Client Testimonial – Richard Kopelman

 In Testimonials

In April of 2014, the financial services department of the firm that was then known as Habif Arogeti & Wynne and is now known as Aprio (“HAW”) was raided by brokerage behemoth Morgan Stanley Smith Barney.  HAW had written employment agreements with their financial advisors (“FAs”) that required the FAs to provide advance notice before resigning.  Neither Morgan Stanley nor the FAs appeared to care about that, however; they both claimed they were protected from liability for the flagrant breach of their contracts by something called the Protocol for Broker Recruiting (the “Broker Protocol”).

The Broker Protocol is a pact among hundreds of brokerage houses that purports to allow them to poach each other’s talent without being subject to suit or civil liability.  If recruiting employers follow the rules of the Protocol, they can hire each other’s talent regardless of whether the employees are bound by non-compete or non-solicitation covenants.  But what of notice of termination provisions?  Does the Protocol cover notice provisions?  Such questions are the stuff litigation is made of.

No court in the United States had ever addressed the issue of whether the Protocol covered notice provisions—until HA& W Capital Partners v. Bhandari.  In that case, the trial court granted the FAs’ motion for summary judgment and held the Protocol barred HAW’s claim that the FAs breached their promise to provide advance notice of their resignation.  In a decision that made national business news headlines, the Georgia Court of Appeals reversed, holding that advance notice of resignation provisions are “reasonable to allow the employer to prepare for an orderly transition …,” are not “restrictive covenants” comparable to non-solicitation provisions, and can be enforced by employers through suits for monetary damages.  The Court also held the Broker Protocol does not change that result.  That precedent-setting result was the product of the advocacy of Ichter Davis.  To hear more, watch this video.


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