Mariner Wealth Advisors is still waging legal battles on several fronts, with numerous cases pending in federal and state court.
In one, Edelman Financial Engines is trying to stop Mariner's efforts to dismiss the case, arguing that the firm “has created a business model that drives away the investment and success of its competitors.”
Edelman initially filed her lawsuit v. Mariner in Kansas federal court late last year. In the original complaint, Edelman accused Mariner of luring 10 advisers and inducing them to break their employment contracts. Edelman claimed to lose about $621 million in assets in the process.
But Mariner hit back in December, accusing Edelman of a years-long campaign for him “illegally stifle fair competition.”
Meanwhile, Mariner has made numerous attempts to strike down Edelman's lawsuit. In December, Mariner argued that the lawsuit should be dismissed while four pending arbitrations against some of the advisers who left Edelman continue.
But in March, the court denied the motion, arguing that Mariner had not established that the arbitrations would have any restrictive effect on the case in Kansas federal court.
Last month, Mariner took another bite out of the apple, arguing that the case should be dismissed because Edelman had not disclosed sufficient facts to support their claims, with claims “based on purported statements that are mere hyperbole or opinion.”
Edelman filed on April 8, calling Mariner's motion “another delaying tactic.”
“Simply, Mariner builds its assets under management through illegal methods, including overt interference with competitors' contracts and customer relationships and misappropriation of competitors' trade secrets,” Edelman's response said.
Edelman's response provided more details about the allegations against Mariner. He alleges that advisers who left Edelman recreated a list of clients from memory with Mariner's help, including names and amounts of assets. Mariner also tied compensation to performance milestones, assuming planners will convince Edelman clients to transfer assets to Mariner.
In an effort to poach Edelman's clients, Mariner agents reportedly told Edelman employees that “Edelman is a sinking ship,” “everyone is jumping overboard,” and that Mariner was ending the Edelman business, according to Edelman.
“Additionally, Mariner agents have asked Edelman employees the following rhetorical question: 'Do you really want to be the last planner at the firm?'” Edelman's response read.
Mariner did not respond to requests for comment before publication.
Meanwhile, in the Superior Court of the State of Los Angeles, RWA Wealth Advisors' lawsuit against Mariner is proceeding apace.
The firm filed its lawsuit in January, alleging Mariner ran a “clandestine” scheme with adviser Brendon Berman acting as an “undercover agent” to steal client lists from his employer, Polaris Wealth Advisory Group, before leaving for in Mariner (RWA bought Polaris in 2022).
But in its response to the RWA filed March 18, Mariner requested a jury trial and dismissed the RWA, claiming the firm's “claims ring hollow like conspiracy theories and disparaging rhetoric.”
“This is a case of a company choosing to target a competitor with frivolous litigation rather than examine and address the reasons why its financial advisors take their business elsewhere,” Mariner's response said.
Mariner argued that RWA lacked evidence to support the allegations, claiming that the idea that they had “coached” Berman to steal trade secrets was false and noting that Berman had been represented by his own attorney during the transition. Mariner also questioned why RWA had sued Berman in May 2022, seeking recovery for the same actions, according to the response.
“Gamesmanship is transparent,” read Mariner's response.
Additionally, the $43 billion tax-focused planning firm Avantax is involved in its own lawsuit against Mariner, filed in Iowa state court last fall before being moved to federal court in January. Avantax accused adviser Michael Carignan of breaking the terms of his restrictive covenants when he left for Mariner with the latter firm's “support and encouragement”.
Avantax also sued Mariner and former adviser Molly Nelson in February, alleging similar actions after she transferred to Mariner. This week, Avantax voluntarily dismissed their case, but Nelson's own lawsuit against Avantax is ongoing. Nelson argues that it attempts to breach what it claims are “unenforceable” restrictive covenants required by Avantax.
According to a new motion by Mariner in the Carignan case, Avantax allegedly wanted the Carignan and Nelson cases tried in the same jurisdiction “to avoid the risk of inconsistent rulings.” Therefore, Mariner wants this case returned to Iowa state court (decision on this is pending).