Former Banc of America Broker Throws Kitchen Sink in FINRA Arbitration

June 3, 2011

In a Financial Industry Regulatory Authority ("FINRA") Arbitration Statement of Claim filed in February 2010, Claimant Carvajal asserted a kitchen's sink worth of causes of action:
  1. breach of employment agreement;
  2. breach of contract;
  3. breach of equitable and just principles of trade;
  4. fraud and deceit in the inducement of employment and signing of any promissory notes;
  5. tortious interference with advantageous business relationships;
  6. negligence and gross negligence;
  7. breach of fiduciary duties;
  8. defamation;
  9. unpaid wages; and
  10. wrongful termination.

SIDE BAR: I'm often asked by potential Wall Street clients whether we can plead this or plead that in a case involving a disputed employment termination.  The fact of the matter is that there are often a myriad of allegations that can be referenced in a given case, as this matter clearly demonstrates. 

Having laid his groundwork upon ten causes of action, not surprisingly, Claimant makes demand for an equally impressive number of damages:

  1. $1 million in compensatory and punitive damages;
  2. pre-award interest;
  3. payment of his guaranteed draw;
  4. lost future income;
  5. deferred compensation held in any deferred compensation plan(s);
  6. bonus payments;
  7. repayment of all commissions;
  8. nullification of any promissory notes;
  9. expungement of the termination language on his Form U5;
  10. attorney's fees;
  11. additional attorney's fees under Florida Statutes Section 448.08;
  12. costs;
  13. expert witness fees; and
  14. such other relief as this Panel deemed appropriate.

SIDE BAR: Section 448.08: Attorney's fees for successful litigants in actions for unpaid wages.
The court may award to the prevailing party in an action for unpaid wages costs of the action and a reasonable attorney's fee.

In the Matter of the FINRA Arbitration Between Juan Carlos Carvajal, Claimant, vs. Banc of America Investment Services, Inc., Respondent (FINRA Arbitration 10-00943, June 1, 2011).

Respondent Banc of America generally denied the allegations, asserted various affirmative defenses, and filed a Counterclaim alleging breach of contract and unjust enrichment as related to Claimant's employment and some $63,200 plus interest, attorneys' fees, and costs allegedly due to Respondent pursuant to an executed promissory note.


The FINRA Arbitration Panel found Respondent liable to and ordered it to pay to Claimant $90,000.00 in compensatory damages but pre-judgment interest was denied. Respondent was also required to pay $375.00 as reimbursement for a portion of FINRA's claim filing fee. 

The Panel ruled that the promissory note was deemed cancelled in full; and Respondent was ordered to provide to Claimant a Form 1099 for the promissory note effective for the year 2011.

Finally, Claimant was found not liable on Respondent's Counterclaim.


The FINRA Arbitration Panel recommended the expungement of the termination comment in Section 3 of Claimant Carvajal's Form U5  as filed by Respondent on October 7, 2009.  The Panel recommended the expungement of the following language:


and the Panel recommended that the expunged language be replaced with:

"Position was eliminated due to merger."
(The reason for termination should remain "Discharged.")