Broker-Dealer Litigation - Greenberg Traurig LLP

application for review of the FINRA decision but argued that extraordinary circumstances caused
the delay. The Eleventh Circuit held that the petitioner did not make a showing of extraordinary
circumstances because the facts underlying his claims of extraordinary circumstances were
discoverable either during the challenged proceedings or shortly thereafter.
Raymond James Fin. Servs., Inc. v. Phillips, 2011 WL 5555691 (Fla. Dist. Ct. App. Nov. 16,
2011).
The court held that Florida’s statutes of limitations did not apply to an NASD arbitration
where the arbitration agreement did not expressly provide for their application. The court noted
that the firm did not expressly include the Florida statutes of limitations in its contract with its
account holders and that the Florida limitations statute does not expressly state that it applies to
arbitrations. Because the court considered this issue to be of great public importance, it certified
the question to the Florida Supreme Court which has granted review (2012 WL 285100).
M.4
N. Arbitration
1. Scope
N.1
AT&T Mobility LLC v. Concepcion, 131 S. Ct. 1740 (2011).
The United States Supreme Court considered the viability of California’s Discover Bank
rule, which provided that class action waivers in arbitration agreements were unconscionable and
thus unenforceable. The contract at issue provided that the customers and the provider arbitrate
all disputes, but precluded class arbitration. The Supreme Court held that the Federal Arbitration
Act (“FAA”) preempted the Discover Bank rule on the basis that the FAA was enacted to ensure
enforcement of arbitration agreements. The Supreme Court noted that class arbitration sacrifices
many of arbitration’s advantages, including informality, and greatly increases risks to
defendants. More generally, arbitration is not an effective dispute resolution vehicle for highly
complex, high stakes class action suits. As a result, California’s rule requiring the availability of
class arbitration conflicted with the principal purpose of the FAA and was therefore pre-empted.
UBS Fin. Servs., Inc. v. W. Va. Univ. Hosps., Inc., 660 F.3d 643 (2d Cir. 2011).
The Firm appealed the dismissal of its action to enjoin the FINRA arbitration claims filed
by defendant. The original claim arose as a result of three separate offerings in which defendant
issued $329 million of bonds, structured as auction rate securities. For each of these offerings,
the Firm served as the lead underwriter and main-broker dealer, and contracts were executed
between the parties detailing their rights and obligations under both relationships. The Firm
contended that these relationships did not give rise to a “customer” relationship sufficient to
N.1
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