Securities Fraud Attorney Blog

One of the most important aspects of securities arbitration proceedings is choosing your arbitrators. It is more art than science. Securities arbitration attorneys ought to spend a ton of time researching and vetting potential panel members. This includes not only reviewing prior awards but assessing value to said awards.

It is essential that attorneys review all of the arbitrators’ prior awards, not just the ones from the NASD. NYSE and AAA awards are available from the Securities Arbitration Commentator. NYSE awards are available on the NYSE website and on Westlaw.

Attorneys should not just review the awards from securities cases. Employment awards may be important too. For example, whether an arbitrator has awarded punitive damages in an employment case would be important to know.

Pro se cases should be disregarded unless there is big award given to a pro se claimant which is very rare.

Counsel must also study the attorneys involved in each arbitration award. You can’t just look at the awards. For example, there are some claimants’ attorneys who are known for bringing a high volume of weaker cases. A zero award for an attorney like that doesn’t tell me much; but if it’s a zero on a case brought by someone with a strong reputation, that would interest me.

Finally, call attorneys who have appeared before the arbitrators to get their first hand commentary on arbitrators. Awards often don’t tell the whole story on their face. There is nothing more helpful than hearing the war story from a trial attorney.

We are often asked what materials an attorney should bring to a large and complex, customer versus brokerage firm, securities arbitration hearing besides evidentiary documents. Below is a list of five things every practitioner should not be without:

1. Exhibit Binders and Tabs

You’d be surprised how many attorneys come to arbitration proceedings without bringing binders and tabs for the arbitrators to hold exhibits. It’s a mistake. Arbitrators appreciate the organized presentation of exhibits. Bring one for opposing counsel and a witness binder as well.

2. Discovery Binder

There are often discovery disputes during arbitration hearings. Make sure you have a binder with all of the document requests, document responses, motions to compel and their responses, orders by the Panel and indices of what documents have been produced by both sides.

3. Securities Arbitration Desk Reference

Professors Seth Lipner and Joe Long have put together an essential reference book which all attorneys should bring to the hearing. The Securities Arbitration Desk Reference has the arbitration statutes, SRO arbitration and conduct rules, the Blue Sky Laws, the Securities Acts and insightful commentary by two experienced securities arbitration professionals.

4. Federal Rules of Evidence

Along with the Reference by Professors Lipner and Long, attorneys should bring a copy of the Federal Rules of Evidence. One never knows how stringent a panel will follow the rules of evidence in a securities arbitration. It’s good to know you have the FRE with you.

5. Calendar

Unfortunately, large and complex securities arbitration hearings often take longer than the amount of days scheduled. Therefore, always remember to have your calendar with you to potentially schedule more hearing dates. Hopefully, tips one through four will help you avoid needing tip five.