Later, the company filed another lawsuit against Todd Scrima, Summit founder, alleging corporate espionage. 

Pennington, who worked at Movement from 2008 to 2023, answered to the lawsuit filed in North Carolina denying most of Movement’s allegations. He was one of the company’s earliest employees. 

According to Pennington’s counterclaim, Movement made him co-national sales director in 2020. The company allegedly offered him a $250,000 salary and commissions equal to 2% of net profits for all sales without a cap. The commission payments were made on a monthly basis, two months in arrears.

However, late in the 2020 plan year, Casey Crawford, Movement’s CEO, allegedly told Pennington that his 2020 compensation would be capped because he was “on track to make over $7 million,” which was “too much money.”

“Pennington fully performed his duties as Movement’s co-national director of sales for the entirety of 2020, generating in excess of $390,000,000 in net profit for Movement,” the document states. However, “Movement underpaid Pennington by a total of at least $3,267,544.86, with the first failure of payment occurring on or about November 1, 2020,” it adds.

A spokesperson for Movement did not immediately reply to a request for comments. 

Beginning in January 2021, Movement offered Pennington a new position as executive vice president of recruiting and a fixed salary, which he accepted. 

According to the lawsuit, Pennington is entitled to recover the unpaid wages at $3.27 million and liquidated damages for the company’s breach of contract. He also claims he is entitled to recover three times the total amount, or $9.89 million, for Movement’s South Carolina Payment of Wages Act violations. Pennington demands a jury trial. 

Pennington’s attorneys did not immediately respond to a request for comments. 

Pennington denies most of the Movement’s allegations in its lawsuit, including that he “engaged in solicitation efforts of multiple Movement employees” and “actively conspired with Shelton and Schoolfield to facilitate their breach of restrictive covenants by acting as their mouthpiece.”

“Pennington admits only that he did solicit certain Movement employees as stated in his Answers to Interrogatories,” the counterclaim states. Movement claims about 50 employees left the company to join Summit 

Pennington also admits that in March 2023, he and Summit began conversing about potential employment with Summit, signing a confidentiality agreement. He continued to receive some compensation from Movement from March 7, 2023, to July 1, 2023, when he resigned to join Summit. He denies receiving upwards of $2 million in signing bonuses to join Summit.