Capital One Sues BankUnited CEO John Kanas

Capital One Financial Corp. (COF) is taking its former head of banking, John Kanas, to court.

Kanas, now the chairman and chief executive of BankUnited Inc. (BKU), agreed not to compete with Capital One in the New York market when he left his former employer, according to disclosures from both companies. BankUnited agreed in June to buy Herald National Bank (HNB) of New York.

Capital One alleged in a suit filed Thursday in the U.S. District Court for the Eastern District of Virginia that Kanas violated the noncompete agreement, and asked the court to enforce it.

A spokeswoman for Capital One said, "We fully support legitimate competition in the banking industry, but we expect noncompete agreements negotiated in good faith to be honored in full."

Kanas couldn't immediately be reached for comment.

Kanas was chairman and chief executive of North Fork Bancorp., and was instrumental in selling the Melville, N.Y., bank in 2006 to Capital One. He initially stayed with his new employer.

Kanas subsequently left, and in 2008 started to pursue struggling BankUnited, which failed in 2009 and was bought from the Federal Deposit Insurance Corp. by a group of private-equity investors led by Kanas.

-By Matthias Rieker, Dow Jones Newswires; 212-416-2471; [e-mail]