Federal Judge Restrains Former UBS Advisors Amid Solicitation Dispute with Elevation Point
From the desk of Jim Eccleston at Eccleston Law
A federal judge in Florida has approved a stipulated order restricting a $1.4 billion advisory team that left UBS Wealth Management USA for RIA Elevation Point from contacting certain clients. AdvisorHub reports that the order stems from UBS’s claim that the Loxahatchee Capital team breached inherited account agreements by soliciting clients to transfer their accounts to their new firm.
Judge Aileen M. Cannon of the U.S. District Court in West Palm Beach signed the agreed order, which allows the advisors to continue servicing clients who initiated unsolicited transfers or who already have moved their accounts. According to AdvisorHub, the order will remain in effect until a Financial Industry Regulatory Authority (FINRA) arbitration panel decides on UBS’s request for a permanent injunction.
Judge Cannon also directed the advisors to return all UBS confidential information within 72 hours and surrender any personal mobile phones used in their last two years at UBS to a third-party consultant for review.
A lawyer representing the advisors described the order as “a very balanced agreement that preserves both parties’ claims, positions, and arguments to be resolved in the underlying FINRA arbitration.”
UBS alleged in its complaint that the team (The 440 Group) had inherited clients from retired advisors under a one-year non-solicitation agreement. The firm claimed that those retirees were entitled to continued payments under UBS’s retirement program through 2028 and that the team’s alleged solicitation “is hurting” those retired advisors’ financial expectations. UBS asserted that Plum and Cullen began soliciting clients the day after resigning on September 19, with transfer requests totaling more than $200 million in assets.
Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, transition, regulatory, and disciplinary matters.
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