In a FINRA Arbitration Statement of Claim filed in August 2009, Claimant Wells Fargo Advisors asserted causes of action for breach of a promissory note dated January 8, 2007 (the "Note") and overpayment of commissions to Respondent Shawn Newman. Claimant Wells Fargo ultimately sought $57,486.49 in principal and interest, and $14,371.62 for attorneys' fees and FINRA costs. In the Matter of the Arbitration Between Wells Fargo Advisors, LLC f/k/a Wachovia Securities, LLC,. Claimant vs. Shawn Colin Newman, Respondent (FINRA Arbitration 09-04824, December 2, 2010).
Respondent Newman represented himself pro se, generally denied the allegations, and filed a Counterclaim for breach of contract and wrongful termination. Respondent ultimately sought full forgiveness of the loan and taxes thereon; an expungement of the arbitration from his CRD record; and an award against Claimant for payment of $166,000 in lost wages. Prior to the conclusion of the arbitration hearing, Respondent Newman withdrew his claim of employment discrimination .
FINRA Arbitrators Rule
The FINRA Arbitration Panel denied Claimant Well Fargo's claim on the Note. Also, the Panel denied the claim for overpaid commissions and pointedly noted that Claimant Wells Fargo did not present evidence or arguments relating to its initial claim for overpayment of commissions in the amount of $3,906.49.
However, the Panel also denied Respondent Newman's Counterclaim for $166,000.00 in lost wages and expungement.
Bill Singer's Comment: You ever watch a football game where your team appears to have scored a touchdown; however, as part of that scoring play, the running back fumbled the ball somewhere before, on, or past the plane of the goal line. To make matters worse, the other team recovered the ball. So, for starters, either your team scored or it fumbled away the ball.
Meanwhile, as you're trying to figure out exactly where the ball was when it was fumbled, you learn that there are two flags on the play -- late ones. One penalty is against the offense for holding, and the other penalty is against the defense for being off-sides.
After a brief huddle, the referee rules that the penalties are offseting and it's the same down at the same yard line.
And then the home team runs another play and gets stuffed short of the goal line. Game over.
Well, that's about what happened in this arbitration.
For starters, you really have to wonder what kind of case Claimant Wells Fargo had -- or thought it had -- that convinced it to try and run this one in against Respondent Newman. Maybe the employer should have settled for a field goal or punted? Even though Newman's claims were dismissed by the Arbitration Panel, he didn't file the initial Statement of Claim that started the whole mess. In my eyes, he emerges as the clear winner in this dispute.
Without question, things went terribly wrong here for the former employer Wells Fargo. Not only did Claimant Wells Fargo apparently fumble the ball and lose the case, but, to make matters worse, it was stripped of the ball by a pro se litigant. Losing to a skilled arbitration lawyer is one thing -- but to lose to an unrepresented former employee...ouch! Worse, the Arbitration Panel's somewhat snarky comment about the lack of evidence (or even the lack of an argument) by Wells Fargo on behalf of its claimed overpaid commissions suggests that Claimant may have been a tad overconfident about how easy it would be beat Respondent Newman.
Then again, did anyone watch the entire New York Jets game last Sunday against the Miami Dolphins?
Of course, who the hell really knows what did or didn't happen at this arbitration. The official FINRA Arbitration Decision is the typical brief he-said, she-said, and we-find report, so maybe I'm reading too much into things. Nonetheless, it's quite a stunning victory when a pro se former employee puts on a winning goal line defense against his former employer (particularly when that former firm was the powerful Wells Fargo).