Judge Blocks Device Surrender for 30 LPL Advisors

Judge Jinsook Ohta on Wednesday removed the portion of a December 2024 order that had required 30 financial advisors who moved from Ameriprise to LPL Financial to surrender personal phones, computers and other devices for a court-appointed forensic review. The revised order, filed in the U.S. District Court for the Southern District of California, keeps most of the earlier injunction in place but deletes the device-surrender requirement.

Ohta wrote that ‘significant factual changes have rendered enforcement of the forensic review requirement for advisors and their devices no longer equitable.’ The judge noted a merits hearing is scheduled for Oct. 5, 2026.

Ameriprise sued LPL in July 2024, alleging a pattern of harvesting and misappropriating private client information, including names, addresses and Social Security numbers. In December, Ohta ordered LPL to copy and preserve any client data that may have been improperly transferred and to make preserved records available for FINRA arbitration. The initial order also directed the 30 recruited advisors to turn over personal devices to a court-appointed examiner.

The recruited advisors objected to the device searches, saying they were not consulted and had not consented, and described themselves as caught between ‘two corporate behemoths.’ After the judge initially denied their motion to intervene, the advisors appealed to the Ninth Circuit. Three appellate judges found the lower court had ‘abused its discretion’ in denying the intervention motion and sent the dispute back to Ohta, prompting the revised order.

Ohta also pointed to changes in the arbitration landscape. When the original directive was issued, only Ameriprise and LPL had agreed to FINRA arbitration. Since then, Ameriprise has filed arbitration claims against each of the 30 advisors, and nine of those advisors have been dismissed from arbitration, a development the judge said made a preliminary injunction against them unwarranted.

The updated order keeps obligations on LPL. The firm must search its systems for any client data that may have been retained improperly, delete such records and notify Ameriprise so the firm can decide whether to notify affected customers and what to include in any notice. In a recent court filing, LPL attorney Alexander Madrid said the company complied with the data-preservation and deletion instructions, described the effort as technical and resource-intensive, and reported that work began on Jan. 10, 2025, with data deletions completed between March 14 and April 9, 2026.

Ameriprise’s complaint said LPL used a ‘bulk upload tool’ from 2018 through early 2022 to help recruited advisors transfer confidential customer data; LPL has said it stopped using the tool. The firms and recruited advisors have faced related proceedings. In March, a FINRA arbitration panel ordered LPL and a recently recruited father-and-son advisor team to pay $200,600 plus interest over claims of contract and recruiting-standard violations, while denying Ameriprise’s requests for punitive damages and additional remedies.

Ameriprise declined to comment on the revised order. LPL did not return a request for comment. The court’s updated ruling leaves the device question unresolved for now while maintaining LPL’s duty to identify and remove any improperly retained customer information ahead of the October merits hearing.