Departing Broker Litigation Still An Issue
By Todd
We blogged the Ohio Supreme Court's ruling regarding memorized trade secrets here: http://wombletradesecrets.blogspot.com/2008/02/trade-secrets-all-in-head.html#links.
Well, the securities brokers who routinely depart one financial services firm for another have taken note and are concerned that this decision, and other regulatory developments under way, spell trouble for the departing brokers. We've linked hereto an article regarding the same in today's Investment News.
As for the recent Ohio ruling, that could hurt brokers who change firms, even when they take no customer records, industry observers say.
Prior court decisions have split over whether memories are trade secrets, Mr. Stief said, and the Ohio ruling will give courts and arbitrators more reason to restrict brokers.
In litigation, firms usually allege that the rep has illegally taken trade secrets.
Mr. Stief said he isn't aware of any industry cases yet citing the Ohio case, but "reps should be concerned, especially in Ohio."
At least 45 states have enacted the Uniform Trade Secrets Act, he said. Even states that haven't adopted the act could follow it, Mr. Stief said.
Well, the securities brokers who routinely depart one financial services firm for another have taken note and are concerned that this decision, and other regulatory developments under way, spell trouble for the departing brokers. We've linked hereto an article regarding the same in today's Investment News.
As for the recent Ohio ruling, that could hurt brokers who change firms, even when they take no customer records, industry observers say.
Prior court decisions have split over whether memories are trade secrets, Mr. Stief said, and the Ohio ruling will give courts and arbitrators more reason to restrict brokers.
In litigation, firms usually allege that the rep has illegally taken trade secrets.
Mr. Stief said he isn't aware of any industry cases yet citing the Ohio case, but "reps should be concerned, especially in Ohio."
At least 45 states have enacted the Uniform Trade Secrets Act, he said. Even states that haven't adopted the act could follow it, Mr. Stief said.
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