Merrill Lynch, Pierce, Fenner & Smith v. Bradley

Kenneth Bradley (defendant) was an account executive for Merrill Lynch, Pierce, Fenner & Smith, Inc. (Merrill Lynch) (plaintiff). Bradley had signed an account-executive agreement stating that all client-information records were Merrill Lynch property at all times during and after an executive’s employment with the company. Executives could not remove records or copies from company property or discuss the information outside of conducting business. If executives were terminated, they were prohibited from soliciting Merrill Lynch clients for one year after their end date. The agreement also provided that all disputes arising out of employment or termination would be settled through arbitration. Bradley also had to sign the New York Stock Exchange form, which required him to arbitrate any dispute arising between himself and a member organization like Merrill Lynch. Bradley resigned from Merrill Lynch, and on the same day, he allegedly called his clients and urged them to transfer business to his new employer. Merrill Lynch filed suit in federal district court and petitioned the court for a preliminary injunction to stop Bradley from soliciting former clients. Bradley moved to stay the injunction and compel arbitration. The district court granted the injunction pending arbitration and compelled the parties to arbitrate their dispute. Bradley appealed the district court’s granting of the injunction.