Strategic Wealth Designers, an RIA firm based in Louisville, Ky., with some $900 million in assets, has sued one of its former lead financial advisors from Colorado, accusing him of breaching a confidentiality agreement and stealing company secrets to lure clients away from the firm after he took another job. 

According to a lawsuit filed April 18 in Adams County, Colorado, plaintiffs Strategic Wealth Designers and Strategic Wealth Investment Group said a former lead advisor at the firm, Jason H. Taylor, obtained access to trade secrets related to the firm’s clients, sales strategies, retirement management services and client leads. He had managed $20 million for the company but left on February 23 to join a firm called Farther Finance Advisors, working out of Denver. The case was removed to federal court on May 20 and is now being heard in the U.S. District Court for the District of Colorado.

Founded in 2002, Strategic Wealth Designers provides financial planning services to retirees and pre-retirees across 10 states. Its most recent Form ADV says it has more than $900 million in assets, more than $500 million of which is managed for 556 wealthy clients.

Taylor worked as a lead financial advisor at the company from about November 1, 2022, after he had responded to a job posting on Indeed, until February of this year. According to his website, he has expertise in tax planning, retirement planning, estate planning and life insurance.

“While still employed with SWD, Mr. Taylor accepted employment with another financial firm and utilized SWD’s trade secrets to solicit clients from SWD to his new employer,” the complaint said. “Mr. Taylor’s actions, which upon information and belief, continue to this day, are causing irreparable harm to SWD’s business and client relations.”

Strategic Wealth Designers said that when he took the job Taylor signed a non-compete, non-solicitation and confidentiality agreement, and that in case of a breach the firm was “entitled to damages including, but not limited to, three times the revenue generated to SWD of the accounts Mr. Taylor was managing based on the preceding 12 months of his employment, not to be less than $10,000 per client.”

The complaint said Taylor had been making more than $100,000 a year at Strategic Wealth Designers. At first he took a $96,000 base salary plus commissions, but he switched to commission-only business at some point.

The firm, according to the filing, gave Taylor access to confidential information including trade secrets, clients and prospects, billing practices and sales methods.

“By signing the agreement, Mr. Taylor agreed that he would not directly or indirectly make known, disclose, publish, disseminate, make available, or use any confidential information, other than [in] the proper performance of his duties as an employee of SWD,” the plaintiffs explained. “Mr. Taylor further agreed that he would not misappropriate or convert said confidential information” for his own personal use or for the benefit of an “unauthorized third party.”

The agreement also required Taylor to return all confidential data to Strategic Wealth Designers upon the termination of his employment, according to the suit. Taylor also couldn’t “solicit any customers, clients, or prospective customers” for 24 months.

However, two months before resigning, the firm claimed, Taylor stopped sending assets to the firm as he prepared to join Farther Finance. Besides agreeing to jump to another firm while still at Strategic Wealth Designers, his ex-employer claims Taylor used confidential information he gained at the firm to contact its clients to get their business before the “effective date of his termination.”

Taylor continued to solicit the firm’s clients using confidential information even after he left it, the plaintiffs alleged. Taylor even used a “new email account at Farther ([email protected]) to solicit” a client, the firm said in the suit.

In the filing the plaintiffs noted that around March 5 of this year Taylor “indicated and explained” to a client of Strategic Wealth Designers that its Retirement Planning University system belonged to him. (The system uses course materials related to retirement planning.) He told the client that if she remained with the firm, “she would not have an advisor to work with her.”

Strategic Wealth Designers is asking the court to issue, among other things, an injunction requiring Taylor to comply with the confidentiality agreement and asking to be awarded “all damages available under the agreement.”

Neither lawyers for the firm nor Taylor could be reached for comment.