Seyfarth’s fourth installment, presented by Scott Humphrey, Marcus Mintz and Kristine Argentine, focused on trade secret and client relationship considerations in the banking and finance industry, with a particular focus on a firm’s relationship with its FINRA members.
As a conclusion to this well-received webinar, we compiled a list of takeaways:
- Enforcement of restrictive covenants and confidentiality obligations for FINRA and non-FINRA members are different. Although FINRA allows a former employer to initially file an injunction action before both the Court and FINRA, FINRA—not the Court—will ultimately decide whether to enter a permanent injunction and/or whether the former employer is entitled to damages as a result of the former employee’s illegal conduct.
- Address restrictive covenant enforcement and trade secret protection before a crisis situation arises. An early understanding of the viability of your company’s restrictive covenants and the steps your company has taken to ensure that its confidential information remains confidential will allow your company to successfully and swiftly evaluate its legal options when a crisis arises.
- The Defend Trade Secrets Act (“DTSA”), if signed into law, will provide federal jurisdiction for misappropriation of trade secret claims. The DTSA will provide for the recovery of misappropriated trade secrets, compensatory damages, as well as exemplary damages and attorneys’ fees in certain circumstances.
- Understand the Protocol for Broker Recruiting’s impact on your restrictive covenant and confidentially requirements. The Protocol significantly limits the use of restrictive covenants and allows departing brokers to take client and account information with them to their new firm.