The Washington state financial advisor who recently sued Hightower for breach of contract and poaching his clients was granted a temporary restraining order against the giant RIA aggregator.
In addition, the former Hightower advisor, Lars Knudsen, said in a press release Wednesday that a U.S. District Court judge for the Western District of Washington on March 27 granted his motion to move his lawsuit against Hightower Holdings back to state court and out of federal jurisdiction.
A King County, Wash., commissioner granted the restraining order Tuesday. It’s part of the suit Knudsen, of Bellevue, Wash., filed against Hightower last month in King County.
Late last month, Hightower countered with a strongly worded complaint against Knudsen and his equity entity, Telos Investment Holdings Inc., a former Hightower affiliate. Hightower had argued for moving the case to federal court in Chicago.
Knudsen founded Triad Wealth around 2008, and was approached for an affiliation with Hightower in 2018. Hightower said in its Illinois U.S. District Court filing that he then sold a stake in that business, HT Bellevue Advisors, to Hightower. Through Telos, Knudsen also owned a stake in HT Bellevue. The relationship soured as Knudsen said he wasn't able to maintain relationships with clients. Hightower responded by charging Knudsen with, among other things, stealing company secrets and misappropriating funds and diverting monies that should have gone to Hightower.
Knudsen sought the restraining order to stop Hightower and other defendants named in Knudsen’s initial suit from spreading “disinformation and false allegations about him to his clients,” according to the release.
“They’re bullies, plain and simple,” said Knudsen. “I’m pleased the great judges and commissioner are seeing through their antics. I have always been willing to reach a resolution, and maybe these rulings will lead to a more productive discussion with Hightower executives and advisors.”
In his initial suit, Knudsen claimed Hightower broke contracts, spread false allegations and tried to enforce overly restrictive non-compete agreements, among other actions. He claimed in the court filing that Hightower was trying to support its value amid rumors that it was selling its business.
“While we hope for a quick resolution to this legal matter, these milestone victories keep us on a legal pathway we hope will lead to an amicable and swift conclusion that allows Lars to move forward serving his clients as he has for decades,” said Knudsen’s lawyer, Andrew R. Escobar, a partner at Seyfarth Shaw LLP, in a statement.
Via email, a Hightower spokesman said the firm doesn’t comment on pending litigation.