2. Plaintiff claims that his Complaint in this instant matter "contained a certification pursuant to R. 4:5-1 which identified inter alia that the matters in controversy were the subject of two pending actions in the Appellate Division and one recently -- concluded arbitration under the auspices of the Financial Industry Regulatory Authority, Inc. ("FINRA").3. Plaintiff makes reference to the matters in the Appellate Division without any indication what those claims are about or how they are relevant to the within matter.4. On March 24, 2015 Plaintiff contends that he filed a motion to extend time to file and serve an amended complaint. On April 10, 2014 this Court denied Plaintiff s motionindicting [sic] on the Order,
Case was dismissed for lack of prosecution on 3/27/2014. A motion to extenddiscovery when no answer has been filed is improper. Movant has yet to file an Affidavit of Service and his telephone call to the Clerk does not suffice to protect his rights. Accordingly, the motion is denied and the matter remains dismissed.
SIDE BAR: FINRA Rulebook:FINRA By-Laws Article VI, Section 3: Suspension or Cancellation(a) The Corporation after 15 days notice in writing, may suspend or cancel the membership of any member or the registration of any person in arrears in the payment of any fees, dues, assessments, or other charges or for failure to furnish any information or reports requested pursuant to Section 2.(b) The Corporation after 15 days notice in writing, may suspend or cancel the membership of any member or suspend from association with any member any person, for failure to comply with an award of arbitrators properly rendered pursuant to the Corporation's Rules, where a timely motion to vacate or modify such award has not been made pursuant to applicable law or where such a motion has been denied, or for failure to comply with a written and executed settlement agreement obtained in connection with an arbitration or mediation submitted for disposition pursuant to the Corporation's Rules.FINRA Rule 9554: Failure to Comply with an Arbitration Award or Related Settlement or an Order of Restitution or Settlement Providing for Restitution(a) Notice of Suspension or CancellationIf a member, person associated with a member or person subject to FINRA's jurisdiction fails to comply with an arbitration award or a settlement agreement related to an arbitration or mediation under Article VI, Section 3 of the FINRA By-Laws or a FINRA order of restitution or FINRA settlement agreement providing for restitution, FINRA staff may provide written notice to such member or person stating that the failure to comply within 21 days of service of the notice will result in a suspension or cancellation of membership or a suspension from associating with any member. When a member or associated person fails to comply with an arbitration award or a settlement agreement related to an arbitration or mediation under Article VI, Section 3 of the FINRA By-Laws involving a customer, a claim of inability to pay is no defense.. . .(g) Request for Termination of the SuspensionA member or person subject to a suspension under this Rule may file a written request for termination of the suspension on the ground of full compliance with the notice or decision. Such request shall be filed with the head of the FINRA department or office that issued the notice or, if another FINRA department or office is named as the party handling the matter on behalf of the issuing department or office, with the head of the FINRA department or office that is so designated. The appropriate head of the department or office may grant relief for good cause shown.
Respondent is suspended from associating in any capacity with any FINRA member firm for his failure to pay an arbitration award. The suspension will automatically convert to a bar if he fails to provide sufficient documentary evidence to FINRA Regulatory Operations within 30 days after the date of this decision, showing: (1) he paid the award in full; (2) he entered into a written settlement agreement with Wells Fargo, and he is current in his obligations under the terms of the settlement agreement; or (3) he filed a bankruptcy petition in U. S. Bankruptcy Court pursuant to Title 11 of the United States Bankruptcy Code and the case is pending before the Bankruptcy Court (or the Bankruptcy Court has discharged the debt representing the award)
appears to impose sanctions on a basis that is inconsistent with the rationale we have articulated for reviewing suspensions imposed for failure to pay arbitration awards under the Section 19(f) standard. Unlike in other arbitration cases we have reviewed, the hearing officer imposed a suspension that automatically converted into a bar. The hearing officer's decision suggests that he did so to sanction Sequeira for conduct inconsistent with just and equitable principles of trade. These factors support a conclusion that the hearing officer considered the sanction to be disciplinary in nature and necessary to sanction Sequeira for misconduct rather than designed to influence Sequeira to comply with the arbitration award.
We are reluctant, however, to resolve the issue of the standard of review based on the record before us. Where FINRA does not clearly explain the bases for its conclusions and the sanctions it imposes, "we cannot discharge properly our review function" and remand is appropriate. So too here. In his decision, the hearing officer addressed the basis for the suspension and bar only in passing in a brief footnote. And although the hearing officer provided that the suspension would convert to a bar if certain events did not happen within 30 days of his decision, he did not discuss whether either the suspension or bar would terminate automatically upon the occurrence of those events. The hearing officer thus failed to clearly explain the precise terms of the sanction and the basis for it.
Respondent is suspended from associating in any capacity with any FINRA member firm for his failure to pay an arbitration award. The suspension shall continue until he provides sufficient documentary evidence to FINRA showing that: (1) he paid the award in full; (2) he entered into a written settlement agreement with Wells Fargo, and he is current in his obligations under the terms of the settlement agreement; or (3) he filed a bankruptcy petition in U. S. Bankruptcy Court pursuant to Title 11 of the United States Bankruptcy Code and the case is pending before the Bankruptcy Court (or the Bankruptcy Court has discharged the debt representing the award).
Article VI, Section 3(b) of FINRA's By-Laws provides in pertinent part that FINRA may, upon written notice, suspend the registration of an associated person who fails to comply with an arbitration award when the person has not made a timely motion to vacate or modify the award, or when such a motion has been denied.In the expedited hearing of this matter, Sequeira conceded that the New Jersey court dismissed the suit he filed to vacate the award. Nonetheless, he insisted that the dismissal did not adjudicate the merits of his claims, and therefore the suit he had filed was still "pending" before the court.
The purpose of this decision is to make clear that the sanction imposed is not disciplinary in nature, but, consistent with other expedited proceedings instituted under FINRA Rule 9554, is "designed to influence Sequeira to comply with the arbitration award." Therefore, the sanction is modified as set forth below.
Bill Singer's CommentIn sum, we find that the specific grounds on which FINRA based Sequeira's suspension exist in fact, that the suspension was imposed in accordance with FINRA's rules, and that those rules are, and were applied in a manner, consistent with the purposes of the Exchange Act. Accordingly, we dismiss Sequeira's application for review.