Advisor Team that Left Morgan Stanley Files Counterclaim Seeking to Prohibit Firm from Soliciting Clients

Posted on January 21st, 2021 at 3:33 PM
Advisor Team that Left Morgan Stanley Files Counterclaim Seeking to   Prohibit Firm from Soliciting Clients

From the Desk of Jim Eccleston at Eccleston Law LLC:

Last week in the Eccleston Law blog we discussed a lawsuit filed by Morgan Stanley against a team of Advisors led by Wade Martin. The Martin team left Morgan Stanley to join RBC Wealth Management-U.S. in October 2020. In its lawsuit, Morgan Stanley sought an injunction prohibiting the Martin team from soliciting clients that the team serviced while at Morgan Stanley.

The Martin team has now taken the offensive in its fight with Morgan Stanley by filing a counterclaim against the firm. As reported by AdvisorHub, the Martin team’s counterclaim requests that Morgan Stanley be prohibited from trying to retain certain clients the Martin team serviced while at Morgan Stanley. The counterclaim pertains to clients the Martin team brought to Morgan Stanley when they joined the firm in 2010. According to the counterclaim, those clients amount to approximately 80% of the clients the Martin team serviced while at Morgan Stanley.

The Martin team argues that Morgan Stanley agreed that those client relationships belonged to the Martin Team and that the firm would not solicit those clients in the event the Martin team left Morgan Stanley. The counterclaim alleged that, contrary to the agreement, Morgan Stanley had offered incentives, discounts, and other inducements in an effort to retain those clients.

Tags: eccleston, eccleston law, RBC Wealth Management, Morgan Stanley

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