Two Florida planners will reduce the scope of their lawsuit against the CFP Board in a bid to protect client data. But that is not stopping the board from seeking the confidential details.
"That information is highly relevant to claims that still remain before the court," CFP Board spokesman Dan Drummond wrote in an email. "Discovery requests for client lists and related information are common in litigation where, like here, plaintiffs contend that their business relationships have been damaged."
Husband-and-wife planners Jeffrey and Kimberly Camarda of Fleming Island, Fla., are withdrawing three of their claims against the board, including two antitrust claims and one due process claim in their ongoing legal fight with the organization.
"Ultimately, our duty to [clients] far exceeds our own desire for justice," husband-and-wife planners Jeffrey and Kimberly Camarda of Fleming Island, Fla., said in a statement.
The decision of what the Camardas must produce rests with U.S. District Court Judge Richard Leon in Washington. The couples' amended lawsuit would leave intact other claims of harm, including breach of contract and fostering unfair competition.
The board had asked Leon to force the planners to turn over the names and addresses of all their clients a move one prominent CFP calls "woefully far reaching."
The board says the client data would be protected under a confidentiality agreement the court has agreed to. The Camardas' contend such a deal offers insufficient protection to clients.
Earlier this year, Leon denied the board's request to protect itself from sweeping requests for documentation from the Camardas. Despite its earlier protests, the board sent the Camardas 375,000 pages of documents in May.
The couple is now asking Leon to restrict the amount of material they must ultimately produce. But instead of waiting for Leon's decision, they decided not to risk the possibility that he would force them to turn over information that they, like many planners, consider "highly sensitive."
The board's attempts to discover our clients intimate financial and other information have been extremely troubling to us," the Camardas say in their statement. "We are adamant that we have a legal, moral and ethical duty to protect this information, and we fervently believe that [the board] has no enforceable right to this data."
The legal battle turns on whether the board may publicly sanction the couple for allegedly breaking its rules for use of the term fee-only when advertising their planning practice.
The board admitted it made a mistake earlier this year by allowing hundreds of advisors in large firms, such as wirehouses and insurance companies, to use the term on its website. While those violations remained in place, the board sought to punish the Camardas and several other planners for similar alleged infractions.
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