What You Have to Know
- The advisor alleges that firm insurance policies degraded his skill to serve purchasers.
- One provision bars him from contacting previous, current and potential purchasers for 2 years post-employment.
- Felix Kwan additionally alleges that the agency breached his employment settlement.
A just lately resigned Edelman Monetary Engines advisor has filed swimsuit in opposition to the agency and associated entities, difficult the non-solicitation provisions in his worker contract as unenforceable.
The lawsuit, filed earlier in August in California Superior Courtroom for Contra Costa County, additionally touches on shifts in custodial preparations following Charles Schwab’s TD Ameritrade acquisition.
Felix Kwan began working at Edelman as an affiliate director, monetary planning, in April 2012, and entered into an employment settlement with a non-solicitation provision, in keeping with the grievance, which seeks a jury trial.
Barred from Soliciting Shoppers
The availability, amongst different factors, purportedly prohibits Kwan from initiating contact with previous, present or potential purchasers to induce them to go away the agency for 2 years following the top of his employment, and from accepting enterprise from purchasers throughout that interval, the swimsuit says.
The employment contract’s non-solicitation provision just isn’t enforceable underneath California legal guidelines banning non-compete and non-solicitation provisions, Kwan asserts.
“It’s effectively established underneath these legal guidelines that, within the state of California, non-solicitation provisions that aren’t restricted solely to the safety of commerce secret info are void and unenforceable,” the grievance asserts.
In January 2016, Kwan and Edelman entered right into a “contribution settlement” that additionally incorporates unenforceable non-solicitation provisions, the grievance alleges.
These provisions purportedly prohibit Kwan from soliciting any purchasers who obtained providers from anybody inside Edelman or its subsidiaries for 15 months after his employment ends, the swimsuit says. In addition they bar him from accepting any enterprise of the identical or comparable nature from any shopper who obtained providers from anybody inside Edelman even when the shopper wasn’t solicited, the grievance states.
Concern Over Consumer Service
Kwan, who alleges that Edelman took a number of steps to degrade his skill to serve his purchasers, resigned Aug. 2, notified his purchasers and rapidly filed the lawsuit to acquire a judicial willpower on whether or not the restrictive covenants within the agreements are enforceable and whether or not Edelman can prohibit him from accepting enterprise from former purchasers.
He was government director, monetary planning, when he resigned, in keeping with his LinkedIn profile.
Kwan seeks a court docket order enjoining Edelman from making an attempt to implement the non-solicitation covenants, in addition to compensatory damages and a declaration that the non-solicitation provisions quantity to unenforceable non-compete guidelines and due to this fact are void and unenforceable underneath state legislation.
Kwan’s LinkedIn profile signifies he began work this month as a companion and managing director at Prime Capital Monetary.
Kwan alleges that Edelman failed to offer obligatory sources to correctly serve purchasers and outlined a number of steps he contends that the corporate took, beginning with an unexplained 4% complete compensation reduce in 2019 or 2020.
Kwan was supported by a shopper service affiliate, or CSA, with the initials D.T., whom the swimsuit describes as “an essential a part of Mr. Kwan’s crew” and important to “sustaining a excessive degree of customer support and satisfaction.”