Securities Law Updates | New Statutes, Regulations and Rules
July 19, 2012
FINRA Launches Pilot Program for Large Arbitration Cases
Pilot Program for Large Arbitration Cases
FINRA No. ______, 7/2/2012
The Financial Industry Regulatory Authority (FINRA) has launched a pilot program specifically designed for large arbitration cases involving claims of $10 million or more. The program enables parties to customize the administrative process to better suit special needs of a larger case and allows them to bypass certain FINRA arbitration rules. Participation in the pilot program, which began today, is voluntary and open to all cases; but in order to be eligible, all parties will be required to pay for any additional costs of the program and must be represented by counsel.
Linda Fienberg, President of FINRA Dispute Resolution, said, “In response to the increasing number of very large cases, we wanted to introduce a more formal approach to give parties greater flexibility and more control over the administration of their case.”
Examples of how parties may customize the process include having the option to:
• have additional control over the method of arbitrator appointment and the qualifications of arbitrators;
• hire non-FINRA arbitrators for their case;
• develop their own procedures for exchanging information prior to the hearing;
• have expanded discovery options such as depositions and interrogatories; and
• choose from a wider selection of facilities.
All parties must agree and will be required to pay for any additional costs of the program such as costs for enhanced facilities or additional arbitrator honorariums. FINRA will send a letter to parties in cases involving claims of $10 million or more to solicit participation in the pilot.
Subscribe to Securities Law Updates
It's FREE and only takes seconds