A trio of wealth management firms in the Kansas City area, including RIA giant Mariner Wealth Advisors, have agreed to create a $25.5 million fund to settle a class action lawsuit alleging that Mariner, Tortoise Capital, and American Century colluded to suppress the labor market for local advisors.
The proposed settlement agreement filed earlier this week in the US District Court for the District of Kansas will benefit employees who worked in non-executive roles at any of the three companies from 2012 to 2020. The fund is expected to cover about 5,000 individuals and entitles each class member to at least $50 with a gross per capita recovery of about $5,100. Tortoise Capital Advisors now operates as an SEC-registered fund manager that invests primarily in publicly traded companies in the energy and power infrastructure sectors. Mariner reportedly sold its majority stake in Tortoise in 2017 for $150 million.
Plaintiffs Jakob Tobler and Michelle McNitt are former Tortoise employees who claimed in the class action suit that the three firms had an illegal “no-poach agreement” by agreeing not to hire or recruit each other’s advisors, resulting in suppressed wages and limited opportunities for advancing employment. Mariner and American Century were found in a 2021 investigation from the Department of Justice to have violated US antitrust laws over its no-poach scheme. Per the new settlement agreement court filing, the defending firms “deny the conspiracy as alleged.”
Overland Park-based Mariner, a leading RIA aggregator with over $550 billion in AUM, had a previous ownership stake in Tortoise that it sold in 2017. Mariner declined to comment for this story after a request from InvestmentNews. American Century, a mutual fund giant founded in 1958 with over 1,400 employees and $270 billion in assets, sent the below written statement.
“Civil litigation commonly follows government enforcement actions, and with this class settlement, we are glad to be in the process of resolving this matter. American Century remains committed to fair and honest competition in compliance with all laws and regulations.”
Settlements to former employees will be proportionately based on the compensation they received at the firms from 2012 through 2020, with an individual payout cap of $250,000.
Chief executive Marty Bicknell is Mariner’s largest stakeholder, while the mega-RIA’s other minority investors include private equity firms Leonard Green & Partners and Penfund, as well as asset manager Neuberger Berman. Mariner is also in litigation with fellow mega-RIA Edelman Financial Engines over allegations of poaching clients and stealing trade secrets.
Chicago-based Mesirow Fiduciary Solutions adds flexPATH's plan-level outsourced fiduciary book, boosting its retirement market reach to $164 billion.
Also, Raymond James's employee advisor channel adds breakaways from Wells Fargo and Stifel, while UBS welcomes an ex-Morgan Stanley duo in Indiana.
It promised guaranteed principal and 10% monthly returns. The SEC says it invested nothing.
Ten years after entering the fee-based annuity market, MassMutual Ascend says nearly half its lifetime sales came in the past two years alone – but barriers remain among fee-only advisors.
Amplify, WealthReach, Zeplyn and Zocks have unveiled partnerships aimed at automating portfolio management, content creation, account opening, and client communication.
Northern Trust’s Ken Lassner shows advisors how to convert volatility into after-tax portfolio gains
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
