On the last day for SEC review of FINRA’s latest proposal for improving the expungement process, the Authority temporarily withdraws the rule filing. Just one issue ago, we provided an extensive review of this long-running rule proposal — SR-FINRA-2020-030 — which has its origins in the Dispute Resolution Task Force and its Final Report and Recommendations. We won’t…
As reported in SAA 2021-19 (May 20), the Supreme Court on May 17 granted Certiorari in a case involving application of the “look-through” standard. Here is the promised elaboration. The Court will review Badgerow v. Walters, 975 F.3d 469 (5th Cir. 2020), a case we analyzed in SAA 2020-36 (Sep. 23). In the underlying case, the Fifth Circuit held that…
The arbitration underlying a suit challenging a FINRA Panel’s authority to hold a virtual hearing over a broker’s objection has been awarded. We reported last summer on Legaspy v. FINRA, No. 1:20-cv-04700, which was filed August 11 in the U.S. District Court for the Northern District of Illinois, alleging breach of contract because the FINRA Code of Arbitration Procedure doesn’t expressly…
For the second time in the past few months, SEC Chair Gensler was asked to articulate his views on mandatory securities arbitration, this time at a House Financial Services Committee meeting. As reported in SAAs 2021-13 (Apr. 5), -10 (Mar. 18), & -08 (Mar. 4), new SEC Chair Gary Gensler said at his March 2 Senate Banking Committee confirmation hearing that…
Independence Day 2021 will be ushered in with a bang for FINRA Dispute Resolution Services (“DRS”) constituents yearning for a return to in-person arbitration and mediation hearings. The Authority updated its Webpage around noon Eastern time today (May 10) to reflect that in-person hearings will resume in most hearing locations on July 5. The Website now says: “Beginning July 5,…
FINRA has issued a Regulatory Notice reminding industry parties on the proper use of predispute arbitration agreements (“PDAA”) in customer account agreements. Regulatory Notice 21-16, FINRA Reminds Members About Requirements When Using Predispute Arbitration Agreements for Customer Accounts, was issued on April 21. Why issue the Notice? “FINRA has become aware that customer agreements used by some…
The COVID-19 pandemic hit all Americans in many ways, and the legal and alternative dispute resolution systems were no exceptions. About a year ago the Alert surveyed the major national ADR institutions to gather information on how they were coping. With the vaccination program well under way, we thought it was a good time to check back in,…
FINRA Dispute Resolution Services (“DRS”) posted case statistics through March with the overall case filing decline unchanged from February, but with a major shift in the underlying details. In brief, the headlines are: 1) overall arbitration filings through the first quarter – 774 cases – are down 18%, the same as in February; 2) customer claims are now up 6%; 3)…
Our lead Squib in SAA 2021-13 (Apr. 15) reported that margin debt in February grew to a record $814 billion – up dramatically from a year ago – and examined what this might portend for securities arbitration. It prompted a Letter to the Editor from SAA Editorial Board member William D. Nelson, that we’ve opted…
Margin debt in February grew to $814 billion, up dramatically from a year ago. What this portends for arbitration remains to be seen. Several media outlets reported recently that investor margin debt as recorded by FINRA had grown to record highs. For example, the Wall Street Journal on April 7 reported in an article titled Investors Big and Small are Driving Stock Gains…