Stockbroker Wins Arbitration For Owed Commissions And Expenses

December 14, 2012

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In a Financial Industry Regulatory Authority ("FINRA") Arbitration Statement of Claim filed in October 2011, Claimant Paul alleged that before and after his separation from employment, Respondent Allegiant Securities had failed to pay to him commissions that he had earned and had failed to reimburse expenses. Claimant ultimately sought $43,954.74 in compensatory damages plus interest, attorneys' fees, and costs. In the Matter of the FINRA Arbitration BetweenRichard W. Paul, Claimant, vs Allegiant Securities, LLC, Respondent (FINRA Arbitration 11-03915, December 7, 2012).

Respondent generally denied the allegations, asserted affirmative defenses, and filed a Counterclaim seeking $50,000 in compensatory damages plus fees and costs. Respondent, Allegiant Securities, LLC, did not file an executed Uniform Submission Agreement or appear at the final arbitration hearing but, nonetheless, having filed an Answer was bound by the decision.

A Moving Experience

Starting in December 2011, the parties embarked upon a prodigious exchange of motions, dueling motions, and the like:

  • Claimant: December 23, 2011: Notice of Default
  • Respondent: January 18, 2012: Motion to Deny Claimant's Motion for Default and/or Bar Affirmative Defenses
  • Claimant:February 6, 2012: Response to Respondent's Motion to Deny Claimant's Motion for Default and/or Bar Affirmative Defenses and a Motion to Strike Respondent's Pleadings
  • Respondent: February 14, 2012: Motion to Deny Claimant's Motion to Strike Respondent's Pleadings

RULING: Around April 2, 2012, the sole FINRA Arbitrator hearing this matter entered an Orderdenying Claimant's Motion to Strike Respondent's pleadings.

  • Respondent: January 13, 2012: Motion to Change Hearing Location
  • Claimant: January 31, 2012: Response to the Motion to Change Hearing Location
  • Claimant: April 1, 2012: Supplemental Response to the Motion to Change Hearing Venue
  • Respondent: April 13, 2012: Supplement to the Motion to Change Hearing Venue

RULING: Around June 8, 2012, the Arbitrator denied Respondent's Motion to Change Hearing Venue.

  • Claimant: October 29, 2012: Motion for Default Judgment and/or Sanctions for Failure to Comply with the Arbitrator's Order

RULING: Around November 29, 2012, the Arisitrator entered an Order denying Claimant'sMotion for Default Judgment to the extent that it asked for an award, but granting Claimant'sMotion for Default Judgment insofar as Respondent was prevented from introducing evidence by items that were ordered to be produced in the Arbitrator's previous October 7, 2012, Order.


The sole FINRA Arbitrator hearing this case found Respondent Allegiant Securities, LLC, liable to and ordered it to pay to Claimant Paul:

  • $43,954.74 in compensatory damages plus 6% interest from October 3, 2011 through December 3, 2012;
  • $8,000.00 in costs as a sanction pursuant to Rule 12212 of the Customer Code of Arbitration Procedure for not following Arbitrator's Discovery Order of October 7, 2012, and for the failure to appear at hearing; and
  • $150 in reimbursed filing fees

Bill Singers Comment

Ah yes, the trench warfare of Wall Street and its stockbrokers: The static line between owed and unpaid commissions and feesMerrill LynchWells FargoUBS. Goldman Sachs, Morgan Stanley. JP Morgan. Pick a firm. Any firm. Pick a day. Any day. You got yourself a lot of yelling and screaming about what a broker is owed, what the employing firm says is owed, and then a whole batch of threats about what's going to happen if the check isn't cut.