Readers will recall the Georgia Superior Court decision vacating an arbitration award in favor of respondent Wells Fargo Clearing Services, LLC. which found that the arbitrator selection process was manipulated in that case.
Quite honestly, the facts set forth in the decision didn’t make much sense. The court accused FINRA and the attorney of having an agreement to exclude two arbitrators from cases where that particular attorney represented a party because of some sort of dispute between the attorney and those two arbitrators.
FINRA denied the existence of such an agreement, as did the attorney. And the fact is there is simply no need to do that. Parties have the right to strike arbitrators from the selection lists, for any reason, or no reason. In addition, any party can move do have an arbitrator removed for cause.
The decision caused an uproar, with Claimant’s attorneys and politicians screaming about the unfairness of the process. In response, FINRA hired Lowenstein Sandler as independent counsel to provide an independent review and analysis.
Lowenstein found that there was no agreement between the attorney and FINRA, and that “After careful consideration of the evidence obtained during that review, Lowenstein does not believe that there was any agreement between Weiss and FINRA regarding the panels for Weiss’s cases, and “The evidence further demonstrated that FINRA personnel generally adhered to the policies and procedures and that their actions during the [relevant arbitration] were intended to be fair and reasonable at each step.”