Last January, an aggressive bid to vacate an arbitration defeat raised claims that a large bank’s brokerage unit and its counsel manipulated FINRA’s arbitrator-selection process through a “secret agreement.” The Georgia...more
On June 29, 2022, FINRA released the report of its independent investigation, concluding that allegations of a “secret agreement” to avoid certain arbitrators on an industry lawyer’s cases were untrue.
The allegations...more
6/30/2022
/ Administrative Review ,
Appeals ,
Arbitration ,
Arbitration Awards ,
Banks ,
Brokerage Accounts ,
Financial Industry Regulatory Authority (FINRA) ,
Forum ,
Professional Misconduct ,
Securities Litigation ,
Vacatur ,
Wells Fargo
A unanimous Supreme Court held May 23 that a party’s waiver of its arbitration right does not require showing prejudice to an opposing party, because the Federal Arbitration Act (“FAA”) prohibits arbitration-specific rules....more
5/31/2022
/ Arbitration ,
Arbitration Agreements ,
Employment Litigation ,
Federal Arbitration Act ,
Morgan v Sundance ,
Motion to Compel ,
Prejudice ,
Remand ,
Reversal ,
SCOTUS ,
Securities Litigation ,
Wage and Hour ,
Waivers
The U.S. Supreme Court held March 31, 2022, that the Federal Arbitration Act (“FAA”) does not allow federal courts to “look through” to the dispute underlying an arbitration to establish jurisdiction to confirm or vacate an...more
Last week, FINRA issued Regulatory Notice 21-16 cautioning member firms against attempting to limit customer claims through language in mandatory pre-dispute arbitration agreements. Rule 2628 prescribes disclosure...more
The Tenth Circuit joined a majority holding that the Federal Arbitration Act (“FAA”) permits modification of an arbitration award for a “material miscalculation of figures” if the miscalculation is “evident” on the face of...more
The dispute-resolution arm of broker-dealer regulator FINRA has cancelled all in-person arbitration hearings and mediation sessions through July 3, 2020. In-person hearings originally were cancelled through May 1, then...more
The Tennessee Court of Appeals has held that new arguments for vacatur or modification first raised over 90-days post-award do not relate-back and may not be considered under the State’s version of the Uniform Arbitration...more
On April 9, FINRA amended its customer arbitration rules to give customers more options when a Respondent firm or associated person becomes “inactive” during an arbitration....more
The Sixth Circuit recently affirmed that failure-to-supervise claims against a brokerage firm over outside business activities it knew nothing about nevertheless were arbitrable under FINRA Rule 12200(2) as “arising in...more
The Tennessee Supreme Court recently held that Tennessee’s Trust Code and broad trust-instruments authorize a Trustee’s execution of a pre-dispute arbitration clause. That isn’t a per se breach of fiduciary duty, but the...more
10/26/2017
/ Appeals ,
Arbitration ,
Arbitration Agreements ,
Beneficiaries ,
Binding Arbitration ,
Breach of Duty ,
Fiduciary Duty ,
Financial Adviser ,
Motion to Compel ,
Non-Signatories ,
Pre-Dispute Arbitration ,
Reversal ,
Securities Litigation ,
Third-Party Beneficiaries ,
TN Supreme Court ,
Trustees ,
Trusts
Effective April 3, 2017, all FINRA arbitration participants (except pro se parties) must use FINRA’s web-based DR-Portal to file and serve documents in both customer and industry arbitrations.
...more
2/8/2017
/ Arbitration ,
Electronic Filing ,
Filing Requirements ,
Financial Industry Regulatory Authority (FINRA) ,
Financial Institutions ,
Financial Markets ,
Investment ,
Mediation ,
Portal ,
Pro Se Litigants ,
Securities ,
Securities and Exchange Commission (SEC)
Within weeks, the Second and Third Circuits reached opposite conclusions over federal jurisdiction to confirm, modify or vacate arbitration awards. The Second Circuit now allows courts to look through the face of the...more
In a July 22 Notice, FINRA took umbrage at a growing line of Court decisions suggesting that a later or more-specific forum selection clause in an agreement between the parties may override a prior customer arbitration...more
The Fifth Circuit Bar Association’s summary reports:
“Appellants were investors who suffered financial losses as a result of R. Allen Stanford’s Ponzi scheme. In their arbitration complaint, they sought $80 million in...more
The Tennessee Court of Appeals recently held that a trustee’s signature of brokerage account agreement containing a pre-dispute arbitration clause did not bind the trust’s minor beneficiary.
The Court held that an “all...more
FINRA reported that, for 2015, Claimants won about half of private securities arbitrations: 47% for all-public panel decisions; 45% for majority-public panels. A colleague and securities mediator, Dana Pescosolido, recently...more
FINRA’s Dispute Resolution Task Force issued its Final Report in mid-December. The Report reflects the group’s consideration of wide-ranging issues affecting the nation’s principle dispute-resolution forum for broker-dealers,...more
Unless you live under a rock, you’ve heard about “Deflategate:” The Patriots’ use of allegedly under-inflated footballs during their 45-7 win over the Colts in last-year’s AFC Championship. In a 40-page opinion issued...more
9/4/2015
/ Arbitration ,
Collective Bargaining ,
Confrontation Clause ,
Corruption ,
Criminal Prosecution ,
Deflategate ,
Evidence ,
Federal Arbitration Act ,
Football ,
Fraud ,
New England Patriots ,
NFL ,
Sixth Amendment ,
Tom Brady ,
Willful Misconduct ,
Work Suspensions
The Tennessee Court of Appeals at Jackson recently enforced a NY choice-of-law provision against an arbitration challenge, holding that courts determine contract-formation issues, while arbitrators decide the scope and...more
8/19/2015
/ Aiding and Abetting ,
Arbitration ,
Arbitration Agreements ,
Breach of Duty ,
Choice-of-Law ,
Embezzlement ,
Federal Arbitration Act ,
Interstate Commerce ,
Motion to Compel ,
Negligence ,
Non-Signatories ,
TN Supreme Court ,
Unconscionable Contracts
On June 5, the Tennessee Supreme Court rejected a per se rule of unconscionability for non-mutual arbitration clauses, holding them enforceable if not too-one-sided and commercially reasonable under the...more
FINRA Dispute Resolution filed with the SEC a proposed change to Code of Arbitration Rules 12214 and 12601 (and industry Rules 13214 and 13601) to increase late cancellation fees from $100 to $600 per arbitrator and expand...more
An all-public panel of FINRA arbitrators entered a preclusion order and awarded $750,000 in punitive damages for Respondents’ failure to participate in discovery and disregard of pre-hearing filing requirements....more
Last week the Fifth Circuit weighed in on how inartfully crafted arbitration and forum-selection clauses might trump one another. Together with recent decisions from the Second and Ninth Circuits – each with cert petitions...more
The Second Circuit stayed its mandate last week to allow public-pension litigants to file cert petitions seeking review of its August holding that a subsequent account-agreement forum-selection clause requiring federal-court...more