As an introduction, I am a retired military trial and appellate judge. I also retired as a state Worker's Compensation judge and now practice part-time as an Arbitrator. I teach CLE courses for attorneys and insurance agents on Alternate Dispute Resolution. I have been an NASD Arbitrator since 1997.
Additionally, this matter was briefly discussed at a recent PBI CLE course on Prosecuting and Defending Claims Against Stockbrokers. My reading of the discursion was that no one favored the proposed rule.
I am against this change for the following reasons:
One- it raises a larger potential for appeal. This will encourage more litigation and result in more expense and costs.
Two- My understanding is that an Arbitrator comes in to an arbitration with what he/she has in their head and if you are not clear about the law, you ask the attorneys to brief the point. I don't like the idea of writing decisions without research, even though the proposed rule states that legal authority and computation of damages need not be shown. Most often it is the computation of damages that the claimant is most concerned about (e.g. How did they reach that figure?) As written the Rule will do nothing to answer that very important question.
Third - Writing a decision can't really be done by committee. Someone must do the work and then the others can critique or change it. The idea of paying everyone the same fee doesn't seem right to me. Additionally, what if none of the members volunteers to draft an opinion? What happens then? Perhaps the request might be required on filing, and NASD could offer the prospective Arbitrators the option of declining to sit on such a case. Additionally such a rule would substantially increase the
workload of already overburdened staff attorneys.
Fourth- This seem like a PR move for claimants, that in most cases will not answer the main question. It may well receive a formula type of decision.e.g. " While the claim alleges churning, Claimant has not met his burden of proof'"or "the Claimant proved his claims of A,B,C, and D and is awarded "X"dollars."While it may be the spirit of the rule for the Arbitrators to write the decision, the rule does not prohibit (and thus may allow) Arbitrators to ask counsel to file proposed findings of fact and conclusions of law.
I believe NASD has a good and fair system and the proposed rule would burden it for very little real progress. It is up to counsel to explain the process and the decision to their client. A decision may well be a two edged sword and reflect criticism of counsel's tactics. e.g.
Claimant presented no (credible) evidence on "X", thereby engendering more problems.
Respectfully submitted,
Jack M. Marden, Esq.
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