Friday, February 5, 2016

Federal Court Says You Can Waive FINRA Arbitration

Firms can force employees to waive FINRA rules and arbitrate before a private arbitrator.

We have held in several cases that an SRO's arbitration provisions are default rules which may be overridden by more specific contractual terms. See, e.g., Ameriprise Fin. Servs., Inc. v. Beland (In re Am. Express Fin. Advisors Secs. Litig.), 672 F.3d 113, 132 (2d Cir. 2011) ("In particular, as relevant here, different or additional contractual arrangements for arbitration can supersede the rights conferred on a customer by virtue of a broker's membership in a self-regulating organization such as FINRA.") (alterations and quotation marks omitted).

'CREDIT SUISSE SECURITIES (USA) LLC v. Tracy, Court of Appeals, 2nd Circuit 2016
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