Overview
The Landscape
Financial services companies — from investment advisors and broker-dealers to fintech platforms and family offices — operate in one of the most heavily regulated environments in business. Shah Grossi provides business law and securities counsel to financial services firms navigating the legal complexity of this industry.
Key Legal Challenges
- —Structuring compliant securities offerings and investor agreements
- —Drafting client service agreements and advisory contracts
- —Managing employment and compensation arrangements
- —Protecting proprietary methods, platforms, and brand identity
- —Navigating regulatory requirements for capital raises and fund formation
Common Scenarios
Problems We Solve
- 01
A fund or SPV is structured without proper consideration of the Investment Company Act or Investment Advisers Act — exposing the sponsor to registration requirements and potential claims.
How we help: Securities Offering
- 02
Client advisory agreements have not been updated to reflect current SEC guidance on fees, performance presentation, or Form ADV disclosure — creating potential regulatory exposure on examination.
How we help: Risk & Compliance
- 03
A key advisor or portfolio manager is poached by a competitor, and the firm's non-solicitation, non-compete, and trade-secret protections are narrower than needed under California law.
How we help: Labor & Employment · Dispute Resolution
- 04
Proprietary trading methods, quantitative models, or client data are used by departing employees without adequate trade-secret protection — and enforcement options are narrower than the firm assumed.
How we help: Intellectual Property
Our Work
How We Help
Securities offering compliance including Reg D, Reg A, and crowdfunding
Investment advisory agreements and client contracts
Employment agreements, non-solicitation, and compensation plans
Entity formation and operating agreements for investment vehicles
Trademark and brand protection for financial services firms
Commercial contracts and vendor agreements
Legal Services
Related Practice Areas
Common Questions
Frequently Asked
Q.Do I need to register as an investment advisor?
If you provide investment advice for compensation, you likely need to register as an investment advisor either with the SEC (if you meet the AUM threshold) or with state securities regulators (below the SEC threshold). Exemptions exist for private-fund advisers, family offices, and certain narrow categories. Registration carries ongoing Form ADV, custody, code-of-ethics, and examination obligations. The exemption analysis is fact-specific and should be done before offering services.
Related: Securities Offering
Q.How do I structure a private investment fund?
A typical structure is a limited partnership (for the fund) with a general partner entity (usually an LLC) and a separate investment advisor entity. The fund uses a PPM and limited partnership agreement. Fund expenses, management fees, performance allocation, clawback, GP commitment, and LPAC composition are the key negotiated terms. Blue Sky filings are required in each state where an investor resides. The Investment Company Act exemption (typically 3(c)(1) or 3(c)(7)) must be preserved.
Q.What should a client advisory agreement include?
Scope of services, advisory fees and any performance fees (with proper qualified-client certification for performance fees), discretionary vs. non-discretionary authority, custody arrangements, proxy-voting policy, confidentiality, termination rights, arbitration clauses where applicable, and delivery of Form ADV Part 2. Post-engagement obligations regarding client data and ongoing confidentiality should be explicit. Required regulatory disclosures must be reviewed annually.
Q.Are non-compete and non-solicitation agreements enforceable for financial services employees in California?
Employee non-competes are generally void under California Business and Professions Code Section 16600. Non-solicitation of clients is heavily scrutinized and often unenforceable in California. Non-solicitation of employees and protection of genuine trade secrets remain enforceable when narrowly drafted. California-based financial services firms that expect out-of-state-style non-competes to work should plan for alternative retention and IP-protection strategies.
Related: Labor & Employment
Q.How do I protect proprietary trading models and methods?
Primarily through trade-secret protection — limited access controls, NDAs with employees and vendors, reasonable security measures, and documented protocols for handling confidential materials. California's Uniform Trade Secrets Act protects genuine trade secrets, but only where the owner has taken reasonable steps to maintain secrecy. Informal handling of proprietary methods is one of the most common reasons trade-secret claims fail later.
Related: Intellectual Property
Ready to Discuss
Your Financial Services Matter?
We respond to all inquiries within one business day.