By Jeffrey M. Haber Arbitration is an alternative dispute resolution mechanism that enables parties to resolve disputes without going to court. Arbitration is similar to a trial without the formalities. It is an adversarial proceeding where the parties can call witnesses and present evidence to a neutral arbitrator or panel of arbitrators. The rules of discovery and evidence are relaxed to make it a shorter and more cost-efficient process. An attorney or retired judge, who wo

By Jeffrey M. Haber In December 2016, UBS lost an $18.5 million arbitration brought by two former clients, a husband and wife, in connection with the sale of closed-end funds that were concentrated in Puerto Rican bonds. The controversy arose in the wake of the collapse of the island’s bond market in 2013 during which time UBS allegedly increased the local demand for the bonds artificially and misled the clients about the potential risks associated with the investments. In 20

By Jeffrey M. Haber In a December 2016 regulatory notice to member firms, the Financial Industry Regulatory Authority (“FINRA”) announced that the Securities and Exchange Commission (“SEC”) approved amendments to Rule 12403 of the Code of Arbitration Procedure for Customer Disputes. The amended rule will increase (1) the number of arbitrators on the public arbitrator list that FINRA sends to parties during the panel selection process from 10 to 15, and (2) the number of strik

By Jeffrey M. Haber Previously, this Blog wrote about the importance of having a complete record when challenging an arbitration award. Recently, three claimants in arbitration learned the hard way that an incomplete record will not support vacatur of an award. See Abbott v. RBC Dain Rauscher Inc., No. 1-15-1612, 2016 IL App (1st) 151612-U (Ill. App. Ct. 1st Dist. Sept. 29, 2016). The Arbitration Proceeding David, James, and Michael Abbott (“Plaintiffs”) filed a claim in arbi

By Jeffrey M. Haber Arbitration is an alternative form of dispute resolution, meaning it is an alternative to a court proceeding. In arbitration, the parties have their dispute resolved by neutral persons (known as arbitrators) knowledgeable in the areas in dispute, rather than by a judge or jury. Arbitration has been a form of dispute resolution within the securities industry for many years, primarily because it is generally considered to be faster, inexpensive and less comp

By: Jeffrey M. Haber Today’s newspapers often report stories about the perils of arbitration. In 2015, for example, The New York Times published a series of articles titled, “Beware the Fine Print” – a special report examining how arbitration clauses buried in contracts deprives Americans of their constitutional rights. (Silver-Greenberg & Corkery, In Arbitration, a Privatization of the Justice System, N.Y. Times (Nov. 1, 2015).) According to the California Assembly Committee