The ongoing skirmish between Bellevue, Washington-based financial advisor Lars Knudsen and independent wealth giant Hightower Advisors has taken another turn as Knudsen claims a number of legal wins.
The saga, which has drawn considerable attention, revolves around contractual breaches and defamation.
It began with a lawsuit Knudsen filed against Hightower in King County, Washington, on March 20, in which Knudsen claimed Hightower employed questionable tactics, such as illegal noncompete clauses and false allegations about him, in an effort to poach his clients.
In the weeks since, the two parties have engaged in a furious legal back-and-forth.
Immediately after Knudsen’s filing, Hightower launched its own suit against him in Illinois federal court, after which Knudsen filed to request a temporary restraining order against the firm. When that failed, he challenged Hightower’s motion to move the case to federal court, filing a motion to stay the Illinois action in favor of the action he launched in Washington.
So far, Knudsen’s camp has claimed victories on several fronts, including a Washington district court decision to remand the lawsuit back to the state level, a decision by the state court’s commissioner granting a temporary restraining order against Hightower, and a Washington state court judge's decision to quash a request from Hightower to hear a motion to dismiss the case on an expedited basis.
The state commissioner’s temporary restraining order against Hightower, handed down Tuesday, was sought by Knudsen – supported by more than a dozen sworn declarations from his clients – to halt what he described as a campaign of disinformation by Hightower along with Hightower Bellevue partners Dan Stober, Randy Williams-Gurian, Tara Johnson, and Sharon Lailey.
“The legal process can be complicated with a lot of moving parts, but we will continue to work with integrity and respect for the judicial system,” Andrew R. Escobar, a partner at Seyfarth Shaw who’s representing Knudsen, said in an emailed statement.
“While we hope for a quick resolution to this legal matter, these milestone victories keep us on a legal pathway we hope will lead to an amicable and swift conclusion that allows Lars to move forward serving his clients as he has for decades,” Escobar said.
“HighTower seems to think they can say anything, even the most egregious accusations, without any repercussions,” Knudsen said in the statement. “I have always been willing to reach a resolution and maybe these rulings will lead to a more productive discussion with HighTower executives and advisors.”
The case parallels another recent lawsuit against Hightower in California, where veteran advisor Darren Reinig said the firm was kneecapping his ability to build a new business with overreaching noncompete claims.
On America's 250th birthday, four advisors who left wirehouses and major banks reflect on conviction, technology freedom, and clients who celebrated their leap
Three advisors who left wirehouses and broker-dealers say the hardest part wasn't the client conversation — it was everything they didn't expect
CEO Ryan Parker says the program supports EP in the industry's "war for talent."
RIA platform Advisory Services Network is tapping into demand for advisors looking to jump from wirehouses and independent broker dealers
Masterworks was launched in 2017 but its RIA, Masterworks Advisers, is just three years old.
Dan Biagini of American Equity says the steady decline of pensions, longer lifespans and a reset in interest rates are rewriting how advisors build retirement income
Direct indexing is on pace to outgrow ETFs and mutual funds. Northern Trust's Ken Lassner explains why the advisors who get it wish they had started sooner.
