Federal Court Grants Summary Judgment in Favor of Rabin Kammerer Johnson in FINRA Case
Rabin Kammerer Johnson announces the favorable conclusion of a recent Financial Industry Regulatory Authority (“FINRA”) case, Money Concepts Capital Corp. v. Alan Schryer, Case No. 17-CV-80922, filed in the United States District Court for the Southern District of Florida.
The case was filed in the Southern District of Florida against the firm’s client after a FINRA arbitration panel concluded that the FINRA arbitration between Money Concepts and Schryer should proceed in Los Angeles, California. Schryer, a registered representative of FINRA, was employed by Money Concepts in California. The employment agreement between Money Concepts and Schryer, however, provided that any disagreement between the parties “shall be determined by arbitration in Palm Beach County, Florida in accordance with the rules and regulations as promulgated by the National Association of Securities Dealers, Inc.”
After Schryer left employment with Money Concepts, a dispute arose between the two parties and Schryer filed a FINRA arbitration claim in Los Angeles, California, pursuant to the FINRA rules, previously known as the National Association of Securities Dealers rules. Money Concepts disagreed that the arbitration should proceed in California and requested that FINRA transfer the arbitration to Florida pursuant to Schryer’s pre-dispute employment agreement. The FINRA arbitration panel held a hearing and heard oral argument on Money Concept’s request, but ultimately denied the request and ordered that arbitration proceed in Los Angeles. Disagreeing with the FINRA arbitration panel’s interpretation of Schryer’s pre-dispute employment agreement, Money Concepts filed a petition in the Southern District of Florida asking that the Court stay the FINRA arbitration in Los Angeles and compel arbitration in Palm Beach County, Florida.
In its motion for summary judgment, Money Concepts claimed that the forum selection clause in the employment agreement was unambiguous, and therefore the FINRA arbitration panel disregarded the clause in determining that arbitration should proceed in Los Angeles. In response, Rabin Kammerer Johnson argued on behalf of Schryer that, according to recent Eleventh Circuit case law, disputes over the forum selection clauses in arbitration agreements are procedural questions for the arbitrator to decide. Because the FINRA arbitration panel was briefed on the forum selection issue and heard oral argument on it, Schryer claimed that the panel arguably interpreted the clause, to which interpretation the Court should defer.
In granting summary judgment for Schryer, the Court held that when the arbitrator even arguably interprets the parties’ agreement, the arbitrator’s interpretation of a forum selection clause will not be disturbed. As the Court found, in this case, the FINRA arbitration panel arguably interpreted Schryer’s pre-dispute employment agreement when it considered, and rejected, Money Concepts’ argument that the agreement required arbitration in Florida. “The Agreement, containing the venue-selection clause, was before the Panel and was central to Plaintiff’s argument that venue was proper in Palm Beach County.” Therefore, based on the undisputed facts of the case, the arbitration panel at least arguably interpreted Schryer’s pre-dispute employment agreement.
Quoting the United States Supreme Court, the Court found that Money Concept’s argument that the arbitration panel disregarded the venue selection provision was without merit because “[t]he arbitrator’s construction holds, however good, bad, or ugly.”
Rabin Kammerer Johnson thanks Alan Schryer for trusting the firm to handle his case and looks forward to working on more FINRA cases in the future.
