Wells Fargo accused a Florida attorney and former in-house counsel for the firm with helping a group of Wells Fargo Advisors financial advisors with more than $1.2 billion in collective assets under management leave the firm and start their own independent practice, where he now works.
Wells Fargo filed a suit in Ohio federal court against Steven Satter for his alleged role in helping the advisors leave a Kenwood, Ohio branch of the wirehouse. According to Wells Fargo, the advisors left the firm to establish DayMark Wealth Partners, which was formed in March of this year and located a few miles from Wells Fargo Advisors’ (WFA) Kenwood office.
"Wells Fargo seeks damages for harm caused by a former employee who has used the privileged and confidential information he gained as a company attorney to advise a competing firm in violation of his agreements, ethical obligations, and company policy," a Wells Fargo Advisors spokesperson said about the suit. "As an employee, he provided legal counsel on behalf of Wells Fargo Advisors (WFA) to the same team of advisors he now advises in competing with WFA."
DayMark Wealth Partners is affiliated with Dynasty Financial Partners, and runs on the Dynasty platform.
Satter had been with Wells Fargo since 2008, and “was responsible for employment and litigation matters” in a region including the Kenwood office. According to WFA, Satter’s “sole function” at the firm was to advise it on hiring practices, fiduciary duty claims and non-solicitation and contractual obligations.
In April of this year, Satter reportedly told Wells Fargo he was “retiring,” but instead worked to help create DayMark, according to the complaint. Satter is one of the group's founding partners and its legal counsel, according to an announcement of the RIA's launch.
Wells Fargo believed the plot to leave the firm and found DayMark began in summer 2021, with the group of advisors planning to solicit other WFA employees and clients to depart with them, including Michael Quin, a market manager for WFA’s Ohio region who had a “longstanding close relationship” with Satter.
Once Satter found out about the plans of Quin and the others, he did not report them to Wells Fargo, and began using the information he gained at WFA to provide employment and litigation counsel to the DayMark employees, helping the advisors to plan their departures from Wells Fargo.
A “DayMark” domain name and website were created the same day Satter announced his plans to retire, according to the suit. The seven advisors collectively resigned from Wells Fargo on June 6 and began immediately working at DayMark.
“Mr. Satter was in a unique position to utilize his experience and inside knowledge of sensitive WFA information - which he gained as WFA’s senior counsel - for the benefit of DayMark and the former employees,” the suit read.
Wells Fargo argued it had opened FINRA arbitration proceedings against the departed advisors, and said it was “inevitable” that Satter would disclose Wells Fargo “trade secrets, privileged, and confidential information” when offering advice to DayMark’s new business.
Satter did not return a request for comment as of press time.
Wells Fargo is seeking an injunction for Satter in using any confidential information gleaned from the wirehouse, as well as compensatory and punitive damages.