Brokers Notch Mixed Results in TRO Battles with JPMorgan, Edward Jones
Two Ameriprise Financial brokers in Michigan and Virginia obtained mixed results in non-solicitation battles with their former employers this week.
A federal judge on Wednesday dissolved a temporary restraining order she had granted almost two weeks ago against Ryan Riley, a former JPMorgan Chase & Co. broker who joined Ameriprise in Lansing, Michigan, in July, according to a filing in U.S. District Court in Michigan’s Western District.
TROs are frequently decided based on one side’s filings and may be dissolved or extended as a preliminary injunction after a full hearing, according to lawyers. A federal judge in April this year overturned a restraining order he imposed against two brokers who left Regions Bank to work at Raymond James & Associates after finding that Regions had misrepresented evidence against the brokers.
In August last year, a federal judge in Oregon refused to extend a nonsolicit order he had imposed three weeks earlier against a former Morgan Stanley broker who joined UBS after finding that Morgan Stanley was unlikely to suffer “irreparable harm.”
A spokeswoman for JPMorgan declined to comment on the decision or whether it will continue to pursue its claims for a permanent injunction and damages in arbitration with the Financial Industry Regulatory Authority Inc.
In its initial filing on August 5, JPMorgan said that Riley, who was overseeing about $146 million in assets, made personal cell phone calls to numerous clients “aggressively” soliciting them to shift to Ameriprise in violation of his employment agreements.
Riley, who first registered as a broker in 2007 with A.G. Edwards & Sons and who joined Chase Investment Services in 2011, declined to comment.
In a separate ruling on Wednesday that went against the broker, Judge Glen E. Conrad in the Western District of Virginia in Roanoke granted Edward D. Jones & Co.’s bid for a temporary restraining order against Samuel “Ed” Clyburn, Jr.
The order blocks Clyburn, who worked for his entire ten-year brokerage career at Jones in Wytheville, to stop initiating “any contact or communication of any kind whatsoever for the purpose of inviting, encouraging, or requesting any Edward Jones client” to transfer their accounts to Ameriprise.
“Although Mr. Clyburn generally denies having solicited clients in violation of the Agreement, his declaration does not specifically address or refute these particular allegations contained in the sworn statements submitted by Edward Jones,” Judge Conrad wrote in a Memorandum of Opinion.
Neither Clyburn nor his lawyer Joshua F.P. Long returned calls for comment. An Ameriprise spokeswoman declined to comment on both cases.
The TRO order will remain in effect for 14 days unless the court finds good cause to extend the order for a similar period, Clyburn consents to a longer extension, or a decision is issued by a Finra arbitration panel, the order says.
Edward Jones sought the TRO and a preliminary injunction against the broker in late July, claiming that he took advantage of his work-from-home status and a move of his office earlier in the year to deceive some clients into visiting his Ameriprise office in a “bait and switch” move.
Clyburn, who had transferred $42 million dollars out of $70 million he was overseeing for clients at Jones as of August 13, asked at least three clients to move their accounts to Ameriprise and contacted another client more than once in order to “complete the paperwork necessary for her to switch firms,” according to the memorandum.
“Edward Jones is pleased the court issued the temporary restraining order prohibiting Mr. Clyburn from continuing to solicit Edward Jones clients and enforcing the terms of the employment agreement Mr. Clyburn agreed to when he joined the firm,” said a Jones spokesman. “We look forward to the opportunity to make this order permanent in the related arbitration before FINRA.”