From: Al Van Kampen
I am responding to the NASD's proposal to amend Rule 10322 of the NASD Code of Arbitration Procedure. I bring the perspective of 22 years of legal practice, much of it in the securities area, including the representation of customers, securities firms and brokers in arbitrations, and that of a NASD arbitrator.
The amendment provides some benefits to the process in requiring a 10 day notice period, which is a practice followed by most NASD offices even now. But both the current and proposed rules allow for the issuance of subpoenas “as provided by law.” However, the arbitration codes in Washington state and most other states, and the Federal Arbitration Act, do not provide for attorney-issued subpoenas. Notwithstanding this, in reliance upon the ambiguity of the NASD rule, many parties regularly issue document subpoenas directly to private third parties, such as customers’ accountants. In my experience, the lack of clarity as what is meant by "as provided by law" leads to needless motion practice and expense arising from improper attorney-issued subpoenas to third parties. The provision for issuance of subpoenas by counsel “as provided by law” is both vague and ambiguous and should be dropped. Rather, the NASD should amend the rule to state explicitly in subsection (a) that only the arbitrators may issue subpoenas. Such an amendment also would have the added benefit of obviating any need for subsection (e) as the arbitrators already would have ruled on any objections before service of the subpoena.
I will be pleased to prove additional information or clarification if requested to do so.
Al Van Kampen