The case is part of a series of disputes brought to the Financial Industry Regulatory Authority by Wachovia over advisors who left the firm between 2008 and 2009 as it was rolled into Wells Fargo. The original claim dates back to May of 2009 when Wachovia accused St. Louis-based Stifel Nicolaus of “raiding, breach of the Protocol Agreement, injunctive relief, civil conversion, misappropriation, breach of fiduciary duty, breach of contract, violation of [Financial Industry Regulatory Authority] Rules and tortious interference with business relationships” with regards to four advisors.
That claim was consolidated with two similar filings made in New York, New York to bring the total to 18 advisors and $1.4 million in relief, which Wells Fargo requested for “wrongful conduct, including punitive and exemplary damages, interest, attorneys’ fees, costs, restitution, and such other relief as the panel deems proper.”
The dispute played out over 48 sessions from June 19, 2012 to November 29, 2012 and garnered $53,500 in hearing fees to be split by both firms. In the end, the panel denied the entirety of Wells Fargo’s claim in addition to all injunctive relief and punitive damages.
Wells Fargo had no comment on the case.
A.G. Edwards and Wachovia have brought several similar claims under the Wells Fargo name in the years since the mergers all pertaining to allegedly improper recruiting practice. An arbitration panel has ruled on five of those cases. Two awards went to Wells Fargo for amounts of $70,000 and $167,000, and in two other cases in December 2009, and May 2010, Wells Fargo was ordered to pay Stifel Nicolaus around $1 million in attorney’s fees.
“I don’t like litigation. I think these matters should be resolved between business people,” Stifel chief executive Ron Kruszewski, said in a phone interview with On Wall Street.
“The only consistency has been their ability to lose cases,” he jabbed.