Ameriprise Financial Services' ongoing legal battle against LPL Financial recruiting its advisors took a twist this week.
On Monday a federal judge in Seattle granted a restraining order to Ameriprise in a case involving financial advisors leaving the firm, while a federal judge in Phoenix ruled against Ameriprise in a separate matter.
Ameriprise has targeted LPL in at least four complaints sinch January 2024, alleging its competitor had unfairly hired its financial advisors. It’s a string of cases of two industry giants fighting for financial advisors at a time when the entire wealth management industry is in flux. LPL works with 29,000 financial advisors and Ameriprise 11,000. The latter's financial advisors, however, historically have produced more annual revenue than those at LPL.
For decades, big firms like Ameriprise and LPL Financial have used litigation as an attempt to hold onto clients and deter competitors from hiring or recruiting financial advisors.
The rash of lawsuits got so bad that, 20 years ago, a handful of large firms created the “protocol for broker recruiting” to establish guidelines under which a financial advisor leaves one firm and works at another, walking out the door with a limited, reasonable amount of their clients’ information: client name, address, phone number, email address, and account title.
Regardless, Ameriprise has been taking LPL to court recently. Both firms are members of the industry protocol for recruiting.
In Seattle, Barbara J. Rothstein granted Ameriprise’s temporary restraining order against financial advisor Douglas Kenoyer, who in September left the firm to move to LPL. Both are required to return all Amerprise’s “confidential, proprietary, and trade secret information” in three days, according to the ruling.
Meanwhile in Phoenix, Susan M. Brnovich denied Ameriprise’s motion for a temporary restraining order against a group of advisors, led by Jared Roskelley, who resigned in January and started working at LPL. “Ameriprise fails to establish that its clients’ information is actually a trade secret,” the ruling read.
Both cases may continue in arbitration held by Finra Dispute Resolution Services.
“While LPL may be content to expose advisors to the significant risks involved in such egregious violations, Ameriprise is committed to protecting its clients’ confidential information and supporting the efforts of our advisors and recruits to do the same,” an Ameriprise spokesperson wrote in an email when asked about the Kenoyer decision.
Regarding the Roskelly decision the Ameriprise spokesperson added: “We look forward to presenting the overwhelming evidence to a panel of experienced Finra arbitrators.”
An LPL spokesperson wrote in an email that the company was “thrilled with the Arizona federal court’s decision to deny Ameriprise’s request for TRO in its entirety.”
“It is evident from the ruling that the court saw through the baseless claims brought by Ameriprise and that their attempts to strip independence from advisors by claiming ownership of their books were denied,” the spokesperson stated.
By listening for what truly matters and where clients want to make a difference, advisors can avoid politics and help build more personal strategies.
JPMorgan and RBC have also welcomed ex-UBS advisors in Texas, while Steward Partners and SpirePoint make new additions in the Sun Belt.
Counsel representing Lisa Cook argued the president's pattern of publicly blasting the Fed calls the foundation for her firing into question.
The two firms violated the Advisers Act and Reg BI by making misleading statements and failing to disclose conflicts to retail and retirement plan investors, according to the regulator.
Elsewhere, two breakaway teams from Morgan Stanley and Merrill unite to form a $2 billion RIA, while a Texas-based independent merges with a Bay Area advisory practice.
Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.
Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.
