LPL Financial was this week slapped with a temporary restraining order for allegedly poaching clients of a former Ameriprise Financial father-son duo in Michigan who moved to LPL in April.
On Monday, a U.S. District Court judge issued the order preventing LPL from “soliciting, attempting to solicit, inducing to leave or attempting to induce to leave” any clients serviced by Mitchell R. McCann and Wesley McCann at Ameriprise.
The judge also blocked LPL from using or disclosing any confidential information it obtained pertaining to Ameriprise’s employees or clients.
“The facts of this case were clear. These advisors and LPL violated the protocol for broker recruiting, among other industry standards and rules. We’re pleased the judge agreed,” Ameriprise said in an email statement.
Ameriprise sought the restraining order and injunctive relief in June, when it accused LPL and the McCanns of breaching the “Protocol for Broker Recruiting,” which governs an advisor’s use of client information when they leave a firm. LPL and Ameriprise, the nation's two largest independent broker-dealers, are signatories.
The McCanns, who worked in the Bloomfield Hills, Mich., office of Ameriprise, resigned from the firm on April 22. The elder McCann had been with Ameriprise since 2014, and his son joined him in 2018. The firm accused the duo of gathering confidential information and soliciting clients before moving to LPL. Ameriprise said they were caught on camera entering its offices after hours and on weekends and walking off with boxes of confidential information.
The McCanns were later removed from the complaint after an agreement was reached with Ameriprise in a June 24 court hearing that barred them from soliciting former clients and ordered them to return information they were accused of taking from the firm.
Ameriprise was direct in its complaint that the McCanns were being influenced by LPL. “It appears that LPL has permitted Mitchell and Wesley to retain and use their Ameriprise confidential documents and information in violation of their contracts, applicable law and the Protocol. Upon information and belief, Ameriprise suspects this could be standard practice for LPL and will seek documents and information in discovery that will address same,” the complaint said.
LPL previously did not respond to an inquiry for comment.
In addition to the restraining order, Ameriprise had also sought a motion for preliminary injunction and an order permitting expedited discovery.
The judge denied the request for expedited discovery and scheduled a hearing on July 15 for both parties “to show cause why this order should not be converted to a preliminary injunction,” pending the outcome of an arbitration by the Financial Industry Regulatory Authority.
The restraining order was issued by Judge Brandy R. McMillion in the United States District Court for the Eastern District of Michigan.