Cour Strikes Class Action Ban in Arbitration Agreement

Class action bans in arbitration agreements have always been a cause for concern, and I have always taken the position that such bans are illegal. While some clever attorney had the idea to jam that sentence into an arbitration agreement, the ban has nothing to do with arbitration, and is in reality a complete ban on anytype of dispute resolution in some circumstances.

The reality is that there is nothing to get in an  uproar about, since the bans are illegal. The latest decision striking the class action ban was yesterday, in the Federal District Court in Seattle, when the court refused to enforce ATT's ban on its customer's participation in class actions.

Class action by ex-AT&T Wireless customers allowed

Single-Regulator Plan for Banks Now Close

Here we go. Not only more rules, more laws, more regulations, but yet another layer of regulation. I don't do banks, but if this is happening on the banking side, I can't wait to see what they do with the securities side.

http://online.wsj.com/article/SB124347634088461159.html#mod=rss_whats_news_us

SEC Charges Brokers with Unauthorized Trading in Customers' Accounts

The SEC is still hard at work - they filed a complaint alleging that a broker-dealer engaged in a fraudulent scheme by entering tens of millions of dollars of unauthorized securities trading through the accounts of two customers.

More at SEC Charges Brokers with Unauthorized Trading in Customers' Accounts

Judge Sotomayor's Securities Law Opinions

Professor Black has collected Judge Sotomayor's securities law opinions from her time on the Second Circuit. I have not read them all, but for those who are interested - Judge Sotomayor's Securities Law Opinions

Sotomayor’s Appellate Opinions Are Unpredictable,

Judge Sonia Sotomayor has authored some 150 civil and business cases and voted on hundreds more. But legal scholars who have examined her record closely say that her opinions in this field are unpredictable, and do not put her clearly in a pro- or anti-business camp.

The NYT has a summary of some of her decisions.

Santander, a Madoff Feeder Pays the Trustee

Banco Santander is paying the Madoff Trustee 235 million dollars to settle claims against it, according to the WSJ.

Feeder funds - hedge funds who sent investments to Madoff in return for a share of the fees came to the forefront of the Madoff litigation once it became clear that Madoff didn't have the 17 or 20 or 50 billion dollars.

Santander is the first to fold. Watch for the rest follow.

Santander, a 'Feeder,' Pays a Price - WSJ.com

Sotomayor Has Long Record of Securities and Business Cases

It is not a surprise that Judge Sotomayor has decided a large number of securities and business cases - she has been a federal judge in the Southern District of New York, and the Second Circuit, for 18 years. Those two courts are undoubtedly the #1 district court and the #1 federal appellate court for business and securities disputes in the country.

It will be interesting to see if commentators can divine anything from her past rulings and project her impact on the Supreme Court. According to those who have the time to do such studies, she does not appear to be either particularly liberal or conservative on business issues

Reuters has some preliminary material in its article. Thanks to Securities Docket for pointing it out to us.

RIA Regulation Expected to Increase RIA Costs by 20%

It is not clear how this was calculated, but an increase in compliance costs because of new regulation is nearly a given.

RIAs need to start looking for new regulatory and compliance personnel...and some attorneys as well. Remember that the SEC's aborted attempt to regulate hedge fund managers significantly boosted the compensation of experience compliance officers.

Expect more of the same in the coming months.

http://before-you-invest.com/sec-finra-might-coordinate-efforts-study-forecasts/

Soak the Rich, Lose the Rich

Completely off topic, but a great analysis of the unintended effects of soaking the rich with tax increases.

http://online.wsj.com/article/SB124260067214828295.html#mod=djemEditorialPage

The Billable Hour Debate

With increasing frequency we are seeing discussion of how bad billing by the hour is. While these discussions harp on misunderstandings, and often an extremely negative view of attorneys, they also simply ignore the benefits of billing by the hour.

This article at Law.com takes the other side, and while not really the defense of the billable hour, it does a great job of examining different hourly rates, and why they are they way they are.

Law.com - In Defense of the Billable Hour: Bad, or Just Misunderstood?