Facts

Claimants Dennis Nigro and others alleged breach of contract, breach of fiduciary duty, unsuitability, unauthorized trading, churning, misrepresentatoin of material facts, violation of NASD and NYSE rules, and failure to supervise. The claims involved transactions in certain securities.

Respondents Mutual Service Corp. and others denied the claims filed against them. They set forth various affirmative defenses.

Damages

Claimants sought $2,000,000 in compensatory damages and interest. They also sought attorney fees, costs, expert fees, and punitive damages. Respondents sought dismissal of the statement of the claim in its entirety plus costs.

Result

The panel decided : 1) Respondents Mutual Service Corp., Charles Leitzke and Leonard Voisen are jointly and severally libale to and shall pay claimants $200,000 in compensatory damages; 2) Respondents are jointly and severally liable to and shall pay claimants simple interest in the amount of six percent per annum on $200,000 from June 30, 2005 until payment of this award is made in full; 3) Respondent Michael Poston is liable to and shall pay claimants $50,000 in compensatory damages; 4) Respondent Poston is liable to and shall pay claimants simple interest in the amount of six percent per annum on $50,000 from June 30, 2005 until payment of this award is made in full; 5) Claimants are jointly and severally liable to and shall pay respondents Mutual Service, Leitzke and Voisen sanctions in the amount of $5,000; 6) All other relief requested and not expressly granted is denied.

Other Information

In August 2006, claimants filed a motion for leave to file a motion for summary adjudication, which the panel denied. In December, respondents filed an emergency motion for sanctions, asserting that claimants had violated a discovery order. The claimants were subsequently ordered to pay respondents $5,000 in sanctions. However, the panel denied respondents' motion to cnduct a final hearing session and granted claimants' request for correction of the award. A petition has been filed with the San Diego Superior Court to correct, vacate or confirm the award. ARBITRATORS: James J. Dobbin, Esq. and Ronald O. Bub, Sr.