Non-Solicitation Agreements: Announcing Your Change of Firms without Getting Sued

Recently, an Indiana federal district court tackled the issue of whether a former employee’s change in employment announcement to clients constitutes solicitation. In Edward D. Jones & Co., L.P. v. Kerr, No. 1:19-cv-03810-SEB-DML (S.D. Ind., Nov. 14, 2019), the court concluded the announcement was not a solicitation and, for those looking to enforce or defend against non-solicitation agreements, this decision provides helpful insight into behaviors that may cross the line from notification to solicitation.   


Mr. Kerr was a Financial Advisor for Edward Jones, serving as the sole advisor in the Westfield, Indiana branch for twenty years. At the outset of his employment, Kerr executed an employment agreement (“Agreement”) requiring, among other things, the return of account records and customer files upon termination or resignation, and a one-year prohibition on soliciting the employer’s clients.  

Kerr resigned his position during a meeting on August 1, 2019; however, the parties offer drastically different versions of how the resignation came about. Kerr claims that he printed confidential client reports in preparation for the meeting and destroyed them thereafter; Edward Jones contends Kerr printed the reports because he knew he would be terminated, and he used the reports to solicit clients.  

On August 2, 2019, Kerr began working at a different firm. Over the next few days, he contacted his former clients to announce his transition. Around that same time, Edward Jones also notified Kerr’s clients of the transition through letters and telephone calls.  

Edwards Jones filed suit to enforce the Agreement and requested a temporary restraining order; Kerr did not challenge the validity of the Agreement but argued that his actions were not “indirect solicitations.” The court limited its review to the alleged breach of the non-solicitation provision of the Agreement. 

Transition Announcement Does Not Constitute Indirect Solicitation 

Ultimately, the court denied Edwards Jones’ request for a TRO. Relying on the below case-specific facts and Kerr’s intent, the court concluded Kerr’s announcement was not a solicitation.  

Content of the notification. During the notifications, Kerr did not provide information about his new firm unless clients initiated the discussion or explicitly requested more information. In fact, some clients first learned of the transition from phone calls by Edward Jones’ employees, not Kerr.  

Origination of alleged solicited clients. Approximately 70 percent of clients that followed Kerr to his new firm had personal relationships with Kerr that predated his employment with Edward Jones.  

Employer’s protocol for new employees transitioning from other firms. Edward Jones’ protocol requires new employees to contact their former clients to inform them of their new affiliation and provide their new contact information. The court found this very persuasive and acknowledged such an announcement may be consistent with industry practices as evidenced by the employer’s policies.  

Extent of the former employee’s contacts with clients after the initial departure notification. Kerr made no contact with the former clients after the initial notification.  

The Kerr court notes that many courts reject the theory that an announcement like Kerr’s constitutes a solicitation, even when an employment agreement prohibits direct or indirect solicitation; however, transitioning employees should approach any client notifications with caution.  


Financial advisors have a fiduciary duty to inform clients of a change in employment, but they must ensure that any notification does not cross the line into solicitation because non-solicitation provisions are enforceable.   

If you have questions regarding a non-compete or non-solicitation agreement, contact the Ottinger Firm for a Review & ConsultationWith offices in New York and California, our skilled employment attorneys will examine your agreement and meet with you to review and discuss your options. We have litigated non-compete and non-solicitation agreements in federal and state court and mediated, arbitrated and negotiated hundreds of disputes. Contact us today at (415) 325-2088 (San Francisco), (213) 377-5717 (Los Angeles), or (347) 305-5294 (New York). 

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Robert Ottinger, Esq.

Robert Ottinger is an employment attorney who focuses on representing executives and employees in employment disputes. Before starting his firm, Robert slugged it out in courtrooms trying cases for the government. Robert served as a Deputy Attorney General for the California Department of Justice in Los Angeles and then as Assistant Attorney General for the New York Attorney General’s Office in Manhattan.

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