Stay of Non-Arbitrable Claims is Discretionary Where Arbitrable Claims Exist Baggesen vs. American Skandia Life Assurance Corp. Baggesen v. American Skandia Life Assurance Corp. & Securities America, Inc., 2002 U.S. Dist. LEXIS 23411 (D. Mass, 12/5/02). FAA (§ 3) * Agreement to Arbitrate * Stay of Litigation * Scope of […]
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 stock broker 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.
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State Laws Aimed At Arbitration Contracts Preempted BRADLEY v.HARRIS RESEARCH, INC., No. 00-16021 (9th Cir., 12/28/01): Chem-Dry is a well-known provider of carpet cleaning services and HRI is a Utah corporation that franchises these outlets. HRI granted a Chem-Dry franchise to the Bradleys in 1983 and, in the Franchise […]
Customer Not Beneficiary of Clearing Agreement Hossain vs. Rauscher Pierce Refsnes Hossain v. Rauscher Pierce Refsnes, Inc., Case No. 97-1380 (D. Kan., 5/15/00): A customer of an introducing broker is not a third party beneficiary of a clearing agreement between an introducing and clearing broker. Hossain claimed to be a […]
California Court upholds arbitration award Baraban Securities, Inc. v. Viersen & Watts, Case No. CV 00-02931 (WJR) (C.D. Calif., 4/18/00): Baraban alleges manifest disregard of the law in its petition to vacate the underlying NASD Award (NASD ID #97-02538, Portland, OR, 2/23/00), claiming that the claims were encompassed by a […]
Not unique employee, no geographic restriction, no injunction. S.G. Cowen Securities Corp. v. Messih, N.Y.L.Jnl., 5/24/00 (S.D. N.Y.): In the spring of 1999, Cowen hired Messih, a California resident, to be its Managing Director of Technology in its San Francisco office. They entered into an employment contract which expired on […]
Vestax Securities Corporation vs. McWood, No. 00-1936 (6th Cir., 2/14/02) Agreement to Arbitrate * Arbitration Agreement (SRO Requirement) * Scope of Agreement * Selling Away * SRO Rules * Statutory Definitions (Customer) * SRO Rules (NASD Rule 10301). Investors who purchased securities through a broker-dealers agents are customers, for purposes […]
Selling Away Claims Denied Firm Still Must Pay $32,000 In Forum and Related Fees ROBINSON v. FIRST ALLIED SECURITIES, INC., NASD ID #99-04441 (Pittsburgh, 9/25/01): This “selling away” case involved thirteen separately filed arbitrations that were consolidated for pre-hearing and hearing purposes. By the time of the hearing, the […]
Sawtelle Punitive Damage Award Vacated Court vacates punitive damage award on constitutional due process grounds as being arbitrary and excessive, labeling the $25 million dollar punitive damage award at “grossly excessive.” SAWTELLE v. WADDELL & REED, INC., No. 2330 (N.Y. App. Div., 1Dept., 2/11/03). Courts may allow arbitrators to award […]
Archives Attorney Fee Award For In-House Counsel Upheld SOFTSOLUTIONS, INC. V. BRIGHAM YOUNG UNIVERSITY, No. 981481 (Utah Sup. Ct., 5/19/00) Arbitral awards of attorney fees relating to time spent by in-house counsel are appropriate, but should be based on a cost-plus rate, rather than a market-rate formula. The primary issues […]
Third Time is not a charm Whale Securities Co., L.P. v. Godfrey, No. 565 (App. Div., 1Dept., 4/4/00): When SAC summarized the decision below, 10 SAC 9(16), we set out the facts in detail and posed the question: How would you decide? The question at hand, whether the Arbitrators engaged […]