The Train Leaves the Station for One Tardy FINRA Customer Claim

May 13, 2011

In a Financial Industry Regulatory Authority ("FINRA") Arbitration Statement of Claim filed in March 2010, Claimant alleged various causes of action including breach of fiduciary duty and fraudulent misrepresentation relating to her claim that:

from 1995 through 1998 Hardies recommended that Claimant sell all of her liquid assets in order to purchase six Baron real estate limited partnerships.

Claimant sought at least $300,000 in damages plus attorneys' fees, costs, and other relief. In the Matter of the FINRA Arbitration Between Evelyn Kesler, Individually and In her capacity as Trustee of the Evelyn Kesler Revocable Living Trust, Claimant, vs Sigma Financial Corporation and Robert Hardies, Respondents (FINRA Arbitration 10-01093, May 6, 2011).

SIDE BAR: The disputed sales occurred from 1995 through 1998, which was about 13 to 15 years before the claim was filed.  How old is over a decade's worth of time? Let's see.

  • 1995: O.J. Simpson was found Not Guilty.
  • 1996: The Taliban seized Kabul.
  • 1997: O.J. Simpson was found liable in a civil lawsuit.
  • 1998: Bill Clinton denies having sexual relations with Monica Lewinsky. 

Yeah, time flies.

Respondents denied the allegations and asserted various affirmative defenses.

Motion to Dismiss

In January 2011, the Respondents filed a Motion to Dismiss, which the FINRA Arbitration Panel granted in April 2011.  Pursuant to FINRA Rule 12206, the FINRA Panel dismissed the Claim with prejudice and offered the following explanation:

The claim set forth in Claimant's Statement of Claim is not eligible for submission to arbitration under the Code because more than six (6) years have elapsed from the occurrence or event giving rise under the claim.

SIDE BAR: Note, the case was not decided on the basis of a lapsed Statue of Limitation - which is a separate legal issue. Here, the issue was that the matter was deemed ineligibleunder FINRA's Code of Arbitration.

For a more in-depth discussion of this issue, see: You Snooze, You Lose - FINRA Arbitration Deemed Too Old to Proceed(, August 2, 2010).