Mom, Sister-In-Law, Two Brothers, and Stock Proceeds

May 6, 2016

In celebration of this Sunday's Mother's Day, the Blog presents a recent FINRA arbitration involving a maternal matter. Among the cast of characters are a mother, her two sons, and a sister-in-law; and, just to make things interesting, let's toss in the proceeds from the redemption of mom's stock.  Nothing like a chunk of change disputed among siblings to set off a round of internecine warfare.

Case In Point

In a Financial Industry Regulatory Authority ("FINRA") Arbitration Statement of Claim filed in September 2015, Claimant Schirtzinger, representing himself pro se, asserted negligence, fraud, breach of fiduciary duty, and misrepresentations/non-disclosures in connection with the issuance of a check to his mother by Respondent Putnam. Claimant sought unspecified damages, fees, and costs. In the Matter of the FINRA Arbitration Between Joseph M. Schirtzinger, Claimant, vs. Putnam Retail Management Limited Partnership, Respondent (FINRA Arbitration 15-02272, May 3, 2016).

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

Mom, Brother, and Sister-in-Law

I could try - I mean, you know, I could give it one helluva shot but, frankly, I don't think anything that I could say by way of characterizing Claimant's claims could do any better than the synopsis offered in the FINRA Arbitration Decision:

The causes of action related to Claimant's allegation that Putnam Investors Services, Inc. ("Putnam") issued a check to Claimant's mother due to a request for redemption of stock by Claimant's brother and sister-in-law. Claimant alleged that the check was deposited into a bank account registered in the name of Claimant's mother and Claimant's brother, who was the power of attorney for their mother. Claimant asserted that his brother then wrongfully withdrew the funds.

Motion to Dismiss

After having conducted a hearing on Respondent's Motion to Dismiss, the FINRA Arbitration Panel granted the motion. In setting forth their rationale, the arbitrators explained that:

1. Claimant pleaded no facts to constitute his having been or currently being a customer of Respondent, or having been or being the legal representative of a customer of Respondent;

2. Claimant pleaded no facts indicating that Respondent was associated with the account(s), security(ies), or conduct at issue within the meaning of applicable FINRA Rules; and

3. Claimant pleaded no facts indicating that FINRA has jurisdiction over the dispute within the meaning of applicable FINRA Rules, or that the claim is subject to arbitration under FINRA's Code of Arbitration.

Bill Singer's Comment

Just because Claimant didn't prove that:
  • he was a customer of Respondent Putnam:
  • he was the legal representative of the mother;
  • there was any connection between the accounts/securities/conduct at issue and the Respondent; and
  • FINRA had jurisdiction over the dispute,
this Panel of picky arbitrators goes ahead and dismisses the arbitration. I mean, geez, what's a guy gotta do to win an arbitration these days? Keeping with the spirit of Mother's Day, you think the Schirtzinger family is talking to each other after this lawsuit?

Tie your Mother down
Tie your Mother down
Take your little brother swimmin'
With a brick (that's all right)