James L. Donohue, James L. Donohue IRA, Nancy L. Donohue as Trustee of Revocable Living Trust of Nancy Donohue UAD 5/30/2000 v. Allianz Global Investors Capital LLC, Allianz Global Investors Distributors LLC, Allianz Global Investors Fund Management LLC, Bank of Montreal, E*Trade Securities LLC, Harris Investor Services Inc., ING Investments LLC, I
Published: Feb. 11, 2012 | Result Date: Dec. 30, 2011 | Filing Date: Jan. 1, 1900 |Case number: 10-04493 Arbitration – Denial
Court
FINRA
Attorneys
Claimant
Respondent
John S. Worden
(Schiff Hardin LLP)
John E. Bersin
(E-Trade Securities)
Facts
Claimants purchased Auction Rate Preferred (ARP) Security Investments from Respondents. They filed suit alleging breach of fiduciary duty, negligence, sutiability, failure to supervise, omissions of act, and misrepresentation.
Damages
Claimants requested that Respondents be required to buy back nine ARPs at $25,000 par per ARP for a total of $225,000. Claimants also requested that Respondents be order to pay costs and penalties, including attorneys fees and other equitable relief necessary to redress Respondents' violations of Illinois and Arizona or Federal law.
Result
The arbitration panel found that Peter Patrick Kelly was not a financial advisor and had not made recommendations to customers. Thus, the panel concluded that there was no sales practice violation when Claimants' order to purchase auction rate securities was executed by Kelly and denied the relief requested.
Other Information
ARBITRATORS: Donald Dreyfus, Denise Kathleen Gaines, Aryka S. Radke.
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