The Towry High Court case against Raymond James and seven former Edward Jones advisers has been roundly dismissed by the presiding judge.
Mrs Justice Cox, who handed down the verdict at the Royal Courts of Justice in London today, criticised evidence submitted by Towry chief executive Andrew Fisher as “unnecessarily argumentative”.
During the five-week hearing last July, Towry alleged that the seven advisers broke non-solicitation clauses in their contract which prevented former employees from contacting clients for up to 12 months.
However, the defence argued clients were prompted to leave as the service offering from Towry was so different from that provided by Edward Jones. A total of 388 clients with assets totalling £33m went to Raymond James.
Towry argued the propositions were in fact “incredibly similar”, which the judge rejected.
In the judgment Mrs Justice Cox said: “Given the extent of the differences between the two propositions, Mr Fisher’s description in cross-examination of the two businesses in fact being ‘incredibly similar’ and his statement that ‘the differences in the two propositions, actually, other regulatory permissions were very very small’ were inconsistent with the evidence.
“It appeared to be unnecessarily argumentative and I did not find his evidence on the matter helpful.”
The judge went on to “reject without hesitation” the allegation that Raymond James had created a “false paper trail to conceal their complicity in the solicitation of clients from Edward Jones”.
She said there was no evidence to back up the claim that Raymond James had encouraged the advisers to breach their contract, or that they were reckless about whether the advisers breached their covenants or not.
The judgment said: “Far from being reckless, or closing their eyes to the obvious, the evidence demonstrates a high degree of awareness for the need for caution and the taking of a number of steps, after obtaining legal advice, designed to ensure that each defendant recognised the importance of compliance with the restrictive covenants and that each did in fact comply with them.”
Towry also alleged during the case that in three separate instances, advisers conspired with each other to breach their Edward Jones contracts.
In response, the judge said: “I reject, as entirely without foundation in this case, the allegation that the conduct of the individual defendants prior to leaving their employment with Towry was consistent with a ‘pre-existing plan’ to poach Towry’s clients.
“In my judgment the allegation of conspiracy as between the individual defendants, or some of them, was wholly unsustainable on the evidence in this case. I am therefore unsurprised by the closing submission that Towry no longer pursues a case against any individual defendant that they combined and conspired with any of the other individual defendants. Indeed I am surprised that such a case was pursued until the end of the trial.”