JPMorgan Goes After Ex-Broker for Taking Clients to Morgan Stanley

JPMorgan Securities has filed for a temporary restraining order and a preliminary injunction against a former broker who has solicited at least a dozen JPMorgan clients to move their accounts from JPMorgan to the broker’s new employer, Morgan Stanley.

The court filing asks to maintain the status quo pending resolution of an arbitration proceeding between JPMorgan and the broker, Susan VanSpybrook, that concurrently is being filed with FINRA Dispute Resolution.

The dispute arises out of VanSpybrook’s departure from JPMorgan on Oct. 17, and her subsequent affiliation with Morgan Stanley Smith Barney LLC, a direct competitor of JPMorgan.

JPMorgan filed the requests in the U.S. District Court for the Eastern District of Michigan.

At the time of her departure, VanSpybrook worked as a private client advisor in a bank branch office of JPMorgan Chase Bank N.A., an affiliate of JPMorgan, in Northville, Michigan.

“JPMorgan has learned that since leaving JPMorgan and joining Morgan Stanley, VanSpybrook has solicited at least a dozen JPMorgan clients to move their accounts from JPMorgan to her at her new firm,” the filing states.

Shortly after she resigned, VanSpybrook contacted JPMorgan clients, including calling clients on their personal cell phones, seeking to induce such clients to transfer their accounts from JPMorgan to her at Morgan Stanley, the filing states.

“The clients have informed JPMorgan that VanSpybrook’s communications have been more than simply announcing her change of employment, and that she is actively requesting meetings with the clients or otherwise seeking to induce them to do business with her at her new firm,” the filing states.

“At least twelve JPMorgan clients have informed JPMorgan that shortly after VanSpybrook resigned, she called them, often on clients’ personal cell phone numbers, and solicited their business, requested meetings with the clients or otherwise attempted to get them to transfer their accounts to her at her new firm,” according to the filing.

At the time she left JPMorgan, VanSpybrook serviced approximately 277 JPMorgan households with approximately $185 million in total assets under supervision, “virtually all of which were either pre existing JPMorgan clients at the time they were assigned to VanSpybrook, or were developed by her at JPMorgan with JPMorgan’s assistance,” the bank says.

VanSpybrook now seeks to improperly induce such JPMorgan clients to follow her to Morgan Stanley, the filing states, which “constitutes a breach of her employment agreements (which contain non solicitation and confidentiality provisions), and a violation of her common-law obligations to JPMorgan.”

During the course of her employment by JPMorgan, VanSpybrook had access to “highly confidential JPMorgan client files in addition to other financial information that is confidential and proprietary to JPMorgan,” the filing continues.

The confidential information that VanSpybrook “has taken or retained was entrusted to JPMorgan by its clients with the expectation that it would remain confidential and would not be disclosed to third parties,” the filing maintains.