Lehman Suffers First Loss in FINRA Arbitration Collection of Promissory Notes

October 12, 2011

In a Financial Industry Regulatory Authority ("FINRA") Arbitration Statement of Claim filed in October 2010, Claimant Lehman sought to recover $176,000 in compensatory damages plus interest, costs, and attorneys' fees arising in connection with the alleged breach of promissory note and contract by its former employee, Respondent Mitchell .  At the close of the FINRA arbitration hearing, Claimant Lehman amended its compensatory damages claim to $259,084.12. In the Matter of the FINRA Arbitration Between Lehman Brothers Holdings, Inc., as assignee of Lehman Brothers, Inc., Claimant, v. Jennifer Lorenc Mitchell, Respondent (FINRA 10-04569, October 11, 2011)

Respondent Mitchell generally denied the allegations and asserted various affirmative defenses. 

The sole FINRA arbitrator hearing this matter denied Claimant's claims in their entirety. 

SIDE BARBut Bill, you ask, what are the details to this case?  Why did Respondent Mitchell prevail?

Alas, in keeping with the nature of FINRA Arbitration Decisions, I've reported to you all the substantive facts that were presented in the Decision.  As to the Panel's rationale for kicking Lehman to the curb - what can I tell you?  It would have been nice for some meaningful guidance in the Decision but there is none.  On the other hand, Respondent Mitchell is likely more than thrilled at the favorable ruling, even in the absence of details.

Bill Singer's Comment

To the best of my knowledge this is the first defeat that Lehman has suffered in furtherance of its post-bankruptcy efforts to recoup various promissory notes that were extended to former employees. Reduced to its basics, Lehman came, it saw, and it got its head handed to it.  Respondent Mitchell was represented by David E. Robbins, Esq. of Kaufman Gildin Robbins & Oppenheim LLP.

For more details about the Lehman note collection effort, READ:

High Noon for 113 Former Lehman Employees (Street Sweeper, February 15, 2011)

Lehman Seeks To Collect Unpaid Loans From Furious Former Employees (Street Sweeper, November 19, 2010)



On November 14, 2011, Bill Singer will be the afternoon's Keynote Speaker at the Fall Symposium of the National Association of Independent Broker Dealers ("NAIBD").  Bill's appearance is scheduled for 2:30 - 3:15 PM at Bayard's in New York City. 

For information about this day-long event, VISIT