Morgan Stanley Alleges That Team “Betrayed” Former Partner in Move to J.P. Morgan
From the Desk of Jim Eccleston at Eccleston Law:
A New York state judge is considering whether to grant Morgan Stanley’s request for a temporary restraining order (TRO), which would bar two advisors from soliciting former clients at their new firm.
Morgan Stanley filed a petition seeking the TRO in October 2020, only one week after Joseph Donnelly and Sean Donnelly joined J.P. Morgan. Morgan Stanley alleges that the two advisors violated their one-year non-solicitation agreements by urging former clients to move their business to J.P. Morgan. Additionally, Morgan Stanley alleges that the two advisors betrayed their former partner, Jonathan Rynsky, by falsifying client statements prior to the transition. The duo allegedly removed Rynsky’s name from account statements in “a transparent effort to have clients view them as the lead advisors entrusted with their assets who they should follow to J.P. Morgan”, according to Morgan Stanley.
Morgan Stanley further claims that the advisors replaced Rynsky’s name on account statements with Sean Donnelly’s name, even though Sean was the “most junior financial advisor” and had a “negligible role” in the partnership. The two advisors allegedly convinced 25 clients with at least $48 million in assets to transfer their business to J.P. Morgan, while the duo managed nearly $250 million in assets prior to their departure, according to the filing. The two advisors were allegedly incentivized to solicit their former clients because J.P. Morgan offered the duo a favorable recruiting deal, which included “several million dollars” upfront and another “several million dollars” if the advisors brought along a “certain amount of business”, according to Morgan Stanley.
Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, regulatory and disciplinary matters.
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