Susan Emadi v. Donald & Company Securities, Inc., Steven Varasteh, National Association of Securities Dealers, Inc.
Published: Aug. 21, 1999 | Result Date: Apr. 15, 1999 | Filing Date: Jan. 1, 1900 |Case number: 9802005 Arbitration – $91,000
Court
Case Not Filed
Attorneys
Claimant
Respondent
Experts
Claimant
Alan Rockler
(technical)
Respondent
John D. Maine
(technical)
Facts
In 1996, claimant Susan Emadi, a widowed mother who fled Iran following the Iranian revolution, opened a brokerage account at respondent Donald & Co. The claimant supported herself with income from homemade costume jewelry sales and royalties from a book she had written. The claimant had previously lost $70,000 from other brokerage accounts, and had obtained, but failed to collect, an arbitration award for the loss. The claimant opened the account with Donald & Company based on representations by respondent Steven Varasteh, a registered representative of Donald & Co. and her distant cousin. Varasteh represented that he had an incredible investment opportunity for a software company called Mustang Software. Over the next four months, the respondents sold 14,500 shares of highly speculative Mustang stock to the claimant. The stock price fell dramatically and the claimant could not make margin calls. As a result, the claimant lost $59,000. The claimant brought this action against the respondents, Donald & Co. and Steven Varasteh, based on fraud and breach of fiduciary duty (unsuitable investments) theories of recovery.
Settlement Discussions
The claimant made a settlement demand for $100,000. The respondents made a joint settlement offer of $40,000.
Other Information
The award was reached approximately eleven months after the case was filed. The arbitration was held on April 6, 1999 before Joseph Winter, Robert Granas and Thomas Doyle of the National Association of Securities Dealers. POST TRIAL MOTIONS: The claimant has filed a petition to confirm the arbitration award.
Poll
3-0
Length
two days (arbitration)
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