April 14, 2008
Re: SR-FINRA-2008-005 - Proposing Revisions to NASD Rules Regarding Procedure to Permit Submissions to Arbitrators After a Case Has Been Closed
Thank you for the opportunity to comment on the Rule Proposal of FINRA to amend NASD Rules 12905 and 13905, regarding procedures for filing submissions to arbitrators after a case has been closed. As an attorney who exclusively focuses on representing public investors, especially those in FINRA arbitration, I ask that the SEC and FINRA reject these proposed amendments.
One of the stated purposes of the rule is to reduce attorneys fees and other costs associated with responding to such submissions. Unfortunately, I believe the consequences of this rule would be to the contrary. If approved, this rule would codify a procedure for parties to argue over ministerial matters and would essentially justify such conduct, even if such filings would otherwise be unethical and litigious. This would create additional legal expense for all parties involved.
The rule also encourages parties to correct technical or mathematical errors in their awards. Again, this rule opens the door for parties to re-litigate issues related to damage calculations in the awards and would appear to increase legal expenses for claimants and respondents alike. A party who is not satisfied with the award would view this rule as a means to re-open the arbitration process and give them a second shot at stating their case.
Although the proposed rule has good intentions, I believe that contrary consequences would result. For those reasons, I hope the SEC and FINRA would reject this proposed rule.