Towry’s legal action against seven former Edward Jones advisers started yesterday in the High Court.
Towry is seeking £6m in damages from Raymond James and seven former Edward Jones advisers over what it calls unlawful poaching of a large section of its client base.
Towry is claiming the seven advisers breached non-solicitation clauses in their restricted covenants and solicited clients after declining to become Towry employees following the national IFA’s acquisition of Edward Jones for £1 in October 2009.
Towry says within a short period of time nearly 400 clients transferred investments worth over £33m, and their investment business from Towry EJ limited to Raymond James.
The seven advisers are made up of Barry William Prosser Bennett, Pieter Burger, James Scott Chandler, Wayne Alan Hayhurst, Thomas Mark Spain, Stuart Lee Hutton and Tracey Louise Simpson.
Towry counsel’s opening submission argues the defendants’ “wrongful conduct has caused very significant losses, amounting to nearly £6m, for which it seeks damages”.
Raymond James opening submission claims that Towry has no evidence of solicitation by the advisers in question and that “the defendants were simply followed by their clients”.
Counsel for the defence added that Towry’s claim for £5.8m “is a simply preposterous proposition that should never have been pleaded”.
The defence says Towry was only interested in its ability to churn client’s investable assets into its own discretionary find management proposition, the Independent Investment Management service, because it planned to “fatten itself up to have an IPO within two years of acquisition”.