Lawing Financial: Former employee conspired with Cavner

Nadia Cavner allegedly conspired with Andrew Denney, according to court documents.

Last edited 2:23 p.m., Nov. 18, 2015

In its ongoing legal battle with Nadia Cavner, Overland Park, Kan.-based Lawing Financial now is claiming a former employee of its Springfield office conspired with the former prominent financial adviser.

In a motion filed Nov. 7, Lawing Financial seeks to add Andrew Denney to the Cavner suit; injunctive relief is now sought against both. Denney resigned as a financial adviser in the Springfield office late last month and established his own firm, Prosperity Financial Group, at the Kingsley Office Park, 1354 E. Kingsley St., Ste. C.

In Springfield Business Journal’s article, “Three local Lawing Financial employees exit to form new firm,” Denney said he left the office because of distractions related to the case.

“A lot of it has to do with the litigation surrounding Lawing and Nadia,” said Denney, who joined broker-dealer platform LPL Financial Holdings Inc. (Nasdaq: LPLA) in his new venture.

In the motion, Lawing Financial claims it discovered in October that Denney allegedly aided Cavner in interfering with Lawing’s client relationships, harassing its financial advisers and staff, and providing financial advice to former clients despite her being barred from acting as a broker by the Financial Industry Regulatory Authority because of a felony conviction. Lawing Financial’s attorney, John Shaw of Berkowitz Oliver Williams Shaw & Eisenbrandt LLP, declined to comment.

Reached by SBJ this morning, Denney said the motion includes two conflicting stories of the series of events. One, he said, claimed Cavner threatened him by texting, “Planning to KILL you!” allegedly because she was angry he asked a client about their communications with Cavner. The other, Denney said, was filed in this month’s motion and claims they conspired with each other against Lawing.

“To craft a conspiracy theory when you have people’s lives on the line is very, very sad,” Denney said.

The suit arose in April, after Lawing Financial purchased the Nadia Cavner Group in 2014 for $3 million. Cavner countersued in August, denying Lawing’s claims that she overvalued her company and interfered with its business operations. Further, she said Lawing defamed her in the media to avoid some $2 million in payments owed for the purchase of her firm.

Lawing’s motion alleges Denney resigned abruptly on Oct. 29 and took with him two other Lawing employees - Angela Sampson, former Springfield office administrator for Lawing, and Ashlea Schmidt, who worked as administrative assistant for the local office - as well as a computer, hard copy documents and other electronic files containing client records and other trade information.

“Until his abrupt departure without notice from our firm on Oct. 29, Denney had been entrusted with broad access to the company’s most sensitive and prized resources: its client relationships and confidential information. Denney abused that trust and was working behind the scenes in collusion with Cavner, who told him to never say a word,” Lawing officials said in a provided statement.

According to court documents, Denney allegedly set up Prosperity Financial Group to steal some $200 million in assets under management from Lawing.

“When we left, we left squeaky clean,” said Denney, who has no disclosures of wrongdoing on his FINRA profile. “All the clients are coming here on their own. They’re bringing copies of their own statements (and) Social Security numbers.”

To support its allegations, Lawing Financial includes in the motion a series of text messages between Cavner and Denney that were supplied in court proceedings by the defendants.

“It’s a damn shame I did not meet you 15 years ago. We would have taken over the world!!!!!” Denney allegedly texted Cavner, to which she purportedly responded, “You have to trust me and let me help you behind the scenes. Those that I help, I trust them to never say a word.”

Further, Cavner allegedly texted Denney he should go out on his own. “What the hell are you waiting for?” she asked, according to the motion.

Denney confirmed texts from Cavner encouraged him to leave the firm, but he said those messages were not the reason he resigned from Lawing to start his own company.

“It was all the practices being conducting by Lawing, which is why we left,” he said, noting he first met Cavner when Lawing Financial bought her firm and hasn’t been in contact with her since the Kansas company filed suit against Cavner.

In a counterargument, Cavner’s attorneys claim the texts were taken out of context and were actually discovered much earlier than Lawing Financial claims.

“We are confident that justice will prevail, and we look forward to a successful resolution of the case," the Lawing statement said.