James S. Lu

Two former employees of Washington-based Helium Financial Group LLC stole trade secrets and used them to start their own wealth management firm after they were fired, allowing them to create "a 'clone' of Helium's business model in startup form," Helium claimed in a lawsuit filed Wednesday in Seattle federal court Days after Helium fired Roshan Weeramantry and Cyrus Amini in July, the company alleged, the pair launched Hyphen Wealth Management LLC. The California-based startup then used Helium's trade secrets and other confidential information to woo Helium clients, according to the company's complaint. Weeramantry, a former partner, senior adviser and co-head of wealth management at Helium, had access to the firm's entire client database as well as proprietary data sets, financial metrics and internal formulas and algorithms, Helium claimed. It alleges that Weeramantry used Helium's recently developed initiative called Brightline, which he briefly oversaw while at the firm, to intercept clients and benefit Hyphen instead. "Brightline's entire creation and its individual components are confidential trade secrets that would confer a significant advantage on any competitor able to gain access to its insights without the expenditure of time and resources," Helium said. It was designed to acquire and manage outside partnerships between the company and external advisers and influencers, the company said, adding that the model "is novel to the industry and its components are not commonly known." Helium Financial and subsidiary Helium Advisors LLC are seeking to claw back profits that the defendants made through their alleged improper use of its intellectual property and collect additional, unspecified damages. They also want the court to bar the defendants from using Helium's confidential information going forward. The company further seeks an order preserving all of Helium's digital or hard-copy information controlled by the defendants, including client and vendor information, Dropbox files, emails and text messages. Amini, who was Helium's chief investment officer, didn't return his company laptop for almost two weeks after he was terminated, the company claimed. Helium sent him a letter in September demanding that he provide the login credentials for the laptop, but he allegedly replied that he didn't have the credentials and that they may have been destroyed along with other documentation. "Helium believes Amini destroyed this information in his efforts to deprive Helium from accessing his computer," the company said, adding that it believes Amini "retained valuable work product on that machine related to several projects that Helium is now unable to access." Helium claimed the defendants violated laws protecting trade secrets, including Washington's Uniform Trade Secrets Act and the federal Defend Trade Secrets Act. They also allegedly broke the terms of their employment contracts with Helium and interfered with the company's business relationships. Amini is a South Carolina resident and a lawyer licensed in New York, Helium said. The company claimed that he and Weeramantry added Helium as a defendant when they negotiated a settlement involving investments Weeramantry allegedly sold while at RINA Wealth Management Services LLC, where he worked prior to joining Helium in 2022. Signed by Weeramantry in May, the settlement agreement identified Helium as a defendant in the dispute even though the company was not named in the complaint and was never notified of the negotiations or provided with a draft of the settlement, Helium said in the suit. It added that Weeramantry lacked authority to sign the agreement on the company's behalf. Helium's chief compliance officer and a founding partner of the firm didn't discover the company had been added as a defendant in that matter until July, the company alleged, claiming it fired Weeramantry and Amini shortly thereafter. Helium claimed in the new suit that it's not the first time Weeramantry has been accused of misappropriating trade secrets, pointing to a California state lawsuit the company said was filed against him by RINA in 2022. The suit settled later that year, Helium said, with Weeramantry and another party required to pay RINA a confidential amount of money. Counsel for Helium did not respond to requests for comment Wednesday. Partners at the company also did not immediately respond. Weeramantry did not immediately respond to a phone message, and Amini did not immediately respond to a message on LinkedIn. Helium Financial Group LLC and Helium Advisors LLC are represented by Steven W. Fogg and Todd T. Williams of Corr Cronin LLP, James S. Rollins and P. John Veysey of Nelson Mullins Riley & Scarborough LLP and Patrice M. Kreider-Hughes of Kreider Hughes Law PLLC. Counsel information for the defendants was not immediately available. The case is Helium Financial Group LLC et al. v. Roshan Weeramantry et al., case number 2:25-cv-02198, in the U.S. District Court for the Western District of Washington.

Nov 5

4 min

Two former employees of Washington-based Helium Financial Group LLC stole trade secrets and used them to start their own wealth management firm after they were fired, allowing them to create "a 'clone' of Helium's business model in startup form," Helium claimed in a lawsuit filed Wednesday in Seattle federal court Days after Helium fired Roshan Weeramantry and Cyrus Amini in July, the company alleged, the pair launched Hyphen Wealth Management LLC. The California-based startup then used Helium's trade secrets and other confidential information to woo Helium clients, according to the company's complaint. Weeramantry, a former partner, senior adviser and co-head of wealth management at Helium, had access to the firm's entire client database as well as proprietary data sets, financial metrics and internal formulas and algorithms, Helium claimed. It alleges that Weeramantry used Helium's recently developed initiative called Brightline, which he briefly oversaw while at the firm, to intercept clients and benefit Hyphen instead. "Brightline's entire creation and its individual components are confidential trade secrets that would confer a significant advantage on any competitor able to gain access to its insights without the expenditure of time and resources," Helium said. It was designed to acquire and manage outside partnerships between the company and external advisers and influencers, the company said, adding that the model "is novel to the industry and its components are not commonly known." Helium Financial and subsidiary Helium Advisors LLC are seeking to claw back profits that the defendants made through their alleged improper use of its intellectual property and collect additional, unspecified damages. They also want the court to bar the defendants from using Helium's confidential information going forward. The company further seeks an order preserving all of Helium's digital or hard-copy information controlled by the defendants, including client and vendor information, Dropbox files, emails and text messages. Amini, who was Helium's chief investment officer, didn't return his company laptop for almost two weeks after he was terminated, the company claimed. Helium sent him a letter in September demanding that he provide the login credentials for the laptop, but he allegedly replied that he didn't have the credentials and that they may have been destroyed along with other documentation. "Helium believes Amini destroyed this information in his efforts to deprive Helium from accessing his computer," the company said, adding that it believes Amini "retained valuable work product on that machine related to several projects that Helium is now unable to access." Helium claimed the defendants violated laws protecting trade secrets, including Washington's Uniform Trade Secrets Act and the federal Defend Trade Secrets Act. They also allegedly broke the terms of their employment contracts with Helium and interfered with the company's business relationships. Amini is a South Carolina resident and a lawyer licensed in New York, Helium said. The company claimed that he and Weeramantry added Helium as a defendant when they negotiated a settlement involving investments Weeramantry allegedly sold while at RINA Wealth Management Services LLC, where he worked prior to joining Helium in 2022. Signed by Weeramantry in May, the settlement agreement identified Helium as a defendant in the dispute even though the company was not named in the complaint and was never notified of the negotiations or provided with a draft of the settlement, Helium said in the suit. It added that Weeramantry lacked authority to sign the agreement on the company's behalf. Helium's chief compliance officer and a founding partner of the firm didn't discover the company had been added as a defendant in that matter until July, the company alleged, claiming it fired Weeramantry and Amini shortly thereafter. Helium claimed in the new suit that it's not the first time Weeramantry has been accused of misappropriating trade secrets, pointing to a California state lawsuit the company said was filed against him by RINA in 2022. The suit settled later that year, Helium said, with Weeramantry and another party required to pay RINA a confidential amount of money. Counsel for Helium did not respond to requests for comment Wednesday. Partners at the company also did not immediately respond. Weeramantry did not immediately respond to a phone message, and Amini did not immediately respond to a message on LinkedIn. Helium Financial Group LLC and Helium Advisors LLC are represented by Steven W. Fogg and Todd T. Williams of Corr Cronin LLP, James S. Rollins and P. John Veysey of Nelson Mullins Riley & Scarborough LLP and Patrice M. Kreider-Hughes of Kreider Hughes Law PLLC. Counsel information for the defendants was not immediately available. The case is Helium Financial Group LLC et al. v. Roshan Weeramantry et al., case number 2:25-cv-02198, in the U.S. District Court for the Western District of Washington.

Nov 5

4 min

Certain underwriters at Lloyd's of London and other London market insurers must pay their full applicable policy limits under policies issued to the Archdiocese of New York, a state court ruled Monday in the archdiocese's suit seeking coverage for thousands of sexual abuse claims. Granting partial summary judgment to the archdiocese and its affiliated entities, Justice Lori S. Sattler held that the London market insurers must pay their "solvent shares" of the full policy limits of $200,000 per covered occurrence from May 1975 to May 1978 in excess of a $100,000 per occurrence retention. The insurers must also pay $300,000 per covered occurrence from May 1978 to September 1978 in excess of the retention. The plain language of the combined property, casualty and crime policies issued to the archdiocese provides that the general liability sublimit is not reduced by the $100,000 retention, the judge found. "The parties agree that the $100,000 payment is a 'self-insured retention', which courts have interpreted to be an amount that an insured covers before insurance coverage begins to apply rather than a deductible limiting the coverage amount," Justice Sattler said. "This is congruent with the language of the policies, which consistently use the phrase 'excess over $100,000,' indicating that LMI's liability is on top of the $100,000 retention rather than inclusive of it." According to court filings, the archdiocese and its affiliated entities have been named in more than 1,700 lawsuits alleging sexual abuse by members of the clergy and other employees following New York's enactment of the Child Victims Act in 2019 and the Adult Survivors Act in 2022. The acts provided a revival period for individuals to bring claims of sexual abuse and extended the statute of limitations for such claims. Units of Chubb, which insured the archdiocese under general and excess liability policies, kicked off the coverage dispute in June 2023. The archdiocese lodged its own counterclaims against Chubb and filed a third-party suit against a slew of other carriers, including the London market insurers, in June 2024. The London market insurers insured the archdiocese between May 1975 and September 1978. The policies provided aggregate coverage, whereby the insurers would pay up to $500,000 in excess coverage so long as the archdiocese paid a certain amount in a given policy period, and specific excess coverage, whereby the insurers agreed to pay a specified amount on a per occurrence basis in excess of a $100,000 retention. According to the ruling, the London market insurers insured 90% of the policy limits while a third party that is now insolvent insured the remaining 10% of the policy limits. The judge on Monday rejected the London market insurers' contention that the policy language reflects an intent to reduce the sublimits by the retention, saying interpreting the sublimits as inclusive of the retention would render specific excess coverage inapplicable for most categories of losses. "If the intent was to exclude those types of losses from the specific excess agreement, the policies would have explicitly done so," Justice Sattler said. "A contrary interpretation, that the parties must infer that specific excess coverage does not trigger for some types of losses even though the language plainly states that those limits 'apply for all purposes,' does not accord with the reasonable expectations of an insured party." A representative of the archdiocese declined to comment. Representatives of the London market insurers and Chubb units did not immediately respond to requests for comment Monday. The Archdiocese of New York and its affiliated entities are represented by James R. Murray, Jared Zola, Jeffrey L. Schulman, Robyn L. Michaelson, Dominique G. Khani, Stephen Wah, Amber N. Morris, James S. Carter and Omid Safa of Blank Rome LLP and by Fredric S. Newman and Bradley J. Nash of Hoguet Newman Regal & Kenney LLP. The Chubb units are represented by Jonathan Rosenberg, Allen W. Burton, Daniel L. Cantor and Samuel B. Weiss of O'Melveny & Myers LLP and by John F. Baughman and Nathaniel E. Marmon of Baughman Kroup Bosse PLLC. The London market insurers are represented by Michael J. Frimet and George Vogrin of DAC Beachcroft LLP. The case is Archdiocese of New York et al. v. Century Indemnity Co. et al., case number 652825/2023, in the Supreme Court of the State of New York, County of New York.

Sep 8

3 min

The Cato Institute and others have come out in support of a call for the U.S. Supreme Court to resolve a circuit split over the U.S. Securities and Exchange Commission's disgorgement powers, saying a recent Ninth Circuit decision unlawfully delegates legislative power to executive officials. Cato filed a brief Monday in a case involving a $2 million disgorgement order from the SEC against a man accused of participating in a $6 million pump-and-dump scheme, saying the justices should review the Ninth Circuit's recent ruling in the case to prevent the agency's "overbroad assertion of legal authority from upsetting constitutional separation of powers and violating due-process rights." The defendant in the SEC matter, Ongkaruck Sripetch, last month asked the high court to resolve a two-to-one split over whether the SEC can demand defendants disgorge their ill-gained profits, even if the agency cannot prove investors suffered monetary losses due to the defendants' actions. The Ninth Circuit acknowledged the split in issuing its ruling, siding with the First Circuit in reasoning that the SEC does not need to show pecuniary harm to fraud victims in order to demand disgorgement from those who allegedly committed the fraud. That butts up against a Second Circuit decision in 2023 that reached the opposite conclusion, the Ninth Circuit said. Cato argues the issues presented in Sripetch's suit are "ripe for review" and that the court should reaffirm three "bedrock principles of constitutional order" — that an executive agency may only exercise powers clearly granted to it by Congress, that Americans' due process rights entitle them to fair notice of the law, and that "the prospect of selective law enforcement justifies narrowly construing even powers explicitly granted to executive agencies." The institute further contends that allowing the Ninth Circuit's ruling to stand would broadly interpret disgorgement and unlawfully delegate legislative power to executive officials. "Failure to provide a discernible principle grants the SEC unchecked discretion to selectively enforce penalties against foes and pocket the proceeds," the brief states. The California Alternative Investments Association, also known as CalALTs, and three appellants in another case pending before the Ninth Circuit also filed amicus briefs. CalALTs says the Ninth Circuit's decision "heightens the stakes" for asset promoters and managers by transforming the typical equitable remedy of disgorgement into something closer to a punitive remedy. "Sanctioning the SEC's disgorgement authority without a finding of pecuniary harm will produce inequitable and destabilizing consequences, including chilling innovation in the alternative investment sector, which will deprive U.S. investors of novel investment opportunities," the association's brief states. Keri Curtis Axel of Waymaker LLP, who represents CalALTs, told Law360 on Wednesday, "There is no doubt that SEC policies such as pursuing disgorgement in strict liability registration cases where no investor has been harmed have chilled growth in the United States in alternative investments, like crypto." The other brief was filed by three appellants in U.S. Securities and Exchange Commission v. Barry et al . The suit claims that a group of Pacific West Capital Group Inc. agents sold unregistered securities and didn't properly register as broker-dealers. According to the agents' Tuesday brief, shortly before its ruling in Sripetch's case, the Ninth Circuit approved a disgorgement award against them based on the "abstract theory" that "investors inherently suffer pecuniary harm through the 'loss of the time value of their money' whenever funds are invested in an unregistered offering, regardless of whether they ultimately recoup their principal or even profit." The agents argue the ruling in their case allows disgorgement as a "de facto penalty" for technical violations of federal securities laws and ignores the equitable principle that disgorgement must be "for the benefit of investors." Therefore, they urge the Supreme Court to take up Sripetch's case to resolve the current circuit split and clarify what constitutes as the requisite pecuniary harm. In a statement to Law360 on Wednesday, Nicholas Morgan of Investor Choice Advocates Network, who represents the Pacific West Capital Group agents, said the SEC keeps trying to revive the theory of "victimless disgorgement," which the Supreme Court has already rejected. "When investors haven't lost a single dollar, the SEC has no business demanding massive financial judgments disguised as equity. The court should step in and put an end to it," he said. The circuit split has opened in the wake of the Supreme Court's 2020 decision in Liu v. SEC , in which the justices ruled that the agency may seek disgorgement so long as the amount awarded does not exceed a wrongdoer's net profits. In upholding a lower court's ruling in favor of the disgorgement order against Sripetch, the Ninth Circuit said Liu did not require it to find pecuniary harm because disgorgement is "grounded in the principle" that a person cannot keep their ill-gotten gains. But Sripetch, echoing the Second Circuit, tells the justices in his petition Liu emphasized that disgorgement was about returning money to victims of an alleged fraud. "[A]n investor who lost nothing is owed nothing," he says. The SEC declined to comment Wednesday, and counsel for the other parties did not immediately respond to requests for comment. The Cato Institute is represented by H. Hunter Bruton, John L. Gibbons and Noel Hudson of Smith Anderson Blount Dorsett Mitchell &Jernigan LLP. The California Alternative Investments Association is represented by Keri Curtis Axel, Becky S. James and Viviana Andazola Marquez of Waymaker LLP. The Pacific West Capital Group agents are represented by Nicholas Morgan of Investor Choice Advocates Network, and Igor V. Timofeyev, Alyssa K. Tapper and Alexander Sweet of Paul Hastings LLP. Sripetch is represented by Daniel Geyser and Michael Qian of Haynes Boone, and Kenneth White and Tyler Creekmore of Brown White & Osborn LLP. The SEC is represented by D. John Sauer of the Solicitor General's Office. The case is Sripetch v. SEC, case number 25-466, in the Supreme Court of the United States.

Nov 19

4 min

Certain underwriters at Lloyd's of London and other London market insurers must pay their full applicable policy limits under policies issued to the Archdiocese of New York, a state court ruled Monday in the archdiocese's suit seeking coverage for thousands of sexual abuse claims. Granting partial summary judgment to the archdiocese and its affiliated entities, Justice Lori S. Sattler held that the London market insurers must pay their "solvent shares" of the full policy limits of $200,000 per covered occurrence from May 1975 to May 1978 in excess of a $100,000 per occurrence retention. The insurers must also pay $300,000 per covered occurrence from May 1978 to September 1978 in excess of the retention. The plain language of the combined property, casualty and crime policies issued to the archdiocese provides that the general liability sublimit is not reduced by the $100,000 retention, the judge found. "The parties agree that the $100,000 payment is a 'self-insured retention', which courts have interpreted to be an amount that an insured covers before insurance coverage begins to apply rather than a deductible limiting the coverage amount," Justice Sattler said. "This is congruent with the language of the policies, which consistently use the phrase 'excess over $100,000,' indicating that LMI's liability is on top of the $100,000 retention rather than inclusive of it." According to court filings, the archdiocese and its affiliated entities have been named in more than 1,700 lawsuits alleging sexual abuse by members of the clergy and other employees following New York's enactment of the Child Victims Act in 2019 and the Adult Survivors Act in 2022. The acts provided a revival period for individuals to bring claims of sexual abuse and extended the statute of limitations for such claims. Units of Chubb, which insured the archdiocese under general and excess liability policies, kicked off the coverage dispute in June 2023. The archdiocese lodged its own counterclaims against Chubb and filed a third-party suit against a slew of other carriers, including the London market insurers, in June 2024. The London market insurers insured the archdiocese between May 1975 and September 1978. The policies provided aggregate coverage, whereby the insurers would pay up to $500,000 in excess coverage so long as the archdiocese paid a certain amount in a given policy period, and specific excess coverage, whereby the insurers agreed to pay a specified amount on a per occurrence basis in excess of a $100,000 retention. According to the ruling, the London market insurers insured 90% of the policy limits while a third party that is now insolvent insured the remaining 10% of the policy limits. The judge on Monday rejected the London market insurers' contention that the policy language reflects an intent to reduce the sublimits by the retention, saying interpreting the sublimits as inclusive of the retention would render specific excess coverage inapplicable for most categories of losses. "If the intent was to exclude those types of losses from the specific excess agreement, the policies would have explicitly done so," Justice Sattler said. "A contrary interpretation, that the parties must infer that specific excess coverage does not trigger for some types of losses even though the language plainly states that those limits 'apply for all purposes,' does not accord with the reasonable expectations of an insured party." A representative of the archdiocese declined to comment. Representatives of the London market insurers and Chubb units did not immediately respond to requests for comment Monday. The Archdiocese of New York and its affiliated entities are represented by James R. Murray, Jared Zola, Jeffrey L. Schulman, Robyn L. Michaelson, Dominique G. Khani, Stephen Wah, Amber N. Morris, James S. Carter and Omid Safa of Blank Rome LLP and by Fredric S. Newman and Bradley J. Nash of Hoguet Newman Regal & Kenney LLP. The Chubb units are represented by Jonathan Rosenberg, Allen W. Burton, Daniel L. Cantor and Samuel B. Weiss of O'Melveny & Myers LLP and by John F. Baughman and Nathaniel E. Marmon of Baughman Kroup Bosse PLLC. The London market insurers are represented by Michael J. Frimet and George Vogrin of DAC Beachcroft LLP. The case is Archdiocese of New York et al. v. Century Indemnity Co. et al., case number 652825/2023, in the Supreme Court of the State of New York, County of New York.

Sep 8

3 min