NASAA Battles Over Mandatory Arbitration and Class Actions

The North American Securities Administrators Association filed an amicus brief supporting FINRA's efforts to overturn a decision by a FINRA hearing panel that allowed Charles Schwab Company to prevent its customers from participating in class-action lawsuits.

Similar briefs were filed by the Public Investors Arbitration Bar Association ("PIABA"), and, jointly, by AARP, the National Consumer Law Center and Public Justice in support of FINRA's efforts.

Separately, on May 3, 2013, NASAA wrote to SEC Chair Mary Jo White urging her to use the authority granted to the agency in Section 921 of the Dodd-Frank Act to prohibit or impose limits on the use of mandatory arbitration clauses in broker-dealer and investment adviser customer contracts.

Click here to view NASAA's amicus brief (links externally to NASAA website).See also: NASAA President Abshure Remarks on JOBS Act and Mandatory Arbitration (with Lofchie Comment).See also: Arbitration Clauses in Customer Agreements (Law360 Article by Brad Bondi and Jason Halper).