A U.S. District Court judge recently ruled a wirehouse did not deserve a temporary restraining order blocking two departing brokers from taking clients with them-a decision that could help set precedent in other breakaway broker cases.

Two brokers who left PRUCO Securities LLC took most of their clients and their lucrative business with them when they left the firm in February and created their own firm in Indiana. PRUCO Securities and Prudential Insurance Company of America asked the court for a temporary restraining order to stop the clients' move and an expedited FINRA arbitration hearing on charges including breach of restrictive covenant obligations and client confidentiality.

The U.S. District Court judge, in the Southern District of Indiana in Indianapolis, denied both the restraining order and the expedited hearing.

"This is certainly a win for the independent community," says Paul Lieberman, associated director of litigation at MarketCounsel, the regulatory consulting arm of Hamburger Law Firm LLC of Englewood, N.J. "The ruling sets a more level playing field that benefits independent brokers."

If the ruling is published, it will set precedent in all similar cases, Lieberman says, adding that it will not be known if it will be published for about a month. Meanwhile, the FINRA arbitration will continue on a non-expedited basis, he says. The brokers' new firm is in full operation and will have been handling the clients' investments for many months at that point. Lieberman says.