Failure to Provide Citations in Award Explanation Is Not Evidence of Manifest Disregard of the Law BUNZL DISTRIBUTION v. DEWBERRY, No. 00-2325 (8th Cir., 6/11/01): Claims of manifest disregard, based upon an alleged failure to apply applicable law, will not be presumed by an omission to cite the law. The […]
Arbitration
Securities arbitration refers to the alternative dispute resolution process to resolve claims between broker firms and their customers and employees. FINRA operates the largest arbitration forum in the United States for the resolution of these disputes.
While no one can be forced to give up their rights to a trial in court, virtually all agreements between investors and their stockbrokers include mandatory arbitration agreements, and every registered stockbroker is required to arbitrate their disputes with their customers and firms.
Our site has been providing information regarding securities arbitration since 1995, starting with Overview of the Securities Arbitration Process. We update the site on a regular basis and invite you to explore our commentary and links and to ask questions.
Prefer to talk by phone? Call Mark Astarita at 212-509-6544 with any questions regarding securities law, enforcement and arbitration.
Manifest Disregard Requires Knowledge and Decision to Ignore
Manifest Disregard Means Knowledge of, and Decision to Ignore, the Law Rosenbaum vs. Imperial Capital, LLC and Rich, 2001 US Dist. LEXIS 17577 (D. Md., 10/29/01) Rosenbaum was a customer of Imperial, a broker-dealer. Rich, an RR at Imperial handled the account. In September of 1997, Rich solicited the purchase […]
Arbitrators Decide Disqualification of Counsel Issue
Benasra vs. Mitchell, Silberberg & Knupp, No. B147537 (Cal. App., 2/13/02) The favored mechanism for dealing with disqualification of counsel in an arbitration proceeding must be for the arbitrators to decide the issue. When Plaintiff looked across the arbitration table and saw former counsel representing the other side, he cried […]
Eligibility and Attorney Fee Awards Under Review
Courts accept cases dealing with Eligibility and Attorney Fee Awards ELIGIBILITY AND ATTORNEY FEES UNDER REVIEW: The Florida Supreme Court is reviewing its position on the awarding of attorney fees in arbitration and the effect of the six-year eligibility provision on a litigant’s claims. Barron Chase v. Moser was accepted […]
Futures Account Agreement Does Not Encompass Claims Relating to Separate Agreement
Crotser vs. Smith Barney & Co., Inc., NO 228226 (Mich. App., 4/30/02) Appealability * Scope of Agreement * Arbitration Agreement * Competing Agreements. A futures account agreement does not encompass claims relating to separate consulting services provided by the FCM. Plaintiff entered into an agreement with a predecessor firm (Hutton) […]
Broad Arbitration Agreement Covers All Accounts by Owner
White v. Salomon Smith Barney, Inc., 2001 Cal. App. LEXIS 2844 (Cal. App., 1Dist., 11/30/01) A broad arbitration provision covering one account of a client may be construed to cover disputes arising in other accounts. The Whites opened ten brokerage accounts with SSB and subsequently brought suit against SSB with […]
Court Compels Arbitration Without Direct Account Relationship With Customer
If selling broker is associated person, and claimant is his customer, BD compelled to arbitrate BMA Financial Services, Inc. v. Guin, 2001 U.S. Dist. LEXIS 18556 (W.D. La., 9/27/01): In the absence of a direct account relationship, a court will compel a firm to arbitration, if the selling broker is […]
Clearing Firm’s Arbitration Agreement Includes Claims Against Introducing Firm
Hirshenson v. Spaccio, Case No. 5D00-2145 (Fla. App., 11/30/01). Appealability – Arbitrability ? Breadth of Agreement ? Scope of Agreement – State Statutes Interpreted (Fla. Stats. Ch. 517) ? State Law, Applicability of. Customer’s fraud claims against introducing broker, including claims under Florida Securities Act, are subject to arbitration under […]
Arbitration Chairman Selection Time Frame Shortened by NASD
Since no one ever agrees, let’s make the time period 5 days – NASD Staff Under a proposal submitted to the SEC on March 3, NASD will allow only 5 days for parties to agree on the selection of a chairperson, as opposed to the 15-day period in Rule 10308(c)(5). […]
Forcing Customers to Waive Rights Has Consequences
Linden vs. American Express Financial Advisors – since forcing Claimant to give up her rights under California law, court vacates order compelling arbitration. Linden v. American Express Financial Advisors, Inc., No. CIV 205839 (Cal. Super. Ct., Ventura Cty., 9/25/02). Agreement to Arbitrate * Enforceability * Equitable Doctrine (Impossibility; Impracticality; Unconscionability). […]
