CBIZ awarded one dollar in damages after $1 million claim against former advisor

On Behalf of | Dec 16, 2021 | Firm Transition

A financial services company was awarded just one dollar in an arbitration case against a former advisor after it had been seeking a total of over $1 million, according to a report by Financial Advisor.

CBIZ Financial Solutions filed its claim against Timothy Michael Schannep in May 2020. After spending 15 years as an advisor with CBIZ, Schannep departed the company in 2020 to launch his own firm in Arizona called Retirement Wealth Partners LLC.

CBIZ then alleged that Schannep had contacted its clients in violation of a confidentiality and non-solicitation agreement, and asked for compensatory damages. Following the arbitration process, a Financial Services Regulatory Authority panel decided on the award of one dollar. FINRA’s arbitrators concluded that the employment agreement’s non-solicitation provisions were too broad.

Under the terms of the agreement, Schanepp will still have to pay over $125,000 in attorney’s fees.

Transitioning employment in the financial services industry requires counsel that can evaluate any potential legal implications so you can properly manage risk and focus on transitioning your clients. If ignored, these risks can turn a simple transition into contested litigation with significant consequences. Lewitas Hyman offers comprehensive and sophisticated counsel to clients nationwide, originating from years of advising financial firms and registered representatives on firm transitions. For more information on how we can help you during a transitional period, contact our Chicago investment firm transition attorneys at (312) 291-4600 or through our online contact form.

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