Morgan Stanley Loses Temporary Restraining Order Aiming to Stop Former Investment Brokers from Soliciting Clients

Posted on March 27th, 2019 at 9:28 AM
Morgan Stanley Loses Temporary Restraining Order Aiming to Stop Former Investment Brokers from Soliciting Clients

From the Desk of Jim Eccleston at Eccleston Law LLC:

A Texas judge has denied a temporary restraining order (TRO) filed by Morgan Stanley to prevent two Dallas, Texas-based investment advisers, who left the firm, from soliciting their former clients at their new firm, an independent broker-dealer.

According to Morgan Stanley, the investment advisers, who had a $240 million-asset practice, breached their non-solicitation agreements by contacting at least four clients after leaving the firm. During the contact calls, the investment advisers offered their clients reduced-fees and made comments about not having to “push certain funds” now that they were with an independent firm.

In addition, Morgan Stanley alleged that the investment advisers violated their confidentiality agreement by printing out thousands of pages of client financial plans and accounts in the month prior to their resignation, and by working late into the night and on weekends in preparation for their departure.

Notably, although the judge denied Morgan Stanley’s request for a TRO, there will be a scheduled hearing on the firm’s request for an injunction in late April. Furthermore, Morgan Stanley also simultaneously filed an arbitration complaint with FINRA, seeking a permanent injunction and unspecified damages.

Cases such as this one, and many others, highlight the need for financial advisors to retain competent securities counsel to extensively plan their transition. While no transition is stress-free, it is crucial for financial advisors to be prepared to win the TRO fight. The attorneys at Eccleston Law assist advisors in planning their transition, negotiating their transition and employment agreements, and defending them when their former firms file litigation and arbitration.

The attorneys of Eccleston Law LLC represent investors and advisors nationwide in securities and employment matters. The securities lawyers at Eccleston Law also practice a variety of other areas of practice for financial investors and advisors including Securities FraudCompliance ProtectionBreach of Fiduciary DutyFINRA Matters, and much more. Our attorneys draw on a combined experience of nearly 65 years in delivering the highest quality legal services. If you are in need of legal services, contact us to schedule a one-on-one consultation today.

Related Attorneys: James J. Eccleston

Tags: james eccleston, eccleston law, eccleston law llc, eccleston, tro, texas, morgan stanley, finra

Return to Archive



Fantastic news!!!!  Your professionalism, support and expertise were greatly appreciated.  You made a difficult situation much more bearable.

Marci M.


May 17, 2024
Fidelity Advisor Files Lawsuit Alleging Wrongful Termination Over Whistleblowing

A former Fidelity Investments advisor, Michael Maeker, has initiated legal action against his former firm, alleging wrongful termination in response to his reporting of anti-investor sales tactics.

May 16, 2024
CFTC Investigates Banks for Potential Whistleblower Suppression

The Commodity Futures Trading Commission (CFTC) has initiated inquiries into several banks, including JPMorgan Chase, Bank of America, and Citigroup, regarding potentially hindering whistleblowers from disclosing information, as reported by Bloomberg News.


May 15, 2024
NFA Issues Order Against Investments LLC

The National Futures Association's (NFA) Business Conduct Committee (BCC) has taken action against Investments LLC, a former NFA Member commodity pool operator and forex firm, for violating multiple NFA compliance rules.