Fidelity sues former broker's RIA firm for misuse of trade secrets

Brokerage giant seeks damages from Grapevine, Tex., firm owned by Paul Michel

May 3, 2018 @ 4:01 pm

By InvestmentNews

Fidelity Brokerage Services has filed suit against Provident Financial Planning, a registered investment advisory firm owned by Paul Michel, a former broker in the firm's Southlake, Texas, office.

Fidelity charges that Provident is using proprietary and confidential information that Mr. Michel took with him when he left to start his firm, and that Mr. Michel breached his fiduciary duty to Fidelity.

In addition to seeking unspecified compensatory and punitive damages, Fidelity is asking a federal court in Fort Worth to have Provident return to Fidelity customer information Mr. Michel took with him before he resigned in December 2017.

By the time Mr. Michel left, "he had access to and had gained knowledge of confidential Fidelity information relating to approximately 350 households, representing in excess of $466 million in client assets under Fidelity management," the firm said in its court filing.

"As a result of Mr. Michel's wrongful conduct, Provident has received the benefit of approximately $25 million in wrongfully diverted assets," it added.

In March, Fidelity filed suit in Ohio against a former broker at its Covington, Ky., call center who left for an advisory firm.

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