Mariner Wealth Advisors is suing Savvy Advisors after several advisers left for the latter firm. Mariner claims the trio of former employees took the trade secrets with them.
In its lawsuit filed in Ohio federal court this week, Mariner alleged that former employees Brad Morgan, Nate Kunkel and Tim Gerard, with the help of Savvy, stole “confidential customer information, customer lists and customer contact information ” of Mariner and claimed Mariner's clients, resulting in the firm losing $60 million in assets under management.
According to the complaint, Morgan had been employed at Mariner since 2014 (later becoming an equity owner in the firm), while Kunkel and Gerard came on board in 2018. Morgan, Kunkel and Gerard specialized in working with Proctor & Cincinnati-based Gamble (though not exclusively).
The advisers had access to Mariner's client information, including their investment portfolios, risk appetite and information that Mariner believed competitors would want to access in order to lure clients away from the firm.
One of those competitors was Savvy, the New York-based fintech-affiliated RIA Savvy Wealth. The firm managed approx $401 million as of March 31and CEO of Savvy Wealth Ritik Malhorta was one of WealthManagement.com's “Ten to watch” for 2024. The firm was founded in 2022 and, in Mariner's opinion, has a growth strategy “focused on recruiting established wealth managers with existing books of business,” according to the complaint.
“Indeed, instead of cultivating clients through fair competition, Savvy solicits experienced wealth managers from around the country to obtain their books of business from competitors,” the complaint states. “Savvy does this without regard to the contractual obligations these wealth managers owe to their employers.”
As evidence that Savvy intended to target Mariner, the latter firm alleges that Savvy recently closed a job posting based at Mariner's headquarters in Overland Park, Kan., saying the new hires would pass on an AUM book of business of at least $15 million in Savvy.
In the complaint, Mariner also alleges that Savvy was intended to target Proctor & Gamble employees and retirees (including those served by Mariner). Around the time Savvy recruited Mariner employees, it added a page to its website soliciting business from clients affiliated with Proctor & Gamble.
According to Mariner, Morgan had been planning his departure since April 2024, despite signing a new non-solicitation and confidentiality agreement that month (Mariner claimed all three advisers had signed such agreements).
Morgan later convinced Kunkel and Gerard to join him at Savvy, and he allegedly spent all of May 11 forwarding appointments and information from his Mariner email account to a personal account. In addition, Mariner accused Savvy of asking Kunkel to break an agreement that he would give 90 days notice before leaving.
“(Savvy) wanted Kunkel to immediately join Savvy so that (defendants) could begin soliciting and poaching Mariner's customers from Mariner and directing them to a familiar face at Savvy,” the complaint said.
Representatives from Savvy and Mariner did not respond to requests for comment prior to publication.
A day after Mariner filed suit, Wise, smart, clever announced that Kunkel, along with three other advisors based in Sioux City, Iowa, Los Angeles and Tampa, would be joining the company.
The allegations in Mariner's complaint broadly parallel those made by Edelman Financial Engines in its lawsuit against Mariner Wealth, which manages more than $81 billion in client assets. Earlier this week, a federal judge was fired some of Edelman's claims, but allowed the embezzlement and conspiracy charges to stand as the trial progressed.