Gibbons has represented broker dealers and their officers, directors, and registered personnel in numerous litigation, arbitration, regulatory, and enforcement proceedings involving federal securities laws and regulations, various state statutory “Blue Sky” laws, and common law claims arising from securities transactions.
Areas of Focus
Customer Litigation and Arbitration Proceedings
We represent broker dealers before state and federal courts nationwide in matters arising out of initial public offerings, secondary market transactions, private placements, corporate mergers and acquisitions including hostile tender offers, negotiated stock sale agreements, and going private “freeze out” merger transactions. In addition, we have also represented broker dealers in various arbitration proceedings venued before such self regulatory bodies as the New York Stock Exchange, Chicago Board Options Exchange, and other private arbitration and mediation services, such as the American Arbitration Association. The types of claims in these arbitration matters include customer complaints regarding issues of suitability, unauthorized trading, churning, and breach of fiduciary duty; customer complaints regarding claims of fraud and regulatory violations in initial offerings, secondary market transactions, and distributions; broker to broker claims regarding market making activities, execution disputes, and failures to receive and deliver; and employment discrimination and/or compensation related disputes between industry members and their registered personnel.
Regulatory Investigations and Enforcement Proceedings
Gibbons has extensive experience representing broker dealers and their registered personnel in both civil and criminal investigations and enforcement actions commenced by or on behalf of the United States Securities and Exchange Commission (SEC) and other federal and state regulatory authorities, including the United States Attorneys Office, regional stock exchanges, and district business committees of the Financial Industry Regulatory Authority, Inc. (FINRA).
Securities Investor Protection Corporation (SIPC) Proceedings
Our extensive knowledge of and experience with broker dealer operations and regulation has been recognized by SIPC, which have retained the firm as both Trustee and Trustee’s Counsel for the liquidation of various broker dealers, including Cygnet Securities, Inc.; M.S. Wein; Southeast Securities of Florida, Inc.; and Paragon Securities, Inc. In connection with these SIPC appointments, Gibbons has been responsible for the reconstruction of broker dealer operations, reconstruction of customer accounts, and determination of customer claims, including the assessment and resolution of allegations of unauthorized and unsuitable trading.
Compliance and Regulatory Counseling
In addition to our litigation services, the firm offers regulatory and compliance advice and counseling to broker dealers on various registration and compliance issues, the adequacy of compliance programs, and compliance training for employees. We also conduct compliance and regulatory audits on behalf of broker dealers in connection with merger and acquisition transactions between industry members.
The firm’s knowledge of and experience with broker dealer operations have been recognized by authorities beyond SIPC. For example, members of the firm served on the PaineWebber Direct Investments Claims Project, in which the firm was appointed by the United States District Court for the Southern District of New York to oversee the distribution of the PaineWebber Direct Investments Claims Fund, a $40 million settlement fund created by virtue of a settlement between PaineWebber and the SEC regarding the sale of limited partnership interests. In this role, we were required to develop and implement procedures for determining individual claims of misrepresentation and suitability for more than 150,000 investors who had purchased limited partnerships marketed by PaineWebber Incorporated.