Litigation Case Results

SLCG's research and testimony frequently results in press coverage and awards, decisions or orders.

 


$750,000 Burch v Huntleigh Securities Corporation Option Award.

In March 2020, a FINRA arbitration panel in St. Louis, MO ordered Huntleigh Securities Corporation to pay the Claimant $750,000 including $200,000 in punitive damages and $250,000 in attorney's fees. You can read the award here. Dr. McCann testified that the securities portfolio was poorly diversified and the heavy use of short call options in the portfolio substantially increased the risk beyond what was appropriate for the Claimant.



$455,000 Abdallah v FMSBonds Puerto Rico Bond Award

In January 2020, a FINRA arbitration panel in Boston, MA ordered FMSBonds to pay $455,000 including $80,000 in attorneys’ fees. You can read the award here. Dr. McCann testified on liability and damages over Puerto Rico municipal bonds.



$2 million Pagan v Merrill Lynch Puerto Rico Award

In January 2020, a FINRA arbitration panel in San Juan, PR ordered Merrill Lynch to pay Claimants at least $2,022,071 in compensatory damages, interest and costs including expert costs. You can read the award here. Dr. O'Neal testified on liability and damages over Merrill Lynch's sale of UBS Puerto Rico municipal closed end bond funds and Puerto Rican municipal bonds.



In Re National Prescription Opiate Litigation, MDL No. 2804 ARCOS Craig McCann Expert Report

Craig McCann has filed several expert reports in litigation arising out of the opioid epidemic. Judge Polster has made Craig’s redacted expert export in the Cuyahoga County and Summit County case publicly available. It can be downloaded here.



$2.6 million National Planning Corporation Non-traded REIT and Variable Annuity Award

In January 2020, a FINRA panel in St. Louis, MO ordered National Planning Corporation to pay $2,629,273 in well managed account damages, punitive damages and costs. You can read the award here. Dr. McCann testified on liability and damages over NPC's sale of non-traded REITs and variable annuities.



$5.88 Million Blanco v UBS of Puerto Rico Award

In August 2019, a FINRA arbitration panel in San Juan, PR ordered UBS Financial Services and UBS Financial Services of Puerto Rico to pay $4,250,000 in compensatory damages, plus interest of $1,460,937 and costs of $170,000. You can read the award here. Dr. McCann testified on liability and damages over UBS Puerto Rico's sale of UBS PR closed end funds and individual Puerto Rico municipal bonds.



$3.3 Million Torres v Morgan Stanley Award

In July 2019, a FINRA arbitration panel in Miami, FL ordered Morgan Stanley to pay $3,231,421 including $3 million in monetary sanctions for discovery abuse. You can read the award here. Dr. McCann testified on liability and damages over Puerto Rico closed end funds and municipal bonds.



$4.8 million Mudafort v UBS Award

In July 2019, a FINRA arbitration panel in San Juan, PR ordered UBS Financial Services and UBS Financial Services of Puerto Rico to pay $4,813,161 in capital losses calculated from February 2013 through March 2019 and $67,969 in expert costs. You can read the award here. Dr. O'Neal testified on liability and damages over UBS Puerto Rico's sale of UBS Puerto Rico municipal closed end bond funds and Puerto Rican municipal bonds.



$8.3 million Move.Inc v Citigroup ARS Award

In May 2019, a FINRA arbitration panel in Los Angeles, CA ordered Citigroup to pay Move.inc $8.3 million as compensation for losses on auction rate securities. The award was made after a hearing wherein the Claimants alleged that Respondents breached fiduciary duties and misrepresented the ARS. This fascinating case arose out of events in 2008 and earlier. You can read the award here. Dr. McCann testified on behalf of the Claimant.



$148,000 Aguayo v Santander Securities Award

In February 2019, a FINRA arbitration panel in San Juan, PR ordered Santander Securities to pay at least $148,000 in compensatory damages, interest and costs. You can read the award here. Dr. McCann testified on liability and damages over Santander's sale of Puerto Rico closed end funds and municipal bonds.



$343,000 Porter v RMK Award

In December 2018, a FINRA arbitration panel in Birmingham, AL ordered Morgan Keegan to pay $343,000 in compensatory damages, interest and costs to Claimant. You can read the award here. Dr. O'Neal testified on the risks of structured finance, high yield bonds, closed end funds and damages over Morgan Keegan's sale of four risky funds that held concentrated positions in structured finance investments.



$276,000 Medeiros v Quest Capital Strategies Woodbridge Mortgage Investment Funds Award

In January 2019, a FINRA arbitration panel in Boca Raton, FL ordered Quest Capital Strategies to pay $235,000 in compensatory damages and $41,226 in costs to Claimant. You can read the award here. Dr. O'Neal testified on private real estate risk, projected bankruptcy recovery in a Ponzi scheme, and damages over Quest's sale of four promissory notes of the Woodbridge Mortgage Investment Funds.



$177,500 Ionta v Mid Atlantic Capital Private Placement Award

In December 2018, a FINRA arbitration panel in Los Angeles, CA ordered Mid Atlantic Capital Group to pay $177,500 in compensatory damages. You can read the awardhere. Dr. McCann testified on liability and damages over Mid Atlantic's sale of an illiquid loan fund, Sonoma Ridge Partners.



$564,559 Pastrana v UBS of Puerto Rico Award

In October 2018, a FINRA arbitration panel in San Juan, PR ordered UBS Financial Services and UBS Financial Services of Puerto Rico to pay at least $564,559 in compensatory damages, attorney's fees and costs. The panel also ordered UBS to repurchase certain closed end funds at their account statement values. You can read the award here. Dr. McCann testified on liability and damages over UBS Puerto Rico's sale of Puerto Rico closed end funds and municipal bonds.



$19 Million Moyett v UBS of Puerto Rico Award

In October 2018, a FINRA arbitration panel in Atlanta, GA ordered UBS Financial Services and UBS Financial Services of Puerto Rico to pay $14,909,019 in compensatory damages, plus attorneys' fees of $3,878,345 and costs of $215,557. You can read the award here. Dr. McCann testified on liability and damages over UBS Puerto Rico's sale of UBS PR closed end funds and individual Puerto Rico municipal bonds.



Grimes v Trustmont Financial Group- $1 million non-traded REIT, Annuity Award

In August 2018, a FINRA arbitration panel in Tampa, FL ordered Trustmont Financial Group to pay $1,041,000 in statutory damages pursuant to FL Section 517, punitive damages, costs and fees. You can read the award here. Dr. McCann testified on liability and damages over Trustmont's sale of a non-traded REIT (Griffin Capital Essential Asset) and two variable annuity switches.

Dr. McCann's "Fiduciary Duties and Non-traded REITs" can be downloaded here and SLCG's blog posts on non-traded REITs can be found here.



$4.3 Million Bender v UBS of Puerto Rico Award

In June 2018, a FINRA arbitration panel in San Juan, PR ordered UBS Financial Services and UBS Financial Services of Puerto Rico to pay $4,20,000.00 in compensatory damages, plus costs of $100,000. You can read the award here. Dr. McCann testified on liability and damages over UBS Puerto Rico's sale of Puerto Rico municipal bonds.



$220,000 Nelson v Stifel, Nicolaus Churning / Overconcentration Award

In June 2018, a FINRA arbitration panel in Omaha, NE ordered Stifel, Nicolaus & Co. to pay the Claimant $144,967 in compensatory damages, $47,839 in attorneys' fees and $23,384 in costs including expert witness costs over the concentration of his accounts in speculative securities and alleged churning. The panel also assessed all hearing costs to the Respondent. Dr. McCann on liability and damages.



$1.9 Million Medero-Fernandez v UBS of Puerto Rico Award

In March 2018, a FINRA arbitration panel in San Juan, PR ordered UBS Financial Services and UBS Financial Services of Puerto Rico to pay $1,880,000.00 in compensatory damages. You can read the award here. Dr. McCann testified on liability and damages over UBS Puerto Rico's sale of UBS Puerto Rico municipal closed end bond funds.



$2.3 million Auguillard IRA et al v IMS Securities et al non-traded REIT Award

In November 2017, a FINRA arbitration panel in Houston, TX ordered IMS Securities and two individual Respondents to pay at least $2,304,000 in compensatory damages. You can read the award here. Dr. McCann testified on liability and damages over IMS's sale of a non-traded REITs and private placements to the Claimants.



$569,000 Benitone v Hilliard Lyons / Breitburn Energy Award

In September 2017, a FINRA arbitration panel in St. Louis, MO ordered Hilliard Lyons to pay the Claimants $450,000 in compensatory damages, $100,000 in punitive damages and $18,699 in costs over the concentration of their accounts in Breitburn Energy Partners stock in 2015. Dr. McCann testified on liability and damages.



$207,000 Hoffman v Gilford Securities et al Award

In July 2017, a FINRA arbitration panel in New York, NY ordered Gilford Securities and the broker to pay at least $207,000 in compensatory damages and interest. Dr. McCann testified on liability and damages.



Brown v. Morgan Stanley and Citigroup - $150,000 Award

In June 2017, a FINRA arbitration panel in Detroit, Michigan ordered Morgan Stanley Smith Barney, LLC and Citigroup Global Markets, Inc to pay $150,000 in compensatory damages plus costs and fees. Dr O'Neal testified to the unsuitability of the exchange fund sold to the client and to damages emanating from the exchange fund transaction.



$4.4 million Cummings v UBS of Puerto Rico Award

In March 2017, a FINRA arbitration panel in San Juan, PR ordered UBS Financial Services and UBS Financial Services of Puerto Rico to pay $3,919,359 in compensatory damages, $61,499 in costs and $442,318 in attorneys' fees. In addition, the panel voided debts claimed by the Respondents. You can read the award here. Dr. O'Neal testified on liability and damages over UBS Puerto Rico's sale of UBS Puerto Rico municipal closed end bond funds.



$9 million Romero v UBS PR Award

In February 2017, a FINRA arbitration panel in San Juan, PR ordered UBS Financial Services and UBS Financial Services of Puerto Rico to pay $7,983,230 in net compensatory damages and $1 million in punitive damages. You can read the award here. Dr. McCann testified on liability and damages over UBS Puerto Rico's sale of UBS Puerto Rico municipal closed end bond funds.



$600,000 Matus v UBS of Puerto Rico Award

In February 2017, a FINRA arbitration panel in Aventura, FL ordered UBS Financial Services and UBS Financial Services of Puerto Rico to pay $339,000 in compensatory damages, $24,500 in expert witness costs, at least $111,870 in interest plus attorney's fees to be determined by a court pursuant to FL Statute 517. You can read the award here. Dr. McCann testified on liability and damages over UBS Puerto Rico's sale of UBS Puerto Rico municipal closed end bond funds.



$25 million Gomez v UBS of Puerto Rico Award

In January 2017, a FINRA arbitration panel in San Juan, PR ordered UBS Financial Services and UBS Financial Services of Puerto Rico to pay at least $18,215,000 in compensatory damages, punitive damages, attorneys' fees and expert witness costs. It also denied the Respondents' Counterclaim to recover a large debit balance. You can read the award here. Dr. McCann testified on liability and damages over UBS Puerto Rico's sale of UBS Puerto Rico municipal bond closed end funds.



$2 million Interactive Brokers VXX ETN Award

In January 2017, a FINRA arbitration panel in Richmond, VA ordered Interactive Brokers to pay at least $1,930,000 in compensatory damages, debt cancellation and attorney's fees. You can read the award here. Dr. McCann testified on liability - specifically on whether VXX ETNs and options on VXX ETNs were eligible for portfolio margin - and damages.



$1 million Bien v Mid Atlantic Capital non-traded REIT Award

In December 2016, a FINRA arbitration panel in Denver, CO ordered Mid Atlantic Capital Group to pay at least $1,037,000 in compensatory damages, interest, attorney's fees and expert witness costs. You can read the award here. Dr. McCann testified on liability and damages over Mid Atlantic's sale of a non-traded KBS REIT and illiquid loan fund, Sonoma Ridge Partners.



$740,000 Condado Motors v UBS of Puerto Rico Award

In November 2016, a FINRA arbitration panel in San Juan, PR ordered UBS Financial Services and UBS Financial Services of Puerto Rico to pay $611,251 in compensatory damages and costs. In addition, the panel ordered UBS to buy back 17,040 shares of Fixed Income Fund III at $9.70 or make up the difference from the sales proceeds if the Claimant has sold these shares, potentially adding another $130,000 to the award given an approximate $2 per share current value. You can read the award here. Dr. O'Neal testified on liability over UBS Puerto Rico's sale of UBS Puerto Rico municipal closed end bond funds.



$958,000 Ciordia-Robles v UBS of Puerto Rico Award

In November 2016, a FINRA arbitration panel in San Juan, PR ordered UBS Financial Services and UBS Financial Services of Puerto Rico to pay $958,000 in compensatory damages, attorney's fees and expert witness costs. You can read the award here. Dr. McCann testified on liability and damages over UBS Puerto Rico's sale of UBS Puerto Rico municipal closed end bond funds.



Padilla et al v Royal Alliance - $1.1 million non-traded REIT, Annuity Award

In October 2016, a FINRA arbitration panel in San Francisco, CA ordered Royal Alliance Associates to pay $1,105,000 in compensatory. You can read the award here. Dr. McCann testified on liability and damages over Royal Alliance's sale of non-traded REITs (Inland American REIT, Inland Western REIT and Dividend Capital Diversified Realty Trust) and variable annuities to the Claimants for their retirement portfolios.

Dr. McCann's "Fiduciary Duties and Non-traded REITs" can be downloaded here and SLCG's blog posts on non-traded REITs can be found here.



$750,000 Rivera-Rivera v UBS of Puerto Rico Award

In September 2016, a FINRA arbitration panel in San Juan, PR ordered UBS Financial Services and UBS Financial Services of Puerto Rico to pay $750,000 in compensatory damages. You can read the award here. Dr. O'Neal testified on liability over UBS Puerto Rico's sale of UBS Puerto Rico municipal closed end bond funds.



Rovner v Oppenheimer - $115,000 Churning Award

In August 2016, a FINRA arbitration panel in Philadelphia, PA ordered Oppenheimer & Co. to pay $115,000 in compensatory damages after a hearing wherein the Claimant alleged Respondents churned the Claimant's accounts. The award can be downloaded here. Dr. McCann testified to the churning and damages on behalf of the Claimant.



Zabara v FMS Bonds $218,600 Puerto Rican Bond Award

In August 2016, a FINRA panel in Boca Raton, FL ordered FMS Bonds to pay the Claimant $218,600 in compensatory damages for breach of fiduciary duty, breach of contract and negligent supervision. The award is available here. The subject investments were individual Puerto Rico municipal bonds sold to a U.S. client. Dr. O'Neal testified on portfolio concentration, default risk and suitability of the Puerto Rico muni bonds.



$361,629 Ledesma v Popular Securities PR Bond and Fund Award

In July 2016, a FINRA panel in San Juan, PR ordered Popular Securities to pay the Claimant at least $361,629 including compensatory damages, attorneys' fees, expert witness fees and costs. The award is available here. The subject investments included Puerto Rico closed end bond funds co-managed by UBS and Popular and individual Puerto Rico municipal bonds. Craig McCann testified on liability and damages.



$418,262 De Jesus v UBS of Puerto Rico Award

In June 2016, a FINRA arbitration panel in San Juan, PR ordered UBS Financial Services and UBS Financial Services of Puerto Rico to pay at least $418,262 in compensatory damages based on a comparison to a portfolio of 80% taxable US bonds and 20% US stocks, attorneys' fees, costs including expert witness fees, prejudgment interest and forum fees. You can read the award here. Dr. McCann testified on liability and damages over UBS Puerto Rico's sale of UBS Puerto Rico municipal bond closed end funds.



$12.2 Million Judgment in Maybank v BB&T Affirmed

Last week the Supreme Court of South Carolina affirmed an award of $12,199,306 over the sale of variable prepaid forward (VPF) contracts. The SC Supreme Court Order is available here. The trial court's Order is available here. The jury had awarded $3.1 million in actual damages and $5 million in punitive damages. The trial court found the jury awards appropriate and that BB&T's conduct was willful and knowing and trebled the actual damages to $9.3 million. The trial court also awarded $2,899,306 in attorneys' fees and costs. The Supreme Court affirmed the award of actual damages, trebled and attorneys' fees but voided the jury's award of punitive damages. Craig McCann testified in the underlying trial on liability and damages and his testimony is discussed in both the trial court and Supreme Court Opinions.



Melton et al v. Morgan Stanley Smith Barney - $3.6 million Award

In June 2015, a FINRA arbitration panel awarded $3,586,989 in damages plus to the Claimants. The award is available here. Dr. O'Neal testified on liability and damages for the Claimants.



Polito v Centaurus Financial Nontraded REIT Award

In June 2015, a FINRA panel in Albuquerque, NM ordered Centaurus Financial, Inc. to pay the Claimant $150,000 plus all hearing fees after reasoned findings that "the investments Hashemian recommended while at Centaurus were not suitable", that Centaurus was responsible for Hashemian's actions which "constituted fraudulent and negligently made misrepresentation and omitted material information in the sale of investments" and that "Centaurus failed to supervise Hashemian is a proper and reasonable manner". The award is available here. The subject investments included non-traded REITs and equity-indexed annuities. Craig McCann testified on liability and damages.



$470,000 Melendez Ramos v UBS of Puerto Rico Award

In March 2016, a FINRA arbitration panel in San Juan, PR ordered UBS Financial Services and UBS Financial Services of Puerto Rico to pay $470,000 in compensatory damages, interest, attorneys' fees and costs.. You can read the award here. Dr. McCann testified on liability and damages over UBS Puerto Rico's sale of UBS Puerto Rico municipal bond closed end funds.



$1.2 million Ramos v UBS of Puerto Rico Award

In March 2016, a FINRA arbitration panel in San Juan, PR ordered UBS Financial Services and UBS Financial Services of Puerto Rico to pay $1.2 million in compensatory damages and expert costs. The panel also ordered the Claimant to pay $156,433 in connection with a debit balance. You can read the award here. Dr. McCann testified on liability and damages over UBS Puerto Rico's sale of UBS Puerto Rico municipal bond closed end funds.



Wiles v Questar Capital - $135,000 non-traded REIT Award

In March 2016, a FINRA arbitration panel in Louisville, KY ordered Questar Capital to pay $134,533 in compensatory damages and costs over the sale of Behringer Harvard REIT 1 non-traded REIT. You can read the award here. Dr. Henderson testified on liability and damages over Questar's sale of the non-traded REIT to the Claimant.

Dr. Henderson's "An Empirical Analysis of Non-traded REITs" forthcoming in the Journal of Wealth Management can be downloaded here and SLCG's blog posts on non-traded REITs can be found here .



Silipigno v Raymond James - $800,000 Churning Award

In February 2016, a FINRA arbitration panel in Albany, NY ordered Raymond James to pay at least $791,847 in compensatory damages and interest after a hearing wherein the Claimant alleged Respondent churned the Claimant's accounts. You can read the award here. Dr. McCann testified to the egregiousness of the churning and damages on behalf of the Claimant.



Aucoin v VSR Financial Services - $307,000 non-traded REIT / DPP Award

In February 2016, a FINRA arbitration panel in New Orleans, LA ordered VSR Financial Services to pay $307,000 in compensatory damages over non-traded REITs, promissory notes, limited partnerships and oil drilling programs. You can read the award here. Dr. Henderson testified on liability and damages over VSR's sale of the non-traded REITs and other investments to the Claimant.

Dr. Henderson's "An Empirical Analysis of Non-traded REITs" forthcoming in the Journal of Wealth Management can be downloaded here and SLCG's blog posts on non-traded REITs can be found here .



$1.45 million Bengoa v UBS of Puerto Rico Award

In February 2016, a FINRA arbitration panel in San Juan, PR ordered UBS Financial Services and UBS Financial Services of Puerto Rico to pay at least $1,450,000 in compensatory damages, interest, attorneys' fees and expert costs. You can read the award here. Dr. McCann testified on liability and damages over UBS Puerto Rico's sale of UBS Puerto Rico municipal bond closed end funds.



Ford et al v Royal Alliance - $600,000 non-traded REIT, Annuity Award

In February 2016, a FINRA arbitration panel in San Francisco, CA ordered Royal Alliance Associates to pay $596,695 in compensatory damages, attorneys' fees and costs. The Claimants were AT&T retirees who took lump sum payouts rather than pensions and invested with Royal Alliance. You can read the award here. Dr. McCann testified on liability and damages over Royal Alliance's sale of non-traded REITs and variable annuities to the Claimants for their retirement portfolio.

Dr. McCann's "Fiduciary Duties and Non-traded REITs" can be downloaded here and SLCG's blog posts on non-traded REITs can be found here.



Ohio Division of Securities, In the Matter of Timothy K. Fife - Ohio IA Registration to be Revoked

In February 2016, after evidentiary hearings, the Hearing Examiner recommended that Timothy Fife's investment adviser representative registration be revoked. The Report and Recommendation is available here. Fife's registration is being revoked because he provided investment advice and initiated securities transactions while not licensed in Ohio and because he recommended the unsuitable purchase and holding for extended periods of time of leveraged and inverse ETFs. Dr. McCann testified on behalf of the Ohio Division of Securities.

SLCG's peer-reviewed publication on leveraged and inverse ETFS include "Leveraged ETFs, Holding Periods and Investment Shortfalls" published in the Journal of Index Investing and available here, "The Properties of Short Term Investing in Leveraged ETFs published in the Journal of Financial Transformation and available here, and "Crooked Volatility Smiles: Evidence from Leveraged and Inverse ETF Options" published in the Journal of Derivatives & Hedge Funds and available here.



$800,000 Chipi v UBS of Puerto Rico Award

In December 2015, a FINRA arbitration panel in San Juan, PR ordered UBS Financial Services and UBS Financial Services of Puerto Rico to pay $800,000 in compensatory damages, interest, attorneys' fees and expert costs after finding UBS liable for various claims including breach of contract, breach of a broker's duty to supervise, negligent and intentional misrepresentation, fraud and deceit and violations of FINRA's Rules of fair practice over UBS Puerto Rico's sale of UBS Puerto Rico municipal bond closed end funds. You can read the award here. Dr. McCann testified on liability and damages.



$1.425 million Roldan Caraballo v UBS of Puerto Rico Award

In December 2015, a FINRA arbitration panel in Miami, FL ordered UBS Financial Services and UBS Financial Services of Puerto Rico to pay $1,425,000 in compensatory damages, interest, attorneys' fees and expert costs. You can read the award here. Dr. McCann testified on liability and damages over UBS Puerto Rico's sale of UBS Puerto Rico municipal bond closed end funds.



Elliott v JP Morgan $1.2 Million Short Treasury Award

In October 2015, a FINRA panel in Los Angeles, CA ordered JP Morgan to pay the Claimant $1.2 million in compensatory damages, expert witness costs and forum fees after a hearing in which Claimant alleged an unsuitable short Treasury strip strategy increased risk and caused losses. Dr. McCann testified on behalf of the Claimant.



Schvey v Janney Montgomery Scott - $427,000 Churning Award

In August 2015, a FINRA arbitration panel in New York, NY ordered Janney Montgomery Scott to pay $427,000 in compensatory damages after a hearing wherein the Claimant alleged Respondents churned the Claimant's accounts and invested in unsuitable investments. The award is the well-managed account damages based on a 40% stock, 60% bond portfolio. Dr. McCann testified to the egregiousness of the churning and damages on behalf of the Claimant.



$2.545 million Rodriguez Gonzalez v UBS of Puerto Rico Award

In August 2015, a FINRA arbitration panel in San Juan, PR ordered UBS Financial Services and UBS Financial Services of Puerto Rico to pay $2,545,000 in compensatory damages. Dr. McCann testified on liability and damages over UBS Puerto Rico's sale of UBS Puerto Rico municipal bond closed end funds.



Gonzalez, Mora and Lewis v Royal Alliance - $1.4 million non-traded REIT, Annuity Award

In July 2015, a FINRA arbitration panel in San Francisco, CA ordered Royal Alliance Associates to pay $1,401,687 in well-managed account damages measured against a 60% stock, 40% bond benchmark, punitive damages, attorney fees and expert witness fees. The Claimants were three AT&T retirees who took lump sum payouts rather than pensions and invested with Royal Alliance. You can read the award here. Dr. McCann testified on liability and damages over Royal Alliance's sale of non-traded REITs (Inland American Real Estate Trust and Dividend Capital Diversified Property Fund) and variable annuities to the Claimants for their retirement portfolio.

Dr. McCann's "Fiduciary Duties and Non-traded REITs" can be downloaded here and SLCG's blog posts on non-traded REITs can be found here.



Artmire v First Midwest Securities - $850,000 Churning Award

In July 2015, a FINRA arbitration panel in Dallas, TX ordered First Midwest Securities to pay over $850,000 in compensatory damages, punitive damages, attorney fees, expert witness fees and interest after a hearing wherein the Claimant alleged Respondents churned the Claimant's accounts. Dr. McCann testified to the egregiousness of the churning and damages on behalf of the Claimant. First Midwest Securities was bought this spring by Royal Alliance, part of the AIG Advisor Group.



Smith v Centaurus Financial, Inc. - $914,650 DPP Award

In May 2015, a FINRA panel in Los Angeles, CA ordered Respondents to pay the Claimant at least $915,650 in compensatory damages, prejudgment interest, attorney's fees, expert witness costs and rescission of illiquid non-traded REITs still held. The broker had sold the Claimant nine non-traded REITs, three oil & gas partnerships, one equipment leasing partnership and one TIC. Dr. McCann testified on behalf of the Claimant.



The Lawrence Rosenbloom Charitable Remainder Trust v. Oppenhimer & Co. - $434,000 Award

In May, 2015, a FINRA arbitration panel awarded $308,000 in compensatory damages plus $102,000 in attorney's fees and a full recovery of $24,000 in expert witness fees to the Claimants. This case involved a Charitable Remainder Trust (CRT) that was heavily margined. Dr. O'Neal testified on behalf of the claimant that the use of margin in a CRT cannot be suitable or prudent because of the 100% federal excise tax on debt-financed income. Dr. O'Neal also testified on damages.



Gilbert v Stifel Nicolaus et al - $1.5 million Churning Award

In March 2015, a FINRA arbitration panel in Jackson, MS ordered Stifel Nicolaus to pay $1,542,342 in compensatory damages and attorney fees after a hearing wherein the Claimant alleged Respondents churned the Claimant's accounts. Dr. McCann testified to the egregiousness of the churning and damages on behalf of the Claimant.



Williams v MCM - $1,218,969 Hedge Fund Award

In March 2015, a AAA arbitration panel in Los Angeles, CA ordered Montecito Capital Management to pay the Claimant $1,218,969 over the sale of the hedge funds. The AAA panel found that the Respondent was negligent in its excessive recommendation of hedge funds. Dr. McCann testified on behalf of the Claimant.



Glen Lyon v Interactive Brokers - $666,618 Margin Liquidation Award

In February 2015, an arbitration panel in Richmond, VA ordered Interactive Brokers to pay its former client $666,618 in compensatory damages, interest and expert witness fees. The Claimant alleged that Interactive Brokers failed to liquidate the portfolio pursuant to a margin call in a commercially reasonable manner. Dr. McCann testified at the final hearing on behalf of the Claimant.



LaBolle v Oppenheimer et al - $300,000 Churning Award

In February 2015, a FINRA arbitration panel in Detroit, MI ordered Oppenheimer & Co. to pay $299,858 in compensatory damages, attorney fees, expert witness fees and filing fees after a hearing wherein the Claimant alleged Respondents churned the Claimant's accounts. Dr. McCann testified to the egregiousness of the churning and damages on behalf of the Claimant.



Felter v National Planning Corporation - $1.22 million TIC Award

In February 2015, a FINRA panel in Des Moines, IA ordered Respondents to pay the Claimant $1.22 million in compensatory damages and expert witness costs after a hearing in which Claimant alleged that the TIC sold did not pass a reasonable basis suitability test. Dr. McCann testified on behalf of the Claimant.



Cerisano v Interactive Brokers - $2.4 million Negligence Award

In January 2015, an arbitration panel in Newark, NJ ordered Interactive Brokers to pay its former client $2.4 million in compensatory damages. The case dealt with the risk and other material features of futures contracts on the VIX index. Dr. McCann testified at the final hearing on behalf of the Claimant.



Purdue Avenue Investors LP v Morgan Keegan & Co. and Morgan Asset Management

In December 2014, a Court in Dallas, Texas ordered Morgan Keegan and Morgan Asset Management to pay $2,150,803.60 in compensatory damages and prejudgment interest plus post judgment interest at the rate of 5% accruing from December 19, 2014 in connection with Morgan Keegan's sale of the RMK Advantage Income Fund, RMK High Income Fund and RMK Strategic Income Fund. The Court found violations of the Texas Securities Act because the boilerplate language in the prospectuses did not convey the true risks of the funds. Craig McCann testified on behalf of the Plaintiffs.



Maybank v BB&T et al - $17.2 million Variable Prepaid Forward VPF Award

On November 10, 2014, a State Court in Greenville, SC ordered BB&T to pay the Plaintiff $17.2 million over the Bank's recommendation and sale of two variable prepaid forward contracts. This amount reflected $3.1 million in actual damages and $5 million in punitive damages awarded by the jury on June 30, 2014 after a two week trial. The Court found the Defendants' conduct in violation of the Unfair Trade Practices Act was "knowing and willful" and "reprehensible" and "that Defendants acted with malice, trickery, or deceit rather than mere accident," trebled actual damages to $9.3 million and awarded $3 million in attorneys' fees and costs. Dr. McCann testified at the hearing that the VPFs were high cost, opaque and not properly characterized in the presentations and provided testimony which the Court found fully supported the jury's award of damages.



State of Illinois v. Richard Van Dyke - $353,500 Fined for Fraudulent Annuity Sales Practices

In April 2014, Illinois Secretary of State Jesse White revoked the investment adviser and investment adviser representative registrations of Richard Lee Van Dyke, who was doing business as Dick Van Dyke Registered Investment Adviser. Additionally, Van Dyke was fined $330,000 and ordered to pay costs of investigation and expert witness fees of $23,500. Van Dyke's registrations were revoked because he defrauded 21 of his clients who were all senior citizens. Dr. O'Neal testified that the advice to surrender existing annuities and purchase new annuities was unsuitable for Van Dyke's clients.



Dulin v UBS - $5.4 million Intentional Interference Award

In April 2014, an arbitration panel in Phoenix, AZ ordered UBS Financial Services to pay its former broker $4 million compensatory, $1 million punitive damages, $250,000 attorneys' fees, $85,000 in costs, $50,000 plus in arbitration fees. Punitive damages were based on injurious falsehood and the Panel specifically stated that as Lehman feel apart, UBS did not properly apprise Financial Advisers. The Panel also expunged all 39 cases and ruled that if, for some reason a court does not approve the expungement, then the broker will get another $4 million in compensatory damages. Dr. McCann testified at the final hearing on behalf of the broker.



Umstead v National Planning Group - $290,000 Asset Allocation / Concentration Award

In December 2013, an FINRA arbitration panel in Philadelphia, PA ordered National Planning Group to pay Claimants $290,000 including costs and prejudgment interest. Dr. McCann testified that the securities portfolio was poorly diversified and the heavy use of short call options in the portfolio substantially increased the risk beyond what was appropriate for the Claimants.



Lewis v Wells Fargo Advisors $355,000 Asset Allocation / Concentration Award

In December 2013, an FINRA arbitration panel in Philadelphia, PA ordered Wells Fargo Advisors to pay Claimants $355,000 including prejudgment interest. Dr. McCann testified that the securities portfolio was poorly diversified, being concentrated in real-estate and energy related stocks and funds.



Auto City Service v JP Morgan - $2.4 million Interest Rate Swap Award

In November 2013, a FINRA panel in Detroit, MI ordered JP Morgan to pay the Claimant $2.4 million in compensatory damages, prejudgment interest, costs and attorneys' fees after a hearing in which Claimant alleged breach of contract and breach of fiduciary duties. Dr. McCann testified on behalf of the Claimant.



Farah v Wedbush Morgan Securities, Inc. - $4.3 million CMO-related Labor Award

In September 2013, an FINRA arbitration panel in Los Angeles, CA ordered Wedbush to pay a former broker and his attorneys $4.3 million including $1,334,387 for lost income, $1,439,555.50 in punitive damages, $1,472.005.79 in attorneys' fees, $18,500 in expert witness fees and $21,674.25 in other costs. Wedbush provided lower tranche manufactured housing CMOs to the broker for sale to his clients as good substitutes for bank CDs, suitable for "widows and orphans" back in 2001 and 2002. After losses in these private label CMOs, dozens of clients filed arbitrations against Wedbush. Dr. McCann testified in the underlying customer arbitrations and again in this recent labor case, that the CMO's were highly speculative and not suitable for risk adverse bond investors. He also testified that this failure to make complete and accurate disclosures was a breach of the fiduciary duty owed to brokerage firm customers.



Odessa Fireman's Relief & Retirement Fund v Morgan Keegan - $399,566 (RMA, RHY) Award

In September 2013, a FINRA arbitration panel in Dallas, Texas ordered Morgan Keegan to pay $399,566 in compensatory damages in connection with Morgan Keegan's sale of the RMK Advantage Income Fund (RMA) and RMK Mult-Sector High Income Fund (RHY). Dr. O'Neal testified on behalf of the Claimants.



Berghorst v Citigroup - $2,000,000 MAT, MAT Two, MAT Three and MAT Five Award

In June 2013, a FINRA arbitration panel in Boca Raton, FL ordered Citigroup to pay Claimant $2,000,000 over the sale of Citigroup's MAT, MAT Two, MAT Three and MAT Five leveraged municipal bond hedge funds. The award was made after a hearing wherein the Claimant alleged that Respondent breached contractual and fiduciary duties and misrepresented the hedge fund. Dr. McCann testified on behalf of the Claimant.



Harwich v Pacific Securities - $5,088,395 TIC Award

In June 2013, a FINRA panel in Boston, MA ordered Respondents to pay the Claimant $5,088,395 in compensatory damages, punitive damages, attorney fees and costs after a hearing in which Claimant alleged that the TIC sold did not pass a reasonable basis suitability test. Dr. McCann testified on behalf of the Claimant.



Texas PGI v Citigroup - $1,057,067 ARS Award

In May 2013, a FINRA arbitration panel in Dallas, TX ordered Citigroup to pay the Claimant over $1 million as compensation for losses on student loan auction rate securities. The award was made after a hearing wherein the Claimants alleged that Respondents breached fiduciary duties and misrepresented the ARS. Dr. McCann and testified on behalf of the Claimants.



Asad v ProEquities, Inc. - $588,128 Tenant in Common TIC Award

In May 2013, a FINRA panel in Los Angeles, CA ordered Respondents to pay the Claimant $588,128 in compensatory damages, prejudgment interest and costs after a hearing in which Claimant alleged that the TIC sold did not pass a reasonable basis suitability test. Dr. McCann testified on behalf of the Claimant.



US Airways v Oppenheimer & Co. Inc. - $30 million ARS Award

In January 2013, a FINRA arbitration panel in New York, NY ordered Oppenheimer to pay US Airways $30 million as compensation for losses on Camber, Capstan and Pivot credit-linked auction rate securities. The award was made after a hearing wherein the Claimants alleged that Respondents breached fiduciary duties and misrepresented the ARS. Dr. McCann and Mr. Meyer testified on behalf of the Claimants.



Gillespie vs Oppenheimer et al - $1.2 million Churning Award

In January 2013, a FINRA arbitration panel in Houston, TX ordered Oppenheimer & Co. to pay at least $1,214,200 including attorney fees, interest and expenses after a hearing wherein the Claimant alleged Respondents churned the Claimant's accounts. Dr. McCann testified to the egregiousness of the churning and damages on behalf of the Claimant.



Golden v Genspring - $4.55 million "Low Volatility" Hedge Fund Award

In December 2012, a JAMS arbitrator in Miami, FL ordered GenSpring Family Offices to pay the Claimant $4.55 million in out of pocket losses an rescission. The award was made after a hearing wherein the Claimant alleged that the Respondent invested in low volatility hedge funds in lieu of traditional bonds. Dr. McCann testified on behalf of the Claimant.



Dale v Morgan Keegan - $1.38 Million (MKIBX) Award

In December 2012, a FINRA arbitration panel in Dallas, Texas ordered Morgan Keegan to pay $1.38 million in compensatory damages plus interest at the rate of 5% accruing from October 4, 2010 through and including October 1, 2012, attorneys fees and costs in connection with Morgan Keegan's sale of the RMK Select Intermediate Bond Fund (MKIBX). Dr. O'Neal testified on behalf of the Claimants.



Straccia et al v Ceros Financial Services - $1.82 million Leveraged and Inverse ETF Award

In November 2012, a FINRA arbitration panel in Manchester, NH ordered Focus Capital, Inc., Focus Capital Wealth Management, Inc. and Nicholas B. Rowe to pay Claimants $1.82 million including $442,829 in attorneys' fees, $19,836 in costs and $30,000 in expert witness fees. The award was made after a hearing wherein the Claimants alleged that Respondents invested in unsuitable leveraged and inverse ETFs. Dr. McCann testified on behalf of the Claimants.



Roberts v ThinkEquity - $1.475 million ARS Award

In October 2012, a FINRA arbitration panel in New York, NY ordered ThinkEquity to redeem at par $1.475 million of auction rate securities remaining in the Claimant's accounts. The award was made after a hearing wherein the Claimant alleged that Respondents breached fiduciary duties and misrepresented the ARS. Dr. McCann testified on behalf of the Claimant.



Burford v JP Morgan Chase Bank - $18 million + Variable Prepaid Forward VPF Award

In October 2012, the Oklahoma District Court in Tulsa, OK ordered JP Morgan Chase Bank to pay the Burford Trust $18,122,644 plus attorneys' fees and punitive damages to be determined. The award compensates the Trust for the diminution in value resulting from JP Morgan engaging in a series of variable prepaid forward contracts with the Trust. Dr. McCann testified at the hearing that the VPFs were high cost, opaque and not properly characterized in the presentations and that investment of the VPF proceeds in a municipal bond fund with interest paid to the income beneficiary virtually guaranteed that the Trust's Exxon-Mobil stock position would eventually be fully covered by the VPFs and ultimately sold off. Mr. Meyer testified about the pressures to sell in-house products and services without regard for the interests of the Trust beneficiaries.



Wagner v Wells Fargo - $2.225 million ARS Award

In May 2012, a FINRA arbitration panel in Los Angeles, CA ordered Wells Fargo to redeem at par $2.225 million of auction rate securities and to pay Claimants losses on ARS the Claimants had sold at a loss. The award was made after a hearing wherein the Claimants alleged that Respondents breached fiduciary duties and misrepresented the ARS. Mr. Meyer testified on behalf of the Claimants.



Zeigon v First Republic - $870,631 TW Tax Advantaged Fund Award

In March 2012, a FINRA arbitration panel in San Francisco, CA ordered First Republic Securities to pay the Claimants $870,631 over the sale of a collateralized bond obligation (CBO) and the TW Tax Advantaged Fund LLC leveraged municipal bond arbitrage hedge fund. The panel dismissed claims on two of three CBOs based on FINRA's six-year eligibility rule and awarded the Claimant's 75% of the remaining out-of-pocket losses. Mr. Meyer testified about compliance and sales practices on behalf of the Claimants. Dr. McCann testified about the investments on behalf of the Claimants.



Rote v Morgan Keegan - $400,000 (MKIBX, RMH) Award

In February 2012, a FINRA arbitration panel in Memphis, TN ordered Morgan Keegan to pay $400,000 in damages to Claimants after a hearing in which Claimants alleged that Morgan Keegan misrepresented the risks of the Select Intermediate Bond Fund (MKIBX) and the High Income Fund (RMH). Dr. McCann testified on behalf of the Claimants.



Jenkins v Crowell Weedon - $51,807 Preferred Stock Award

In February 2012 a FINRA panel in Los Angeles awarded Claimant $51,807 in compensatory damages, the full amount sought. The award was made after a hearing in which the Claimant alleged that the broker's professional obligation to assist clients in setting proper investment objectives and risk tolerance was improper. Mr. Meyer testified on behalf of the Claimant as to the unfavorable risk/return characteristics of preferred stocks and their unsuitability for most retail investors.



Hayes v Banc of America Securities - $1.4 million CLO Award

In January 2012, a FINRA arbitration panel in Reno, NV ordered Banc of America Securities to pay the Claimant $1.375 million including $218,344 in attorneys\' fees and $23,500 in expert witness fees over the sale of the E-1 Notes of LCM VII, a collateralized loan obligation. The award was made after a hearing in which the Claimant alleged that Respondents violated Nevada's securities fraud statute by failing to disclose that losses in the loans backing the CLO prior to the issuance of the CLO were being transferred to the CLO investors and would make the CLO notes much less valuable and much more risky. Dr. McCann testified on behalf of the Claimant.

Research
CLOs, Warehousing, and Banc of America's Undisclosed Losses



Perry v Oppenheimer - $6.1 million ARS Award

In January 2012, a FINRA arbitration panel in New York, NY ordered Oppenheimer to pay Claimants $6.1 million including $134,108 in attorneys\' fees over the sale of auction rate securities. The award was made after a hearing wherein the Claimants alleged that Respondents failed to supervise, breached contractual and fiduciary duties and misrepresented the ARS. Dr. O\'Neal testified on behalf of the Claimants.



Callas Foundation, Inc. v Morgan Keegan - $265,000 (RMA, RHY) Award

In January 2012, a FINRA arbitration panel in Atlanta, GA ordered Morgan Keegan to pay Claimants $231,337 in compensatory damages plus interest at the rate of 7% accruing from November 15, 2009 until the date of payment in connection with Morgan Keegan's sale of the RMK Advantage Income Fund (RMA) and RMK Multi-Sector High Income Fund (RHY). Dr. O'Neal testified on behalf of Claimants.



Puglisi v Citigroup - $750,000 MAT Five Award

In November 2011, a FINRA arbitration panel in Newark, NJ ordered Citigroup to pay Claimant $706,759 plus pre-judgment interest over the sale of Citigroup\'s MAT Five leveraged municipal bond hedge fund. The award was made after a hearing wherein the Claimant alleged that Respondent breached contractual and fiduciary duties and misrepresented the hedge fund. Dr. McCann testified on behalf of the Claimant.



Pelican Holdings et al v Morgan Keegan - $889,340 (MKIBX, RMA) Award

In November 2011, a FINRA arbitration panel in Memphis, TN ordered Morgan Keegan to pay Claimants $889,340 in connection with Morgan Keegan's sale of the RMK Select Intermediate Fund (MKIBX) and the RMK Advantage Income Fund (RMA). Dr. O'Neal testified on behalf of Claimants.



Lett et al v Wells Fargo Advisors, LLC - $130,000 Suitability Award

In November 2011 a FINRA panel in Atlanta awarded Claimant compensatory damages of $130,000. Mr. Meyer testified about the excessive risk in the Claimant's securities, resulting in an unsuitable portfolio. In an explained award, the panel stated that "in choosing high-return securities for the account, with their attendant risk", Respondent Wells Fargo Advisors recommended an "unsuitable investment portfolio" to Claimant.



Beattie v Merrill Lynch - $230,000 Annuity Award

In November 2011 a FINRA arbitration panel in Orlando awarded Claimant $230,000 in compensatory damages arising from an exchange of variable annuity contracts recommended by Respondent. Mr. Meyer testified about the suitability issues attendant to annuity purchases and switches.



Estate of Margaret Cwirko v Morgan Stanley $241,344 Award

In October 2011 a FINRA panel in New Jersey awarded Claimant $241,344 in compensatory damages resulting from the embezzlement of funds from her brokerage account by Claimant's son-in-law. Mr. Meyer testified about a broker-dealer's supervisory duty to review customer accounts for "red flags" or indications of possible wrongdoing, and respond promptly and appropriately.



Christian Brothers University v Morgan Keegan - $500,000 (MKHIX) Award

In September 2011, a FINRA arbitration panel in Memphis, TN ordered Morgan Keegan to pay the Christian Brothers University Endowment Fund $432,061 plus interest in connection with Morgan Keegan's sale of the RMK Select High Income Fund (MKHIX). Dr. O'Neal testified on behalf of the Christian Brothers University.



Young v Deutsche Park Securities - $1 million Aravali Fund Award

In August 2011, a FINRA arbitration panel in Philadelphi, PA ordered Deutsche Park Securities to pay Claimant at least $955,000 including interest over the sale of the Aravali leveraged municipal bond hedge fund. The award was made after a hearing wherein the Claimant alleged that Respondent breached contractual and fiduciary duties and misrepresented the hedge funds. Dr. McCann testified on behalf of the Claimant.



Precaspian Development Corporation v Todd Ficeto and Hunter World Markets - $6.2 million Award

In August 2011 a California Superior Court jury in Los Angeles awarded the Plaintiff $1.2 million in compensatory damages and $4 million in punitive damages. On behalf of the Plaintiff, Mr. Meyer testified about various techniques Defendants used to manipulate prices of certain microcap stocks held in hedge funds owned by the Plaintiff. Mr. Meyer also testified about the harmful effects of stock price manipulation on the financial markets.



Robb et al v Neuberger Berman - $5,537,000 Lehman Structured Products / Hedge Fund Award

In July 2011, a FINRA arbitration panel in Chicago, IL ordered Neuberger Berman to pay $5,052,500 in compensatory damages and costs plus approximately $484,500 in interest. The award was made after a hearing wherein the Claimants alleged Respondents engaged in "a general fraudulent scheme to target investors, especially high net worth individuals to raise funds for Lehman Brothers Holdings and Lehman Brothers, Inc. under the guise of principal protected notes." The claims related to the purchase of Lehman Brothers issued "Annual Review Notes with Contingent Principal Protection Linked to the Financial Select Sector SPDRR Fund ("XLF")", "100% Principal Protected Notes Linked to ComBATS I" and "Liberty ViewCredit Select Fund." Dr. McCann testified on behalf of the Claimant.



Croce v UBS Financial Services - $1,770,000 UBS / Lehman Structured Products Award

In June 2011, a FINRA arbitration panel in Philadelphia, PA ordered UBS Financial Services Inc. to pay $1,520,000 in damages plus approximately $250,000 in interest. The award was made after a hearing wherein the Claimant alleged Respondents breached contractual and fiduciary duties and failed to suitably invest Claimant's account. The claims related to the purchase of a Lehman Brothers issued "100% Principal Protection Notes Linked to Year-Over-Year Change in the Consumer Price Index." Dr. McCann testified on behalf of the Claimant.



US Airways v Hansalik, et al - $15 million ARS Award

In May 2011, a FINRA arbitration panel in New York, NY ordered three former Lehman Brothers' employees to pay US Airways $15 million over the sale of Asset-Backed Capital Commitment Securities (ABCs), Committed Preferred Custodial Trust Securities (CPS) and Regulation XXX surplus notes backed auction rate securities. The award was made after a hearing wherein the US Airways alleged that Respondents failed to supervise, breached contractual and fiduciary duties and misrepresented the ARS. Dr. McCann testified on behalf of the Claimants.



Albertine et al v Morgan Keegan - $881,000 (MKIBX, RHY, RSF, RMA, RMH) Award

In April 2011, a FINRA arbitration panel in Memphis, TN ordered Morgan Keegan to pay the Claimants $881,000 in compensatory damages and expert witness fees in connection with Morgan Keegan's sale of the RMK Select Intermediate Bond (MKIBX), High Income (RMH), Advantage Income (RMA), Strategic Income (RSF) and Multi-Sector High Income (RHY) funds. Dr. McCann testified on behalf of the Claimants.



Hosier et al v Citigroup - $54.1 million MAT Finance, MAT Two, MAT Three, MAT Five Award

In April 2011, a FINRA arbitration panel in Denver, CO ordered Citigroup to pay Claimants $54.1 million including $17 million in punitive damages and $3 million in attorneys\' fees over the sale of Citigroup\'s MAT Finance, MAT Two, MAT Three, MAT Five, ASTA Finance, ASTA Three and ASTA Five leveraged municipal bond hedge funds. The award was made after a hearing wherein the Claimants alleged that Respondent breached contractual and fiduciary duties and misrepresented the hedge funds. Dr. McCann testified on behalf of the Claimants.



Coleman v Citigroup - $230,667 ASTA Five Award

In February 2011, a FINRA arbitration panel in Los Angeles, CA ordered Citigroup to pay Claimants $230,667 over the sale of Citigroup's ASTA Five leveraged municipal bond hedge fund. The award was made after a hearing wherein the Claimants alleged that Respondent breached contractual and fiduciary duties and misrepresented ASTA Five. Dr. McCann testified on behalf of the Claimants.



Karrels v Morgan Keegan - $373,135 (MKIBX) Award

In February 2011, a FINRA arbitration panel in Memphis, TN ordered Morgan Keegan to pay the Claimant $373,135 in compensatory damages, attorneys' fees and expert witness fees pursuant to the Tennessee Securities Act in connection with Morgan Keegan's sale of the RMK Select Intermediate Bond Fund (MKIBX). Dr. McCann testified on behalf of the Claimant.



Liles v Morgan Keegan - $81,291 (RHY) Award

In February 2011, a FINRA arbitration panel in Houston, TX ordered Morgan Keegan to pay the Claimant $81,291 in compensatory damages and costs including expert witness fees in connection with Morgan Keegan's sale of the RMK Multi-Sector High Income Fund (RHY). Dr. McCann testified on behalf of the Claimant.



Beard v Citigroup - $336,000 ASTA Five Award

In December 2010, a FINRA arbitration panel in Los Angeles, CA ordered Citigroup to pay Claimants $336,000 including $31,629 in fees and costs over the sale of Citigroup's ASTA Five leveraged municipal bond hedge fund. The award was made after a hearing wherein the Claimants alleged that Respondent breached contractual and fiduciary duties and misrepresented ASTA Five. Dr. McCann testified on behalf of the Claimants.



Barnett et al v Citigroup - $2,428,000 MAT Five Award

In December 2010, a FINRA arbitration panel in Memphis, TN ordered Citigroup to pay Claimants $2,428,000 over the sale of Citigroup's MAT Five leveraged municipal bond hedge fund. The award was made after a hearing wherein the Claimants alleged that Respondent breached contractual and fiduciary duties and misrepresented MAT Five. Dr. McCann testified on behalf of the Claimants.



Chapman v Citigroup - $3,000,000 Concentrated Stock Award

In November 2010 a FINRA arbitration panel in San Francisco, CA ordered Citigroup to pay $3,000,000 to the Claimant who alleged, among other claims, breach of fiduciary duty, breach of contract and failure to supervise. Dr. McCann testified on behalf of the Claimant about the feasibility and impact of hedging strategies for concentrated stock positions.



Flautt v Morgan Keegan - $2,138,805 (MKHIX, RSF, RHY) Award

In November 2010, a FINRA arbitration panel in Boca Raton, FL ordered Morgan Keegan to pay at least $2,138,805 in damages and prejudgment interest to Claimants. The award was $1,825,517 in capital losses and at least $313,288 in prejudgment interest. The panel found Morgan Keegan explicitly "liable for misrepresentations and omissions (common law fraud), breach of fiduciary duty, unsuitable investments, negligence, failure to supervise, breach of contract, and vicarious liability" related to Claimants\' investments in the RMK Select High Income Fund (MKHIX), RMK Strategic Income Fund (RSF), and RMK Multi-Sector High Income Fund (RHY). Dr. McCann testified on behalf of the Claimants.



Quiros v Merrill Lynch - $500,000 Award

In November 2010, a FINRA arbitration panel in Los Angeles ordered Merrill Lynch to pay compensatory damages of $500,000 to Claimant William Quiros. Claimant alleged that Merrill Lynch failed adequately to supervise the securities-related activities of two registered representatives, one of whom was conducting business away from his branch office. Claimant also alleged fraud and misrepresentation in connection with the offering of a security Merrill Lynch had not approved for sale. On behalf of the claimant, Mr. Meyer testified about a broker-dealer's duty to supervise all the securities-related activities of its associated persons.



Lesmir et al v Wedbush - $3.1 million Nuveen ARPS ARS Award

In November 2010, a FINRA arbitration panel in Seattle, WA ordered Wedbush Morgan to redeem at par $2,825,000 in auction rate preferred securities plus $2245,865 in attorneys' fees and costs. The award was made after a hearing wherein the Claimants alleged Respondents breached fiduciary duties and committed securities fraud. Dr. McCann testified on behalf of the Claimants.



Mercer v Morgan Keegan - $444,978 (RSF, RMA, RHY) Award

In November 2010, a FINRA arbitration panel in Orlando, FL ordered Morgan Keegan to pay $444,978 in damages plus attorneys' fees and costs to be determined. The award was made after a hearing wherein the Claimants alleged Respondents breached contractual and fiduciary duties and committed securities fraud. The panel found Morgan Keegan liable for "breach of fiduciary duty; unsuitability and failure to supervise." The claims related to Claimants' investments in the RMK Strategic Income Fund (RSF), RMK Advantage Income Fund (RMA) and RMK Multi-Sector High Income Fund (RHY). Dr. McCann testified on behalf of the Claimants.



Hagman v Citigroup - $11,558,127 Award

In October 2010 a FINRA arbitration panel in Los Angeles, CA ordered Citigroup to pay a total of $11,558,127, including punitive damages of $10 million, attorneys\' fees, and costs. Claimants alleged breach of fiduciary duty, fraud, and failure to supervise. On behalf of the Claimants, Paul Meyer testified about the role of asset allocation in making suitable recommendations and the duty to impose heightened supervision on registered representatives with a history of customer complaints.

News Article
- The New York Times, October 9, 2010 - "It's Not Nice to Mess With J.R."



Garrett et al v Morgan Keegan - $9.2 million (RMH, RSF, RMA, RHY)

In October 2010, a FINRA arbitration panel in Houston, TX ordered Morgan Keegan to pay $9.2 million in damages including $1.1 million in attorneys' fees and $78,000 in costs. The award was made after a hearing wherein the Claimants alleged Respondents breached contractual and fiduciary duties, failed to suitably invest Claimants' accounts, and failed to supervise Claimants' accounts. "Claimants alleged that the suit arises out of a fraudulent scheme that induced Claimants to invest substantial retirement and trust funds into high risky closed-end mutual funds, managed by Morgan Keegan, that purchased illiquid mortgage-backed loans and collateralized debt obligations." The panel found Morgan Keegan liable. The claims related to Claimants' investments in the RMK High Income Fund (RMH), RMK Strategic Income Fund (RSF), RMK Advantage Income Fund (RMA) and RMK Multi-Sector High Income Fund (RHY). Dr. McCann testified on behalf of the Claimants.



Silk v Citigroup - $1,000,000 MAT Three and MAT Five Award

In August 2010, a FINRA arbitration panel in Los Angeles, CA ordered Citigroup to pay Claimants $1,000,000 over the sale of Citigroup's MAT Three and MAT Five leveraged municipal bond hedge funds. The award was made after a hearing wherein the Claimants alleged that Respondent breached contractual and fiduciary duties and negligently misrepresented MAT Three and MAT Five. Dr. McCann testified on behalf of the Claimants.



East Tennessee Neurology, PC v Morgan Keegan - $484,357 (RMH, RSF, RMA, RHY) Award

In August 2010, a FINRA arbitration panel in Birmingham, AL ordered Morgan Keegan to pay $484,357 in damages including $115,689 in attorneys' fees and $52,413 in costs. The award was made after a hearing wherein the Claimants alleged Respondents breached contractual and fiduciary duties, failed to suitably invest Claimants' accounts, and failed to supervise Claimants' accounts. The panel found Morgan Keegan "liable for unsuitability, negligence and failure to supervise." The claims related to Claimants' investments in the RMK High Income Fund (RMH), RMK Strategic Income Fund (RSF), RMK Advantage Income Fund (RMA) and RMK Multi-Sector High Income Fund (RHY). Dr. McCann testified on behalf of the Claimants.



Kazma v Citigroup - $1,817,000 ASTA Three and ASTA Five Award

In August 2010, a FINRA arbitration panel in Boca Raton, FL ordered Citigroup to pay Claimants $1,817,000 over the sale of Citigroup's ASTA Three and ASTA Five leveraged municipal bond hedge funds. The award was made after a hearing wherein the Claimants alleged that Respondent breached contractual and fiduciary duties and negligently managed and misrepresented the ASTA investments. Dr. Prendergast testified on behalf of the Claimants.



Levinthal v First Republic - $2,178,153 TW Tax Advantaged Fund Award

In July 2010, a AAA arbitration panel in San Francisco, CA ordered First Republic to pay the Claimants $2,178,153 over the sale of the TW Tax Advantaged Fund LLC leveraged municipal bond arbitrage hedge fund. The AAA panel found that First Republic was professionally negligent and breached fiduciary duties owed to its customers by failing to perform adequate due diligence in the fund and inadequately training and supervising its brokers. Dr. McCann testified on behalf of the Claimants.



Miller v Citigroup - $489,877 MAT Three Award

In June 2010, a FINRA arbitration panel in Seattle, WA ordered Citigroup to pay Claimants $489,877 including attorney's fees over the sale of Citigroup's MAT Three leveraged municipal bond hedge fund. The award was made after a hearing wherein the Claimants alleged that Respondent breached contractual and fiduciary duties and negligently misrepresented MAT Three. Dr. McCann testified on behalf of the Claimants.



Miniaci v Morgan Keegan - $1,080,000 (MKIBX, RMA, RHY) Award

In June 2010, a FINRA arbitration panel in Ft. Lauderdale, FL ordered Morgan Keegan to pay $1,080,000 in damages. The award was made after a hearing wherein the Claimants alleged Respondents breached contractual and fiduciary duties, failed to suitably invest Claimants' accounts, and failed to supervise Claimants' accounts. The panel found Morgan Keegan "liable for unsuitability, negligence and failure to supervise." The claims related to Claimants' investments in the RMK Select Intermediate Bond Fund (MKIBX), RMK Advantage Income Fund (RMA) and RMK Multi-Sector High Income Fund (RHY). Dr. McCann testified on behalf of the Claimants.



Christianson v Morgan Keegan - $247,557 (RHY, MKHIX) Award

In June 2010, a FINRA arbitration panel in Denver, CO ordered Morgan Keegan to pay $247,557 in damages. The award was made after a hearing wherein the Claimants alleged Respondents breached contractual and fiduciary duties, failed to suitably invest Claimants' accounts, and failed to supervise Claimants' accounts. The panel found Morgan Keegan "liable for unsuitability, negligence and failure to supervise." The claims related to Claimants' investments in the RMK Select High Income Fund (MKHIX) and RMK Multi-Sector High Income Fund (RHY). Dr. McCann testified on behalf of the Claimants.



Selan v Citigroup - $550,505 MAT Three Award

In May 2010, a FINRA arbitration panel in Los Angeles, CA ordered Citigroup to pay Claimants $550,505 and costs over the sale of Citigroup's MAT Three leveraged municipal bond hedge fund. The award was made after a hearing wherein the Claimants alleged that Respondent breached contractual and fiduciary duties and negligently misrepresented MAT Three. Dr. McCann testified on behalf of the Claimants.



Abramson v Citigroup - $1,710,000 MAT V Award

In May 2010, a FINRA arbitration panel in Los Angeles, CA ordered Citigroup to pay $1,710,000 including $25,000 in costs and interest on the award at the rate of 10%. The panel also assessed $18,000 in forum fees to the Respondent. The award was made after a hearing wherein the Claimants alleged that Respondent breached contractual and fiduciary duties and negligently misrepresented MAT V, a leveraged municipal bond arbitrage fund. Dr. McCann testified on behalf of the Claimants.



Roe Green Foundation v Charles Schwab - $310,000 (SWYSX) Award

In April 2010, a FINRA arbitration panel in Cleveland, OH ordered Charles Schwab to pay the Claimants $310,000. The award was made after a hearing wherein the Claimants alleged that Schwab misrepresented its YieldPlus (SWYSX) bond fund as a low risk alternative to a money market fund for cash holdings. Dr. McCann testified on behalf of the Claimants that the YieldPlus fund was much riskier than money market funds, that its portfolio was dominated by illiquid private-label mortgage backed securities containing considerable credit risk and that Schwab apparently overstated the fund's NAV in late 2007 and early 2008.



Pomeroy v Charles Schwab - $850,000 (SWYCX) Award

In April 2010, a FINRA arbitration panel in San Francisco, CA ordered Charles Schwab to pay the Claimants $850,000 including $150,000 in attorneys' fees, $14,850 in costs including expert witness fees and interest on the award at the rate of 7%. The award was made after a hearing wherein the Claimants alleged that Schwab misrepresented its California Tax-Free YieldPlus (SWYCX) bond fund as a low risk alternative to money market funds and as being consistent with capital preservation. Dr. Prendergast testified on behalf of the Claimants that the California Tax-Free YieldPlus fund was much riskier than money market funds and that its holdings were inconsistent with those of money market funds. He also testified that the Claimants suffered $604,094 in capital losses.



Mauney v Charles Schwab - $246,560 (SWYSX) Award

In April 2010, a FINRA arbitration panel in Seattle, WA ordered Charles Schwab to pay the Claimant $246,560 including $53,359 in attorneys' fees. The award was made after a hearing wherein the Claimants alleged that Schwab misrepresented its YieldPlus (SWYSX) bond fund as a low risk alternative to a money market fund for cash holdings. Dr. McCann testified on behalf of the Claimants that the YieldPlus fund was much riskier than money market funds, that its portfolio was dominated by illiquid private-label mortgage backed securities containing considerable credit risk and that Schwab apparently overstated the fund's NAV in late 2007 and early 2008.



Cobb et al v Morgan Keegan - $1,100,000 (MKHIX, RMH, RMA, RSF, RHY) Award

In February 2010, a FINRA arbitration panel in Birmingham, AL ordered Morgan Keegan to pay $1,100,000 in damages. The award was made after a hearing wherein the Claimants alleged Respondents breached contractual and fiduciary duties, failed to suitably invest Claimants' accounts, and failed to supervise Claimants' accounts. The panel found Morgan Keegan liable for "misrepresentation and failure to disclose the true nature of the RMK funds." The claims related to Claimants' investments in the RMK Select High Income Fund (MKHIX), RMK High Income Fund (RMH), RMK Advantage Income Fund (RMA), RMK Strategic Income Fund (RSF) and RMK Multi-Sector High Income Fund (RHY). Dr. McCann testified on behalf of the Claimants.



Stein et al v Morgan Keegan - $2,500,000 (MKHIX, RMA, RSF, RHY) Award

In February 2010, a FINRA arbitration panel in Boca Raton, FL ordered Morgan Keegan to pay $2,500,000 in damages. The award was made after a hearing wherein the Claimants alleged Respondents breached contractual and fiduciary duties, failed to suitably invest Claimants' accounts, and failed to supervise Claimants' accounts. The panel found Morgan Keegan "liable for unsuitability, negligence and failure to supervise." The claims related to Claimants' investments in the RMK Select High Income Fund (MKHIX), RMK Advantage Income Fund (RMA), RMK Strategic Income Fund (RSF) and RMK Multi-Sector High Income Fund (RHY). Dr. McCann testified on behalf of the Claimants.



Flanagan v UBS Financial Services - $200,000 Structured Products Award

In November 2009, a FINRA arbitration panel in Columbia, SC ordered UBS Financial Services Inc to pay $165,000 in damages which includes the interest per annum at the state of South Carolina statutory rate of 8.75%. The panel also awarded Claimant costs in the amount of $35,000 plus attorney's fees. The award was made after a hearing wherein the Claimant alleged Respondents breached contractual and fiduciary duties, failed to suitably invest Claimant's account, and failed to supervise Claimant's account. The claims related to the purchase of various Lehman Brothers issued "Principal Protected Notes" and "Return Optimization Notes" in the Claimant's account. Dr. McCann testified on behalf of the Claimant.



Wade et al v Morgan Keegan - $370,000 (MKHIX, MKIBX, RMH, RSF, RHY) Award

In November 2009, a FINRA arbitration panel in Birmingham, AL ordered Morgan Keegan to pay $370,000 in damages. The award was made after a hearing wherein the Claimants alleged Respondents breached contractual and fiduciary duties, failed to suitably invest Claimants' accounts, and failed to supervise Claimants' accounts. The claims related to Claimants' investments in the RMK Select High Income Fund (MKHIX), RMK Select Intermediate Bond Fund (MKIBX), RMK High Income Fund (RMH), RMK Strategic Income Fund (RSF) and RMK Multi-Sector High Income Fund (RHY). Dr. O'Neal testified on behalf of the Claimants.



Smythe et al v Morgan Keegan - $1,000,000 (MKIBX, RSF, RMA, RHY) Award

In November 2009, a FINRA arbitration panel in Memphis, TN ordered Morgan Keegan to pay $803,000 in damages including $20,000 in expert witness fees and pre-judgment interest at the rate of 6% per annum. The panel also assessed $195,160 in attorneys' fees. The award was made after a hearing wherein the Claimants alleged Respondents breached contractual and fiduciary duties, failed to suitably invest Claimants' accounts, and failed to supervise Claimants' accounts. The claims related to Claimants' investments in the RMK Select Intermediate Bond Fund (MKIBX), RMK Strategic Income Fund (RSF), RMK Advantage Income Fund (RMA) and RMK Multi-Sector High Income Fund (RHY). Dr. McCann testified on behalf of the Claimants.



Rivkin v Charles Schwab - $327,245 (SWYSX) Award

In October 2009, a FINRA arbitration panel in San Diego, CA ordered Charles Schwab to pay the Claimant $327,245. The award was made after a hearing wherein the Claimant alleged that Schwab misrepresented its YieldPlus (SWYSX) bond fund as a low risk alternative to a money market fund for cash holdings. Dr. Prendergast testified on behalf of the Claimant that the YieldPlus fund was much riskier than money market funds, that its portfolio was dominated by illiquid private-label mortgage backed securities containing considerable credit risk and that Schwab apparently overstated the fund's NAV in late 2007 and early 2008.



Eliot v Charles Schwab - $96,000 (SWYSX) Award

In September 2009, a FINRA arbitration panel in Los Angeles, CA ordered Charles Schwab to pay the Claimant $96,000 including $16,000 in expert witness fees. The award was made after a hearing wherein the Claimant alleged that Schwab misrepresented its YieldPlus (SWYSX) bond fund as a low risk alternative to a money market fund for cash holdings. Dr. McCann testified on behalf of the Claimant that the YieldPlus fund was much riskier than money market funds, that its portfolio was dominated by illiquid private-label mortgage backed securities containing considerable credit risk and that Schwab apparently overstated the fund's NAV in late 2007 and early 2008.



Nasatir v Charles Schwab - $125,729 (SWYSX) Award

In September 2009, a FINRA arbitration panel in Los Angeles, CA ordered Charles Schwab to pay the Claimant $125,729. The award was made after a hearing wherein the Claimant alleged that Schwab misrepresented its YieldPlus (SWYSX) bond fund as a low risk alternative to a money market fund for cash holdings. Dr. McCann testified on behalf of the Claimant that the YieldPlus fund was much riskier than money market funds, that its portfolio was dominated by illiquid private-label mortgage backed securities containing considerable credit risk and that Schwab apparently overstated the fund's NAV in late 2007 and early 2008.



Crow et al v Morgan Keegan - $148,000 (MKIBX) Award

In September 2009, a FINRA arbitration panel in Birmingham, AL ordered Morgan Keegan to pay $148,000 in damages including expert witness fees. The panel also assessed $30,825 in forum fees to the Respondents. The award was made after a hearing wherein the Claimants alleged Respondents breached contractual and fiduciary duties, failed to suitably invest Claimants' accounts, and failed to supervise Claimants' accounts. The claims related to Claimants' investments in the RMK Select Intermediate Bond Fund (MKIBX). Dr. McCann testified on behalf of the Claimants.



Chang v Charles Schwab - $88,245 YieldPlus (SWYSX) Award

In September 2009, a FINRA arbitration panel in Los Angeles, CA ordered Charles Schwab to pay the Claimant $88,245 including $13,500 in expert witness fees. The award was made after a hearing wherein the Claimant alleged that Schwab misrepresented its YieldPlus (SWYSX) bond fund as a low risk alternative to a money market fund for cash holdings. Dr. McCann testified on behalf of the Claimant that the YieldPlus fund was much riskier than money market funds, that its portfolio was dominated by illiquid private-label mortgage backed securities containing considerable credit risk and that Schwab apparently overstated the fund's NAV in late 2007 and early 2008. He also testified that the Claimant suffered $74,745 in damages measured against a portfolio of 100% Schwab Money Market Fund.



Kelly v Charles Schwab - $103,000 YieldPlus (SWYSX) Award

In August 2009, a FINRA arbitration panel in Reno, NV ordered Charles Schwab to pay the Claimant $103,000 including interest and fees. The award was made after a hearing wherein the Claimant alleged that Schwab misrepresented its YieldPlus (SWYSX) bond fund as a low risk alternative to a money market fund for cash holdings. Dr. McCann testified on behalf of the Claimant that the YieldPlus fund was much riskier than money market funds, that its portfolio was dominated by illiquid private-label mortgage backed securities containing considerable credit risk and that Schwab apparently overstated the fund's NAV in late 2007 and early 2008.



Mayes v Charles Schwab - $116,000 YieldPlus (SWYSX) Award

In August 2009, a FINRA arbitration panel in Houston, TX ordered Charles Schwab to pay the Claimant $116,000 including $16,000 in expert witness fees. The award was made after a hearing wherein the Claimant alleged that Schwab misrepresented its YieldPlus (SWYSX) bond fund as a low risk alternative to a money market fund for cash holdings. Dr. McCann testified on behalf of the Claimant that the YieldPlus fund was much riskier than money market funds, that its portfolio was dominated by illiquid private-label mortgage backed securities containing considerable credit risk and that Schwab apparently overstated the fund's NAV in late 2007 and early 2008.



Bach v Citigroup - $250,000 MAT V Award

In August 2009, a FINRA arbitration panel in Miami, FL ordered Citigroup to pay $250,000 in damages after a hearing wherein the Claimant alleged that Respondents breached contractual and fiduciary duties and negligently misrepresented MAT V, a leveraged municipal bond arbitrage fund. Dr. McCann testified on behalf of the Claimant.



Ross v Charles Schwab - $173,498 YieldPlus (SWYSX) Award

In July 2009, a FINRA arbitration panel in San Diego, CA ordered Charles Schwab to pay the Claimant $173,498 including $16,000 in expert witness fees. The award was made after a hearing wherein the Claimant alleged that Schwab misrepresented its YieldPlus (SWYSX) bond fund as a low risk alternative to a money market fund for cash holdings. Dr. McCann testified on behalf of the Claimant that the YieldPlus fund was much riskier than money market funds, that its portfolio was dominated by illiquid private-label mortgage backed securities containing considerable credit risk and that Schwab apparently overstated the fund's NAV in late 2007 and early 2008.



Lanfear v Global Crown Capital - $1,688,000 Award

In July 2009, a FINRA arbitration panel in San Francisco, CA ordered Global Crown Capital and its principal to pay the Claimant $1,688,000. The award was made after a hearing wherein the Claimant alleged that Global Crown churned Claimant's securities accounts and a sham hedge fund offered as Cogent Hedge Fund in which the Claimant was the primary investor. Dr. McCann testified on behalf of the Claimant that the securities accounts and the hedge fund was churned and that the Claimant thereby suffered at least $1.7 million in damages.



United Prison Ministries v Morgan Keegan - $220,000 (MKHIX) Award

In June 2009, a FINRA arbitration panel in Birmingham, AL ordered Morgan Keegan to pay $220,000 in damages including $20,000 in expert witness fees. The award was made after a hearing wherein the Claimants alleged Respondents breached contractual and fiduciary duties, violated the Alabama Securities Act, failed to suitably invest Claimants' accounts, and failed to supervise Claimants' accounts. The claims related to Claimants' investments in the RMK Select High Income Fund (MKHIX). Dr. O'Neal testified on behalf of the Claimant.



Klosky v Morgan Keegan - $134,000 (RMH, RSF, RMA, RHY, MKHIX, MKIBX) Award

In June 2009, a FINRA arbitration panel in Memphis, TN ordered Morgan Keegan to pay $134,000 in damages after a hearing wherein the Claimants alleged Respondents breached contractual and fiduciary duties, violated Tennessee Blue Sky Laws and the Tennessee Consumer Protection Act and committed common law fraud and misrepresentation. The claims related to Claimants' investments in the RMK Intermediate Bond Fund (MKIBX). Dr. O'Neal testified on behalf of the Claimant.



Richardson v Morgan Keegan - $431,000 (MKHIX, MKIBX) Award

In June 2009, a FINRA arbitration panel in Boca Raton, FL ordered Morgan Keegan to pay $431,000 in damages after a hearing wherein the Claimants alleged Respondents breached contractual and fiduciary duties, failed to suitably diversify Claimants' accounts and failed to supervise Claimants' accounts in the Claimants' investments in RMK Select High Income Fund (MKHIX) and RMK Select Intermediate Bond Fund. Dr. McCann testified on behalf of the Claimants.



Velez v Morgan Keegan- $75,000 RMH, RHY, RSF, RMA Award

In May 2009, a FINRA arbitration panel in Little Rock, AR ordered Morgan Keegan to pay $75,000 in damages after a hearing wherein the Claimants alleged Morgan Keegan breached contractual and fiduciary duties, failed to suitably diversify Claimants' accounts and failed to supervise Claimants' accounts in the Claimants' investments in RMK High Income Fund (RMH), RMK Multi-Sector High Income Fund (RHY), RMK Strategic Income Fund (RSF), RMK Advantage Income (RMA). Dr. McCann testified on behalf of the Claimants.



CASE Credit Union v Prudential - $1,028,443 Interest-Only CMO Award

In May 2009, a FINRA arbitration panel in Detroit, MI ordered Prudential to pay $1,028,443 in damages and interest after a hearing wherein the Claimant alleged Respondents sold the Claimant an unsuitable, overpriced Interest-Only CMO strip. Dr. McCann testified on behalf of the Claimants.



Humphries v Morgan Keegan- $285,222 (MKIBX) Award

In May 2009, a FINRA arbitration panel in Jackson, MS ordered Morgan Keegan to pay $285,222 in damages, interest and attorneys' fees after a hearing wherein the Claimants alleged Respondents misrepresented the RMK Select Intermediate Bond Fund (MKIBX). Dr. McCann testified on behalf of the Claimants.



Ackerman, et al v Morgan Keegan - $81,169 (MKHIX) Award

In April 2009, a FINRA arbitration panel in Birmingham, AL ordered Morgan Keegan to pay $81,169 in damages and interest after a hearing wherein the Claimants alleged Respondents breached contractual and fiduciary duties, failed to suitably diversify Claimants' accounts and failed to supervise Claimants' accounts in the Claimants' investments in Regions MK Select High Income Fund (MKHIX). Dr. McCann testified on behalf of the Claimants.



Brezden et al v Associated Securities - $8.9 Million Hedge Fund Award

In March 2009, a FINRA Dispute Resolution panel, in an explained decision, awarded $8.9 million to a group of Claimants who invested in an speculative options trading vehicle called APEX Equity Options Fund, LP. The panel concluded that the broker, who was also a registered investment advisor, deliberately misled these customers by telling them Apex was a safe, income-producing security. In fact, the fund was very risky, and the Claimants lost their entire investment. The panel also found the broker's employer, Associated Securities Corp., independently liable for its failure to supervise the broker. On behalf of the Claimants, Mr. Meyer testified about a firm's duties to supervise.



Willingham et al v Morgan Keegan - $187,215 (RHY, MKIBX) Award

In March 2009, a FINRA arbitration panel in Birmingham, AL ordered Morgan Keegan to pay $187,215 in damages after a hearing wherein the Claimants alleged Respondents breached contractual and fiduciary duties, failed to suitably diversify Claimants' accounts and failed to supervise Claimants' accounts in the Claimants' investments in RMK Multi-Sector High Income Fund (RHY) and RMK Select Intermediate Bond Fund. Dr. McCann testified on behalf of the Claimants.



Muhlbauer v Morgan Keegan - $125,000 (RHY, RSF, RMA) Award

In March 2009, a FINRA arbitration panel in Memphis, TN ordered Morgan Keegan to pay $125,000 in damages after a hearing wherein the Claimants alleged Respondents breached contractual and fiduciary duties, failed to suitably diversify Claimants' accounts and failed to supervise Claimants' accounts in the Claimants' investments in RMK Multi-Sector High Income Fund (RHY), RMK Strategic Income Fund (RSF) and RMK Advantage Income (RMA). Dr. O'Neal testified on behalf of the Claimant.



McCarver v Morgan Keegan - $100,000 (RMH, RHY, RSF, RMA, MKHIX) Award

In February 2009, a FINRA arbitration panel in Tampa, FL ordered Morgan Keegan to pay $100,000 in damages after a hearing wherein the Claimants alleged Respondents breached contractual and fiduciary duties, failed to suitably diversify Claimants' accounts and failed to supervise Claimants' accounts in the Claimants' investments in RMK High Income Fund (RMH), RMK Multi-Sector High Income Fund (RHY), RMK Strategic Income Fund (RSF), RMK Advantage Income (RMA) and RMK Select High Income (MKHIX). Dr. McCann testified on behalf of the Claimant.



Misha v Stone & Youngberg - $250,000 Leveraged Municipal Bond Arbitrage Award

In January 2009, a FINRA arbitration panel in San Francisco, CA ordered Stone & Youngberg to pay $250,000 in damages after a hearing wherein the Claimants alleged Respondents breached contractual and fiduciary duties and negligently misrepresented a leveraged municipal bond arbitrage strategy. Dr. McCann testified on behalf of the Claimants.



Coutant and Goheen v Morgan Stanley Dean Witter et al - $1.016 Million Concentration Award

In February 2008, a FINRA arbitration panel in San Francisco, CA ordered Morgan Stanley to pay $1,015,875 after a hearing wherein the Claimants alleged Respondents failed to provide competent hedging advice with respect to the Claimants' concentrated stock holdings. Dr. McCann testified about principles of prudent investment management, hedging strategies and damages on behalf of the Claimants.



Lackey v Casimir Capital and James Ahern - $94,500 Churning Award

In December 2007, a FINRA arbitration panel in Dallas, TX ordered Casimir Capital and James Ahern to pay $94,500 including expenses and attorney fees after a hearing wherein the Claimants alleged Respondents churned the Claimants' accounts. Dr. McCann testified to the egregiousness of the churning on behalf of the Claimants.



Riley v Associated Securities - $605,000 Asset Allocation Award

In November 2007, a FINRA arbitration panel in Reno, NV ordered Associated Securities and Patricia Meidell to pay $605,000 in damages and interest after a hearing wherein the Claimants alleged Respondents breached contractual and fiduciary duties and failed to suitably diversify Claimant's account. Dr. McCann testified on behalf of the Claimant.



McKinney v Merrill Lynch - $3.321 Million Concentration / Variable Prepaid Forward Award

In October 2007, a FINRA arbitration panel in Indianapolis, IN ordered Merrill Lynch to pay $3.321 million to a Claimant. Claimant alleged that Merrill Lynch recommended that she purchase investments on margin despite holding a concentrated single-stock position and that Merrill Lynch engaged in self-dealing by causing her to enter into a complex, costly and unsuitable liquidity contract (variable prepaid forward). Dr. McCann testified on behalf of the Claimant.

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Piscevich et al v Associated Securities - $450,000 Asset Allocation Award

In July 2007, an NASD arbitration panel in Reno, NV ordered Associated Securities and Patricia Meidell to pay $460,000 in damages after a hearing wherein the Claimants alleged Respondents breached contractual and fiduciary duties and failed to suitably diversify Claimants' account. Dr. McCann testified on behalf of the Claimants.



Rayburn et al v HSBC Securities - $775,000 Structured Products Award

In May 2007, an NASD arbitration panel in Los Angeles, CA ordered HSBC Securities to pay $775,000 in damages after a hearing wherein the Claimants alleged Respondents misrepresented features and omitted material facts in the sale of structured "snowball" notes to Claimants. Dr. McCann testified on behalf of the Claimants.



Schunmann v Donald Sowa - Misrepresentation $314,000 Award

In April 2007 an NASD Arbitration panel in Hartford, CT ordered Donald Sowa, an RIA, to pay Mr. and Mrs. Schunmann compensatory damages of $314,000. Dr. O'Neal testified that the RIA misrepresented and completely misunderstood the risk of the Schunmann's portfolio.



Almquist at al v Merrill Lynch - $1.5 million Award

In February 2007, an NASD arbitration panel in Seattle, WA ordered Merrill Lynch to pay $1.5 million to a couple after a hearing wherein the Claimants alleged Merrill Lynch breached contractual and fiduciary duties and failed to make suitable recommendations to diversify their account.



Nolan v Merrill Lynch - $1.775 Million Concentration Award

In October 2006, an NASD arbitration panel in San Francisco, CA ordered Merrill Lynch to pay $1.775 million to a Claimant. Claimant alleged that Merrill Lynch failed to provide suitable recommendations for hedging or diversifying a concentrated Dell stock position during and after a lockup period. Dr. McCann testified on behalf of the Claimants.



Cherry et al v Raymond James Annuity - $577,000 Award

In October 2006, an NASD arbitration panel in Birmingham, AL ordered Raymond James to pay seven Claimants $577,000 in out of pocket losses plus attorney fees, expert witness fees and interest over the sale of annuities into IRA rollovers.



Bouse et al v Wedbush Morgan Securities, Inc. - $3.8 million CMO Award

In May 2006, an NASD arbitration panel in Los Angeles, CA ordered Wedbush to pay 22 clients of its Newport Beach branch and their attorneys $3.8 million. Wedbush sold Claimants lower tranche manufactured housing CMOs as good substitutes for bank CDs, suitable for "widows and orphans." Dr. McCann testified that the CMO's were highly speculative and not suitable for risk adverse bond investors. He also testified that this failure to make complete and accurate disclosures was a breach of the fiduciary duty owed to brokerage firm customers.



Yellen et al v Citigroup Global Markets (SSB) - $536,500 Award

In May 2006, an NASD arbitration panel in Tampa, FL ordered Citigroup to pay Barry Yellen and his advisory clients $462,500 in compensatory damages, plus at least $74,000 in prejudgment interest. Dr. McCann testified that Jack Grubman manipulated his valuation methodologies to double his valuation on WorldCom in the face of deteriorating fundamentals at WorldCom.



Stockhausen v Citigroup Global Markets (SSB), Jack Grubman - $452,363 Award

In May 2006, an NASD arbitration panel in Chicago, IL ordered Citigroup to pay Joseph and Karen Stockhausen $325,000 in compensatory damages, $97,500 in attorneys' fees and $29,863.64 in costs. Dr. McCann testified that the exercise and hold strategy for handling non-qualified stock options is almost always unsuitable, that Jack Grubman manipulated his valuation methodologies to double his valuation on WorldCom in the face of deteriorating fundamentals at WorldCom and that the Stockhausens suffered $325,000 in market adjusted losses.



Carruthers v Citigroup Global Markets (SSB) - $900,000 Award

In February 2006, an NASD arbitration panel in Cleveland, OH ordered Citigroup to pay Suzanne and Joseph Carruthers $900,000. The Carruthers had alleged that SSB provided flawed and biased proposals designed to influence them to choose a more risky asset mix than they would have chosen had SSB made a full and balanced proposal. Dr. McCann testified that SSB's Consulting Group investment presentations were incomplete and biased. He also testified that the Carruthers suffered $900,000 in damages measured against a balanced portfolio of 60% stocks and 40% bonds.



Bauer v Raymond James Annuity - $453,210 Award

In October 2005, an NASD arbitration panel in Philadelphia, PA order Raymond James to pay a Claimant $151,070 in out of pocket losses plus $302,140 in punitive damages - plus attorney fees, expert witness fees and prejudgment interest over the sale of Equitable and Manulife variable annuities.



AG Edwards Exercise and Hold - $931,000 Award

In May 2005, a Pacific Stock Exchange arbitration panel in San Francisco, CA ordered AG Edwards to pay four Claimants $931,000 plus plus costs over the unsuitable recommendation to exercise employee stock options on margin and to hold the aquired Cisco Systems and JDS Uniphase stock for one year to achieve long-term capital gains tax treatment.



Desrosiers v Robert W. Baird, Inc. - Account Mismanagement $400,000 Award

In April 2005 an NASD Arbitration panel in Tampa, FL ordered Baird to pay Ms. Desrosiers compensatory damages of $400,000 plus interest. Dr. O'Neal testified that the risk of the portfolio was inappropriate for Ms. Desrosiers and that Baird disregarded its own published materials on the importance of asset allocation and understanding risk.



Salomon Smith Barney Exercise & Hold Case - $2.5 Million Award

In March 2005, an NASD arbitration panel in Washington, DC awarded a Claimant $2.5 million including $500,000 in punitive damages arising out of claims against Salomon Smith Barney over the exercise of non-qualified employee stock options by a former MCI Worldcom employee.



Cox v Bush - $630,000 Asset Allocation Award

In January 2005, an NASD arbitration panel in Washington, DC ordered J. Bush & Co. to pay Claimants $630,000 in damages. Claimant alleged J. Bush & Co. invested their retirement assets in an unsuitably risky manner. Dr. McCann testified on behalf of the Claimants.



Salomon Smith Barney/Spartis/Elias Exercise & Hold Case - $448,000 Award

In January 2005, an NASD arbitration panel in Lexington, KY awarded a Claimant $448,000 arising out of claims against Salomon Smith Barney, Philip Spartis and Amy Elias over the exercise of non-qualified employee stock options by a Worldcom employee.



Brush et al v Merrill Lynch - $1.1 Million 72(t) Award

In December 2004, an NASD arbitration panel in Indianapolis, IN ordered Merrill Lynch to pay $1.1 million including $450,000 in punitive damages to a group of Claimants in a 72(t) case. The panel found that Merrill Lynch failed to properly train and supervise their brokers and provided brokers with deceptive tools to use when advising clients whether to retire and how aggressive their retirement portfolios should be. Dr. McCann testified on behalf of the Claimants.



Rooney v Wachovia Securities, LLC - Fraud, Breach of Fiduciary Duty $567,000 Award

In November 2004 an NASD Arbitration panel in Los Angeles, CA ordered Wachovia to pay Mr. and Mrs. Rooney compensatory damages of $189,000, and an additional $378,000 in punitive damages. Dr. O'Neal testified on the use of inappropriate mutual fund share classes and on costly switching among various mutual funds that showed nearly identical return patterns.



Berry et al v Merrill Lynch - $752,000 72(t) Award

In September 2004, an NASD arbitration panel in Indianapolis, IN ordered Merrill Lynch to pay $752,000 including $191,000 in punitive damages to a group of Claimants in a 72(t) case. The Claimants alleged that Merrill Lynch failed to properly train and supervise their brokers and provided brokers with deceptive tools to use when advising clients whether to retire and how aggressive their retirement portfolios should be. Dr. McCann testified on behalf of the Claimants.



Hatch v H&R Block Financial Advisors - $507,937 Churning Award

In September 2004, an NASD arbitration panel in Southfield, MI ordered H&R Block Financial Advisors to pay the Claimant $507,937 in compensatory damages and costs. Dr. McCann testified on behalf of the Claimant that the Claimant's securities portfolio was churned and estimated damages.



Bokan v Merrill Lynch, Pierce, Fenner & Smith, Inc. - Suitability $405,000 Award

In March 2004 an NASD Arbitration panel in Boca Raton, FL ordered Merrill Lynch to pay Mr. Bokan compensatory damages of $366,000 plus interest. The panel also awarded Mr. Bokan $39,000 in travel costs and expert witness fees incurred.



District Court Grants Defendants' Motion for Summary Judgment in WAXS Class Action

In March 2004, the United States District Court for the Northern District of Georgia granted the Defendants' motion for summary judgment in what was left of twenty-three class actions against World Access (WAXS). The Court found that WAXS's statements concerning a switch designed for developing markets were not false and misleading. The Court went on to conclude that, in any case, the statements were not material based on an event study performed by Dr. McCann. The Court said that when allegedly false and misleading statements do not cause a statistically significant price increase during the class period, Plaintiffs can not demonstrate materiality of the alleged misrepresentations by looking at an allegedly curative disclosure if those disclosures contained a lot of additional negative information.



Lopez v Merrill Lynch - $6.4 Million Exercise & Hold Award

In February 2004 an NASD arbitration panel in Dallas awarded four Claimants $6.4 million arising out of claims against Merrill Lynch over the exercise of non-qualified employee stock options by Allegiance Telecom employees.



Wendling v Merrill Lynch - $1.73 Million Exercise & Hold Award

In October 2003 an NASD arbitration panel in Seattle awarded a husband and wife $1.73 million arising out of claims against Merrill Lynch over the exercise of Ariba non-qualified employee stock options.



Cote v Edward Jones - $90,367 Exercise & Hold Award

In August 2003, an NASD arbitration panel in Dallas, TX ordered Edward Jones to pay Claimant $90,367 including costs and prejudgment interest. Dr. McCann testified that the exercise and hold strategy was deeply flawed and should never have been implemented.



Bauer v Morgan Stanley Dean Witter - $175,000 NYSE Award

In August 2002, an NYSE arbitration panel in Memphis, TN ordered Morgan Stanley Dean Witter to pay Claimant $175,000. Dr. McCann testified for the Claimants.



Millar v Merrill Lynch - $7.74 Million JAMS Award

In July 2002 a JAMS arbitration panel awarded a couple $7.74 million arising out of claims of breach of contract, negligence and fraud against Merrill Lynch. The panel found that Merrill Lynch breached duties to formulate and implement suitable investment strategies. The panel also found that Merrill Lynch failed to offer and explain hedging strategies suitable to the Claimants' objectives prior to the expiration of a post-IPO lockup. Finally, the panel found that Merrill Lynch's covered call writing was not a suitable strategy for dealing with the Claimants' concentrated position. This award has been mischaracterized as a simple failure to execute a sell order case. We have posted the award so that you can read the panel's conclusions for yourself.



District Court Affirms $7.74 Million Award Against Merrill Lynch

The award in Millar v Merrill Lynch was noteworthy, and not only for its size. The panel decided Merrill Lynch breached a contract to provide suitable investment advice to the Millars. Merrill Lynch appealed the award. The District Court in affirming the award recently made clear that brokerage firms cannot sell themselves as offering world class investment advice, even to customers like the Millars with non-discretionary accounts, and then claim to be only order takers when they deliver negligent or incompetent advice.



Garcia v AG Edwards - $571,159 Churning Award

In December 2001, an NASD arbitration panel in Boca Raton, FL ordered AG Edwards to pay the Claimant at least $571,159 including compensatory damages and prejudgment interest. Dr. McCann testified that the securities portfolio was churned and estimated damages.



Wolfe v Considine - $424,183 Award

In December 2001, an NASD arbitration panel in Baltimore, MD ordered the Respondent to pay the Claimant $424,183 in damages after a hearing wherein the Claimant alleged that Respondents churned Claimant's account and invested in unsuitable securities. Dr. McCann testified on behalf of the Claimant.



Stanton v Cendant - $18.8 Million Securities Fraud Award

In February 2001, a AAA arbitration panel in New York, NY ordered Cendant to pay $18.8 million to Claimants who sold their closely-held business, Dine-a-Mate, to Cendant for shares of stock during a pervasive accounting fraud. Dr. McCann testified on behalf of the Claimants.



Mueller v Gaines Berland - $372,922 Texas Securities Act Award

In February 2001, an NASD arbitration panel in Dallas, TX ordered Gaines Berland to pay Claimant $392,922 including attorney's fees and expert witness costs for violation of the Texas Securities Act and the Texas Deceptive Trade Practices Act. Dr. McCann testified for the Claimant.



Johnson v Ryan, Lee & Co. - $385,000 Award

In December 2000, an NASD arbitration panel in Washington, DC ordered Ryan, Lee to pay the Claimant $385,000. Dr. McCann testified on behalf of the Claimant.



Maderazo v Piper Jaffray - $139,500 Award

In October 2000, an NASD arbitration panel in Scottsdale, AZ ordered Piper Jaffray to pay Claimants $139,500 including attorneys' fees and expert witness costs. Dr. McCann testified on behalf of the Claimants.



Haaz v Oppenheimer - $491,707 Churning Award

In November 1998, an NASD arbitration panel in Philadelphia, PA Oppenheimer to pay Claimant $454,293 in compensatory damages and at least $37,414 in prejudgment interest. Dr. McCann testified that the account was churned and the trading costs should be adjusted to reflect the investment returns the trading costs would have earned if left in the portfolio instead of being taken by the Respondents. The explanation of this market adjusted trading cost measure can be found in an SLCG working paper McCann on Churning. The panel awarded Dr. McCann's measure of churning damages.