Morgan Stanley is asking a federal court to issue a restraining order against a former adviser who allegedly left for Raymond James just days after taking over the accounts of a recently retired representative.
Morgan Stanley filed the lawsuit in Florida federal court against Corbin Hoffner, who until a few weeks ago was counsel in the firm's Sebring, Fla. office. According to the lawsuit, Hoffner joined Morgan Stanley in 2020 with no industry experience. The following year, Hoffner allegedly partnered with Greg Seaton, who was with Merrill Lynch for more than two decades before joining Morgan Stanley in 2012, according to SEC filings. Seaton received about 90% of the commission income from these clients, and Hoffner agreed to a confidentiality policy as part of his employment, according to the suit. Seaton's client base represented about $90 million in assets under management, generating about $600,000 for the firm in 2024.
On August 27, Morgan Stanley and Seaton sent letters to his clients informing them of his upcoming retirement. Both the firm and Seaton said Hoffner would take over the accounts; Seaton told clients he had “full confidence” in Hoffner, according to the suit. Although he would retire, Seaton would continue to benefit from his clients through the Morgan Stanley Ex-Advisor Program, stipulating that Seaton would continue to receive a share of client revenue for five years as long as those clients remained with the firm.
But two days later, on Aug. 29, Hoffner abruptly resigned and joined Raymond James, according to the suit. Hoffner left with two other advisers, Dale and Matthew Grubb, and Joella Libero, a Morgan Stanley employee who assisted Seaton, to form the Grubb Group at Raymond James.
Raymond James did not respond to a request for comment before publication.
According to the lawsuit, Hoffner began an “aggressive campaign” to solicit Seaton's former clients, telling them that Morgan Stanley was “so big” that the firm “would not allow the freedom to serve smaller clients.” “. Morgan Stanley alleged that Hoffner even told false customers his former branch was closing.
Morgan Stanley claims it immediately contacted Hoffner to stop the request, but allegedly did not receive a response. The firm also speculated that Hoffner may have obtained confidential client information and said that after Hoffner left, Morgan Stanley employees found many files about clients Seaton and Hoffner worked with in a shredding bin to be destroyed.
The firm is seeking a temporary restraining order that would prevent Hoffner from soliciting any of his former clients while Morgan Stanley and counsel enter arbitration proceedings.