Lerner Loses the First Apple REIT Arbitration
On Monday, a Financial Industry Regulatory Authority (“FINRA”) arbitrator ruled in favor of customers, Joseph Graziose and Florence Hechtel (collectively “Customers”), and ordered David Lerner Associates, Inc. (“Lerner”) to pay them one-hundred cents on the dollar for the Apple REIT Nine they purchased from Lerner. The Customers were ordered to return the Apple REIT Nine to Lerner in exchange for the payment.
This is the first Apple REIT case against Lerner to go to an arbitration hearing. In their claim filed last November, the Customers alleged that Lerner made misrepresentations and omissions concerning Apple REIT Nine and requested compensatory damages in the amount of $24,450. The FINRA arbitrator awarded the Customers the full $24,450 requested, but he denied their request for punitive damages and attorney’s fees.
FINRA filed an enforcement action against Lerner in 2011 concerning Apple REITs. According to FINRA’s pending complaint against Lerner, between April and November 2011, Lerner made false and exaggerated claims regarding the investment returns, market values and performance of Apple REITs to over 1,000 potential investors during at least four investment seminars.
FINRA claims that, since 1992, Lerner has sold almost $7 billion worth of Apple REITS which generated approximately $600 million in sales commissions to the firm.
Investors nationwide who have suffered a loss as a result of an investment in Apple REITs, and who may have a FINRA arbitration claim, may contact the Florida securities lawyers at Rabin Kammerer Johnson for a free and confidential consultation by calling toll free at 877.915.4040.