JPMorgan Asks Court to Hold Morgan Stanley Broker in Contempt

JPMorgan Chase & Co. escalated its legal battle against an advisor on a $1.5 billion team that joined Morgan Stanley in May and alleged on Tuesday that he has continued to solicit former clients after a judge ordered him to stop. J.P. Morgan Securities, the bank’s broker dealer, filed in New York Supreme Court a memorandum requesting that Christopher J. Lee be held in contempt over allegations that he violated a temporary restraining order issued in June. JPMorgan alleged that Lee continued to solicit its clients to transfer their assets to Morgan Stanley despite the “clear and unambiguous terms of the TRO,” according to the memorandum. Lee allegedly sent unsolicited emails to six JPMorgan clients containing Morgan Stanley marketing content. JPMorgan alleged that roughly 180 additional clients with more than $375 million in assets have transferred to Morgan Stanley after the TRO was issued. Lee wrote in one email that the team moved to Morgan Stanley “after careful consideration…based on their technology and robust wealth management platform,” according to the memorandum. “As our clients’ financial lives have become increasingly complex, we felt it was important to align ourselves with a platform that offers expanded resources, broader capabilities, and additional specialized expertise,” Lee added. “I’ve attached some information on our Wealth Management Platform and its capabilities. Thanks and I’ll give you a call on Thursday.” James Heavey, a partner at Barton LLP in New York who said he has advised at least 20 JPMorgan advisors on their exits, said that contempt requests are unusual and could lead a court to impose severe penalties, including fines and other sanctions. The advisor must show that his emails were either requested by the former client or somehow exempt from the order. “They better have a good explanation for it,” Heavy said. “If these were unilateral decisions to send communications out, that would be problematic.” A spokesperson for Morgan Stanley declined to comment. Lee’s lawyer, Jonathan Thau of an eponymous firm in New York, did not immediately respond to a request for comment. Thau previously expressed his confidence that Lee and his partner, Joseph S. Minaudo, complied with their employment agreements when moving to Morgan Stanley. They had argued that J.P. Morgan’s allegations of client solicitation were baseless. “We trust the Court will see the facts similarly and dispense consequences accordingly,” J.P. Morgan Wealth Management spokesperson Pablo Rodriguez added in a statement. JPM have the lowest IQ management team in the street. Generally street guys who barely earned their GED and weaponize the courts to ruin any advisor that attempts to leave. The lesson here is if your an advisor at JP, please leave while you are still small. If you impact their AUM they will try to ruin you. TERRIBLE FIRM and NOT RESPECTED. Didn’t they lie to everyone during Covid and say no banks would ever pay a dividend again? Because he’s been crushing his transition and pulling meaningful assets, JPM has been told to double down even harder on the legal front. Tired old playbook to scare other defectors.