Opinion
Case No. 01-8800-CIV-HURLEY/LYNCH
October 2, 2001
ORDER GRANTING MOTION FOR PRELIMINARY INJUNCTION AND SETTING BOND
THIS CAUSE is before the court upon the Plaintiff Merrill Lynch, Pierce, Fenner Smith, Inc.'s Motion for Preliminary Injunction. [DE # 2-2] This matter was previously referred to United States Magistrate Judge Frank J. Lynch, Jr., pursuant to 28 U.S.C. § 636-39 and Rule 72 of the Federal Rules of Civil Procedure, for a recommended disposition. [DE # 8]. After holding an evidentiary hearing, Magistrate Judge Lynch filed a Report and Recommendation on September 14, 2001. [DE # 23] Defendant filed his objections to the Report and Recommendations on September 18, 2001. [DE # 24].
Pursuant to 28 U.S.C. § 636(b)(1)(C), the court has made a de novo determination with respect to those portions of the report with respect to which an objection has been lodged. Having done so, it is hereby ORDERED and ADJUDGED as follows:
1. Plaintiff's Application for Preliminary Injunction [DE # 2-2] is GRANTED, and the recommended terms of preliminary injunction set forth at p. 8-9, ¶¶ A, B of Magistrate Judge Lynch's Report and Recommendation [DE # 23] are approved as set forth below.
2. The defendant PETER SILCOX is hereby ENJOINED AND RESTRAINED directly, or indirectly, alone or in concert with others, including any officer agent representative or employee of defendant's current employer, Salomon Smith Barney Inc., from:
(i) soliciting any business or account transfers from any client of Merrill Lynch whom the defendant serviced or whose name became known to defendant while in the employ of plaintiff for a period of one year from the date of his resignation (excepting defendant's family and relatives);
(ii) accepting any business or account transfers from any account customers whom the defendant contacted after resigning from Merrill Lynch for the purpose of doing business with Smith Barney, (excepting defendant's family and relatives);
(iii) accepting any business or account transfers from any client whose records (or information contained in client records) were obtained by defendant in violation of paragraph 1 of his employment agreement;
(iv) using, disclosing or transmitting any confidential information or records of the plaintiff, including the names, addresses and financial information of the plaintiffs clients.
3. Further, the defendant PETER SILCOX, and anyone acting in concert or participation with him whom who receives actual notice of this order, including any agent, employee officer or representative of defendant's current employer, Salomon, Smith Barney Inc., are further ORDERED to return to Merrill Lynch's West Palm Beach office all records, documents and information pertaining to Merrill Lynch's customers, whether in original, copies, computerized, handwritten or other form, and to purge all such information from their possession, custody or control within 24 hours after service of this order upon the defendant or his legal counsel.
4. Plaintiff shall post a bond in the amount of $100,000.00 as a condition to issuance of any preliminary injunction by this court.
5. This order is without prejudice to the duly appointed arbitration panel of the National Association of Securities Dealers assigned pursuant to Rule 10335(g) of the NASD Code of Arbitration Procedure to modify, dissolve or extend the terms of the preliminary injunction at any time after the panel has been convened. This order shall otherwise remain in full force and effect pending a determination on the merits by the NASD panel assigned pursuant to Rule 10335(g) of the NASD Code of Arbitration Procedure.
6. The parties shall file a joint status report in this case by no later than December 1, 2001 indicating whether any further action is needed by this court in this federal case.