Merrill Fires Back at Dynasty’s ‘Highly Personal Attacks’ in OpenArc Dispute

The procedural bickering persists in the battle between brokerage giant Merrill Lynch and Dynasty Financial Partners over a raiding claim tied to the high-profile breakaway of OpenArc Corporate Advisory. In a brief filed in federal court in Atlanta on Thursday, Merrill again asked the judge to either lift or partially lift a stay for its case against Dynasty, or alternatively to compel Dynasty to participate in a pending Financial Industry Regulatory Authority arbitration. Merrill claimed that the St. Petersburg, Florida-based RIA backer and service provider had effectively consented to arbitrate during an earlier hearing, an allegation Dynasty has denied. Merrill said Dynasty’s filing in opposition represented “vituperative and highly personal attacks disguised as arguments [that] cannot withstand scrutiny.” Dynasty has shown a “lack of transparency and candor” that has allowed the dispute over forum selection and discovery to drag on, the brief said. “Dynasty continues to obfuscate, presenting the decision whether to maintain or lift the stay as a binary choice. It is not,” Merrill’s lawyers wrote. “The Court may use its broad discretion to fashion a practical, flexible solution that promotes efficiency, avoids duplication, and preserves the parties’ rights.” The Merrill lawyers included in the brief a half-page flow chart with more than 20 boxes. It presented multiple options for the court, including lifting its stay on all claims, lifting some claims, only allowing discovery, or maintaining the stay as Dynasty seeks. Last month, Dynasty had pushed back after Merrill first claimed it had “reneged” on its agreement to arbitrate the raiding claim. Its lawyers denied agreeing to arbitration and said it cannot be compelled to participate because it is not a Finra member. “Merrill once again offers no support that there was ever an agreement by Dynasty to arbitrate and simply provides a nonsensical ‘flowchart’ that in substance merely confirms Merrill suffers no prejudice from the stay,” a Dynasty spokesperson stated. Merrill relies on “material misstatements of the record—including the Court’s own words,” the spokesperson added. The wirehouse had reiterated in Thursday’s filing that the court was also under the impression that Dynasty had consented to arbitration when it stayed the case in October. It quoted the judge as saying, “You all seem to agree you’re going to Finra.” Dynasty “remained silent” rather than clarify its position, and it is “well settled that a party’s silence in open court can be construed as counsel’s acquiescence to a course of action,” Merrill’s lawyers wrote. Merrill’s brief also tweaked Dynasty for failing to abide by court rules because it filed its opposition brief in the wrong font size and then improperly refiled it without noting it had been amended. The court stayed the litigation after it denied Merrill’s motion for a temporary restraining order against the defectors. Merrill sued Dynasty, Charles Schwab and the OpenArc breakaway team’s leaders in September accusing them of orchestrating a “corporate raid.” They had taken most of the 90 advisors on the team, which provided retirement benefits, equity compensation plan advice and investment management for around $129 billion in client assets. The wirehouse filed its lawsuit hours after the team left. The breakaway group denied the allegations and said that Merrill had acted disingenuously by seeking to retain them while simultaneously planning to sue them once they left. The team has transferred around $10 billion in assets from Merrill, Dynasty announced on Friday. When you say “Merrill Lynch”, i think what you mean to say is “Bank of America”. The Bull was castrated over a decade ago. Thanks Stan. Ok, 6 months after 90 people leave they’ve landed $10B of their former $129B? Is it just me or is Merrill whining about less than 10% having followed? $10 billion transferred? Why do all the articles reference $129 billion? If $10 billion is accurate it appears ML has already won. What are the real facts? Ouch 10 Bil… that’s not even 10% of assets. Less than 8% of clients moved? Looks like they have more “ Managing Directors” at their firm than clients If I recall correctly, a big portion of the 129B is wrapped up in 401k and stock benefit programs, so I would imagine that there are windows on when the companies would consider moving over. Probably with RFP procedures. The 129B was always misleading – it isn’t, and never has been – all wealth management assets. TWhen paying atten to the team details, the 129 covered the whole chain from work compensation to assets moved into retirement and personal wealth plans. I have been wondering how the transition with this new firm has been going and it does not sound great. If the $129 billion in assets was never in play then why did they put it in all the headlines? Surely they knew at some point, it would come out that a large majority of it would still be at Merrill. The splashy headline is not great when six months later $119 billions still at Merrill Lynch. Hope this lawsuit is still worth it. It’s 16B individual and 113B in the plans. The big 5 plans have had 3 already commit and who knows on the other 2 but we all got so fat off the redistribution ask me if we care. When said and done they will have 60% of that book and rest up for grabs everywhere. Those cats leaving was biggest boost to my career and paycheck in 27 years here! I’m sending one a bottle of Johnny blue on his birthday Appreciate the honesty. Go get your share. The reality is setting in. The “129 Billion $” team down to 10B split amongst 70 advisors. RIA=Independence? Not with these “leaders”- check your clients ADV, it’s the company not the advisor listed. And that contract you signed after you resigned? Sit back and wait for grid reduction. $10 B divided by 70 Advisors equates to $143 M per Advisor. Sounds like an average RIA shop. It’s not 70. Is more like 43ish at last count. Merrill is a mess and will always be a mess until they clean sweep the c suite. Bunch of empty suit MAGA loyalists with no idea how to run a business. Hate to say they are outmatched by the bank side execs but they are and it’s clear as day. Least there are 2 to share the blame. It’s never been this bad in my 16 years here as far as I can remember. Those two won’t both make it to the end of the year it seems and this team is a monster of Merrill’s own making. They need to own the fed the beast until it ate them. What about everyone they worked over for this team to just leave them? And you want loyalty from us? Puh leaze Brother, you need a new job. I’m sure openarc will take you. It’s 70 and 1 advisor has $3B of the assets, 69 sheep feeding off of the balance. A ‘Svengali’ is more than just someone who is manipulative. It’s somebody who makes you think you need them in order to accomplish anything.