Corporate & Securities Law

FINRA defense lawyers and claimants' counsel for investors are debating whether or not to allow the industry arbitrator to remain on FINRA arbitration panels. Today's [October 8, 2010] Wall Street Journal sheds some light on the debate.  Of the 560 cases that have thus far been involved in the pilot program which eliminated the industry arbitrator, just 23 have resulted in some sort of award; the vast majority were closed by settlement, FINRA said.  Of the small number that resulted in an award, investors won in 71% of the cases heard by a public panel.  This compares with 50% of the cases heard by a panel with an industry arbitrator, FINRA said.  Although small on sample side, this is a 40% difference and that must be taken into account.