Litigation
Chapters in this video
- 0:00 When Carla goes to court: three exceptions
- 1:10 The class action exam trap
- 2:19 Riley and Sam: mandatory arbitration for industry
- 3:12 Court versus FINRA arbitration comparison
- 4:10 Speed, cost, and the 12-18 month timeline
- 4:47 CRD reporting and private proceedings
- 5:08 The appeal illusion: arbitration finality
- 5:59 Rapid-fire exam recap
What this video covers
- The three exceptions that allow a customer to bypass Financial Industry Regulatory Authority (FINRA) arbitration and file in state or federal court: class actions, absence of a predispute arbitration agreement, and certain statutory claims
- Why class action claims are the single most testable litigation trigger, and why FINRA arbitration never handles them
- Why industry participants (firms and registered representatives) are generally locked into mandatory FINRA arbitration with no court option
- How discovery, rules of evidence, speed, cost, decision-maker, and public record differ between litigation and FINRA arbitration
- Why arbitration typically resolves in 12 to 18 months compared to the multi-year timeline of traditional court cases
- The Central Registration Depository (CRD) reporting requirement for arbitration awards versus the privacy of the underlying proceedings
- Why arbitration awards have extremely limited appeal rights and cannot be challenged on the merits, the most dangerous trap on the exam
Read the full lesson, free
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