The financial services industry is a complex, highly regulated environment that requires in-depth knowledge of an always evolving web of regulations and the ability to understand the benefits and risks of complex transactions. At Epstein Becker Green, our multidisciplinary team helps asset managers, broker-dealers, hedge funds, banks, and insurance companies confront the legal and regulatory challenges impacting their operations and their workforces. We provide proactive, comprehensive solutions drawn from our first-hand knowledge of the unique employment and transactional hurdles our clients face.
We Understand the Financial Services Industry
We’ve been in our clients’ shoes. Clients value the insight and experience we bring to their matters. Members of our team have served as head of litigation at Chemical Bank; head of the Civil Division of the U.S. Department of Justice (DOJ); Acting Attorney General of the United States; trial attorneys in the Antitrust, Civil, Criminal, and Tax Divisions of the DOJ; Assistant U.S. Attorneys; and Senior Counsel in the Enforcement Department and the Office of the General Counsel of NASD, the predecessor to FINRA. We hit the ground running with an in-depth understanding of highly nuanced transactions and intricate regulatory mandates.
Our team’s legal and industry knowledge, judgment, and trial experience allows us to resolve critical matters with minimal business disruption. We represent financial institutions, their officers and directors, and associated professionals during trials in federal and state court, and during arbitrations before FINRA and the American Arbitration Association. Our litigators have achieved positive results in high-stakes commercial and business disputes spanning breach of contract, breach of fiduciary duty, customer complaints, executive compensation, fraud, and securities actions.
Tough scrutiny in an ever-changing enforcement environment puts financial institutions and banks at high risk. We treat every inquiry by the DOJ, the SEC, FINRA, and the IRS as if it could go to trial. Our success in avoiding formal actions stemming from grand jury investigations, SEC proceedings, and Rule 8210 requests is a testament to the effectiveness of our strategy. We anticipate difficult questioning and communicate effectively with prosecutors and regulators to either negotiate favorable terms or fight the matter at trial.
Employment & Trade Secrets
Our deep bench of employment lawyers and litigators helps maintain healthy workforces while confronting a wide range of actions that arise during hiring, compensation reviews, evaluations, promotions, and terminations. Financial services clients trust us to investigate allegations of whistleblowing, discrimination, sexual harassment, and retaliation complaints. We also help employers protect their intellectual property and sensitive data in employee mobility actions involving restrictive covenants, misappropriation of confidential information, and trade secrets.
Banks and banking customers rely on Epstein Becker Green to defend and prosecute claims involving consumer debt securitization, letters of credit, factoring, derivative contracts, and check warranties. We have also represented the FDIC and RTC in claims against failed savings and loan associations and commercial banks. When banks receive customer complaints, we defend and resolve those actions before the SEC and FINRA.
Counseling & Regulatory Compliance
Even while under near-constant regulatory scrutiny, financial institutions can avoid costly complaints with comprehensive compliance and risk management strategies. We analyze the risks inherent in their operations, from supervisory procedures to hiring procedures and product review processes. We are well versed in the strict documentation, disclosures, and reporting rules that guide the hiring and termination of employees, particularly broker-dealers and investment advisors. Our team also frequently assists clients in identifying and quantifying risk in mergers and acquisitions through due diligence evaluations.
- Defended an international bank before FINRA against claims of fraudulent inducement in hiring brought by three former financial advisors. Though the advisors sought $30 million in damages for allegedly ruined careers, we overcame a difficult factual situation by simplifying the case and precluding their expert from testifying. We secured a decision that dismissed the employees’ claims and awarded our client $3.4 million in damages.
- Cleared Aetna Life Insurance Company of liability for an employee’s income tax payable on Social Security disability benefits deducted from disability insurance payments. We saved our client from potentially millions in claims by persuading the court to agree with Aetna’s interpretation of a disability provision found in thousands of its insurance policies.
- Defended a multinational European bank in several FINRA arbitrations arising from the 2008 international financial crisis in which bankers sought tens of millions of dollars in damages for unpaid bonuses. We successfully defended the bank’s decision to use its bonus pool to instead fulfill its fiduciary obligations. In a series of complex, contentious disputes, we offered the bank’s board members and its former general counsel as witnesses and secured outcomes that avoided unfavorable precedent and reputational damage to the bank.
- Achieved a successful jury verdict in state court in favor of a financial services firm sued by a former commodities broker. We disproved the broker’s claim that the financial services firm had misclassified him as an independent contractor.
- Represented a Fortune 100 financial services company alleging trade secret misappropriation, breach of a non-compete, and employee raiding claims against a competitor. After four weeks of hearing testimony, a FINRA arbitration panel found for the company and awarded $20 million in combined damages and punitive damages.
- Defended a global financial services company in a case in which the Supreme Court of New York, Appellate Division, held that a former employee’s disability discrimination claim should have been dismissed on the employer’s summary judgment motion.
- Successfully defended an insurance client against a former broker who was terminated for selling unapproved investments and who then sued for breach of contract. The plaintiff alleged that our client had “poached” insurance clients worth $85 million in book value. After a three-week trial, it took the jury just 55 minutes to reject the plaintiff’s suit.
- Quashed a $7 million whistleblower claim filed against a national insurance company by the president of the company’s subsidiary. We succeeded in transferring the case from a court to arbitration, and the arbitrator ruled in favor of the insurance company.
- Won a FINRA arbitration for a financial services company in a case in which an employee terminated for refusing to cooperate in an internal forgery investigation alleged he was dismissed without cause and sued for millions of dollars in damages. After 26 days of arbitration hearings, the panel found that the employee had been terminated for cause and dismissed his case.
- Defended a national bank in a putative class action alleging that the bank violated New York State law by refusing to hire applicants based on their criminal history. We argued and won an early motion to dismiss, before a class could be certified. We demonstrated that Section 19 of the Federal Deposit Insurance Act authorized the bank’s actions and preempted New York State law.
- Successfully represented insurance brokers and their new employer in a trade secret and restrictive covenant dispute brought by a former employer by persuading the court to apply California law, rather than New York law, despite a choice-of-law provision requiring the application of New York law.
- Successfully defended a brokerage firm in a whistleblower action by a former chief compliance officer during a week-long FINRA arbitration.