When Felix Stehling opened the first Taco Cabana restaurants in 1979, he likely didn’t anticipate how quickly the restaurant would grow. While Stehling had a number of successful restaurants and businesses before Taco Cabana, the little taco shack would be the one that cemented him in the culinary history books. Sadly, the current status of the Taco Cabana empire is nowhere near what it used to be, and Stehling’s stepson alleges that’s due to a breach of fiduciary duty.
Stehling passed away in December 2012. At the time of his death, his assets were valued at approximately $20 million. Fast forward seven years, and there is little left. Stehling’s stepson and heir has filed a lawsuit against Stehling’s longtime investment advisor claiming the fortune was squandered by over-leveraging the assets to generate cash.
While the investment advisor has been accused of fraud and self dealing, he has pointed to other causes for empire’s decline. The planner blames the trouble on the 2008 financial crisis and poor investment decisions made by Stehling in the years leading up to his death. However, what makes this fiduciary liability case particularly interesting is an arbitration agreement over twenty years old.
When Stehling hired the investment advisor in the 1990s, he signed an arbitration agreement. The financial advisor has asked a judge overseeing the case to dismiss the claim stating all disputes must be resolved through arbitration as agreed to in the original contract. For his part, Stehling’s stepson has fought against arbitration proceedings because the agreement was only between the investment advisor and his stepfather. He never agreed to such an agreement.
Fiduciary Duty With Financial Advisors
Fiduciary duty has a broad and complicated legal definition. Because of this, disputes between financial advisors and their clients can be come complicated. Matters can be complicated further if the parties agree to arbitration agreements like the one used by Stehling.
If you believe your financial advisor has breached his or her fiduciary duty, do not wait to call Feldman & Feldman today. Our fiduciary duty attorneys are experienced trial lawyers and litigators that can help you hold fiduciaries accountable for financial losses they cause. Contact us today to schedule an appointment.