CUNA Mutual Enforces Non-Compete Clause

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TACOMA, Wash. – In its latest effort to enforce departing employees’ non-compete agreements, CUNA Mutual Group asked a federal court here to stop a former employee from using her CMG book of business at  CUNA Mutual competitor Ameriprise.

In filing a request for a temporary restraining order and preliminary injunction, CUNA Mutual says Sophia Spencer, one of the company’s top performers while selling insurance at Vancouver’s Red Canoe CU, “has already solicited and induced some of the highest net worth clients whom she serviced, and caused millions of dollars in assets under management to transfer to a competing firm,” since leaving CUNA Mutual June 30.

Spencer, claims CMG, “is actively pirating away a book of business consisting of assets under management of more than $92 million.”

The credit union insurer is asking the federal court for an order barring Spencer from using or disclosing, and requiring her to return any documents or information obtained from CUNA Mutual or the Red Canoe Financial Group, including client lists, prospect lists, client or prospect contact information, client or prospect insurance or financial information, and/or client or prospect investment information.

CUNA Mutual has not been shy about enforcing its non-compete clause in the past. Last December it filed suit against Terri Dandino, a former life insurance broker and salesman, asking for $1.3 million payment of commissions she allegedly earned after she went to work for Life Insurance Company of Southwest.

“CUNA Mutual will vigorously defend our business relationships with credit unions, including the enforcement of non-compete clauses with former employees,” said Phil Tschudy, spokesman for CUNA Mutual, about the Spencer suit. “We believe this legal action is in the best interests of CUNA Mutual and Red Canoe Credit Union.”

The suit says since her resignation Spencer has targeted specific clients of Red Canoe Financial, with an emphasis on high net worth clients she had serviced. CUNA Mutual alleges Spencer called them, met with them and solicited them to move their accounts to Ameriprise. At least a dozen of the clients are transferring their funds, the suit said.

Lawyers for Spencer did not return a phone call seeking comment.


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