New York Securities Lawyer Blog
Recently, on August 3, 2012, a Judge in the United States District Court for the Middle District of Florida granted a former Morgan Keegan customer’s motion to confirm and arbitration award and denied Morgan Keegan’s cross-motion to vacate the arbitration award. In the underlying arbitration, a FINRA Arbitration Panel awarded the claimant $194,976 in compensatory damages based upon Morgan Keegan’s alleged misrepresentations regarding the nature and riskiness of the investments and found Morgan Keegan liable for violations of ERISA, breach of fiduciary duty, negligence and negligent supervision. When granting the motion to confirm, the Florida District Court also issued sanctions against Morgan Keegan by ordering it to pay the former Morgan Keegan customer’s attorneys’ fees. The Court noted, “Although Morgan Keegan argues that concerns over the neutrality of arbitrators must be taken seriously, an award of sanctions in this case would not thwart the ability of arbitration participants to challenge neutrality. To do so in good faith, however, they must have an objective reasonable basis for such a challenge – something that is woefully lacking here.”