California Appeals Court Publishes Ruling That a Profitable Account Does Not Defeat a Financial Elder Abuse Claim, According to Reif Law Group, P.C.
LOS ANGELES--( BUSINESS WIRE)--Reif Law Group, P.C. today announced that the California Court of Appeal has certified for publication its October 8 decision in Adam DeVone et al. v. Morgan Stanley & Co., LLC et al., converting an opinion that previously could not be cited by anyone into authority that trial courts across the state are bound to follow.
The Second Appellate District, Division Three, entered the publication order on October 29. The order states that publication followed a request “by appellants and nonparties to this action.” Reif Law Group, P.C., counsel for the appellants, petitioned for publication on October 22. The Public Investors Advocate Bar Association (PIABA), an international organization of investor-side attorneys formed in 1991, filed a letter supporting the request on October 26.
Under the California Rules of Court, an unpublished opinion may not be cited or relied on by any court or party. Most appellate decisions are never published. This one is now available to every investor, lawyer, trial judge and arbitrator in the state.
“A profitable account is not a license to ignore a family’s reported concerns about an aging client,” said Brandon S. Reif of Reif Law Group, P.C., counsel for the plaintiffs. “The Elder Abuse Act asks what the firm knew at the time, not how the trades happened to turn out.”
A Profitable Account Is Not a Defense
The trial court dismissed the financial elder abuse claim after finding that “the account only grew in value.” The defendants pointed to net gains between 2010 and 2012.
The Court of Appeal held that was the wrong question. Under California’s Elder Abuse Act, a taking is wrongful if the defendant “knew or should have known” that the conduct “was likely to be harmful to the elder,” a standard the court described as “inherently forward-looking.”
“Under the Elder Abuse Act, a defendant who exposes an elder to a foreseeable risk of harm does not escape liability merely because the risk did not materialize,” the court wrote. The opinion holds that proof of a wrongful taking “does not require evidence of a net financial loss,” and that commissions charged in connection with conduct a defendant knew or should have known was likely to harm an elder may themselves constitute a taking.
Why the Firm Asked the Court to Publish
In its October 22 request, Reif Law Group told the Court of Appeal that three defense contentions recur in nearly every case brought on behalf of an older investor, and that each had been advanced and erroneously accepted in the trial court below: that account appreciation forecloses a financial elder abuse claim; that a financial professional’s fiduciary duty is bounded by the services for which the professional was formally retained and paid; and that the limitations period caps the period of recoverable conduct even where the action is timely.
The request also explained why published authority in this area is scarce. Customer disputes with broker-dealers have for decades been channeled into FINRA arbitration by predispute agreements, and arbitration awards are unreasoned, unpublished and without precedential effect. The volume of these disputes, the firm argued, has never been reflected in the volume of published California law governing them. This case produced a reasoned appellate decision only because the parties’ earlier FINRA arbitration was dismissed without prejudice to the claims being pursued in court.
Reif Law Group asked the court to publish the opinion in full.
What the Opinion Describes
Maurice Voce was a barber and self-taught investor who died in 2012 at age 93. Financial advisor John R. Privitelli took over his accounts in the 1990s and worked with him until June 2012, communicating “pretty much daily,” according to evidence the court cited.
The opinion describes a 1998 letter in which Morgan Stanley memorialized restrictions limiting Voce’s account to a conservative covered-call strategy and capping his uncovered options positions; Privitelli agreed that Voce’s age, 79 at the time, was likely a motivating factor. It describes a September 1999 internal firm communication stating that “because of [Voce’s] age” the firm “thought it would be prudent to reign in exotic stuff,” a reference to uncovered options, and reflecting that the firm carved out an exception for Privitelli’s branch. According to the opinion, the strategy continued in the account for another decade.
The opinion further describes a February 2009 margin call after the account had fallen by nearly half over the preceding year, and a roughly $900,000 loan the trusts obtained to retire the margin debt. Privitelli agreed that the margin debt, about eight percent of the account’s value, “could have very well” been created by the options trading strategy.
According to the opinion, Privitelli received a December 2010 email from plaintiffs describing Voce’s memory lapses, disorientation and declining health. The opinion states that Privitelli testified he was “on notice” of Voce’s cognitive impairment as of January and February 2011, and again in March and April of that year, yet “still executed specific trades” on Voce’s instructions “while [he] was cognitively impaired.”
Asked directly whether the reports of Voce’s cognitive impairment “had to be escalated to risk management or some supervisor,” Privitelli answered, “Sure. It should have been.” The opinion notes that although he testified at trial that he believed he had spoken to a manager about Voce’s situation, he was impeached with earlier deposition testimony indicating he did not forward plaintiffs’ email to risk management.
Based on plaintiffs’ analysis of the account records, the accounts reflected approximately 30,690 trades and approximately $2.0 million in trading costs between 1993 and 2012, roughly 98 percent of it predating the September 2010 cutoff the trial court imposed.
A Timely Case Reaches the Whole Relationship
The trial court found the lawsuit timely, then barred any conduct before September 11, 2010, confining a relationship of roughly two decades to its final 21 months. The Court of Appeal reversed, holding that once the condition for timeliness is satisfied the limitations period does not “operate to constrain the scope of actionable conduct.”
“The statute of limitations tells you when to file. It does not tell you how much of the story the jury gets to hear,” Reif said. “Once the case is timely, the full course of conduct is on the table, and here that runs back to the 1990s.”
The Paperwork Does Not Define the Duty
The trial court had erroneously held that the defendants owed no fiduciary duty as to tax and estate-planning advice because they were not hired or paid to give it. The Court of Appeal reversed, holding that the scope of the duty turns on “the facts of the relationship as a whole,” including the parties’ course of dealing and advice the professional actually rendered, and revived those claims.
“Advisors routinely give tax and estate planning advice, and then point to a policy saying they never agreed to give any,” Reif said. “The Court of Appeal has now made clear the paperwork does not decide that question. The relationship does.”
The court affirmed dismissal of one theory, a fiduciary duty claim premised on excessive trading, and reversed in all other respects. Reif thanked PIABA for its letter supporting the publication request.
Reif Law Group previously served as counsel of record in Hasso v. Hapke (2014) 227 Cal.App.4th 107, a published decision addressing when an investment adviser–client relationship gives rise to a fiduciary duty.
The Court of Appeal’s decision does not establish liability. It holds that the plaintiffs’ evidence was sufficient to be weighed by a jury rather than resolved against them as a matter of law. The allegations remain unproven, the defendants dispute them, and the case returns to the Los Angeles County Superior Court for further proceedings.
Case: Adam DeVone et al. v. Morgan Stanley & Co., LLC et al., California Court of Appeal, Second Appellate District, Division Three, No. B339219. Opinion filed October 8, 2026; certified for publication October 29, 2026.
About Reif Law Group, P.C.
Reif Law Group, P.C. represents investors, consumers, professionals and businesses in complex financial, securities, fiduciary and professional misconduct disputes, in trial courts, in arbitration, and on appeal. The firm is led by President Brandon S. Reif.