Responding to substantial pressure from regulators and the investing public, the brokerage firm Charles Schwab reversed itself and eliminated the class action waiver clause from its pre-dispute arbitration clause in its customer account agreements. See news coverage here. Readers of this blog know from my previous posts that in early 2012 FINRA brought a disciplinary action against Schwab for violating its rules that bar class action waivers in customer agreements. A hearing panel concluded that, while Schwab’s actions did in fact violate FINRA conduct rules, the Federal Arbitration Act precluded enforcement of those rules. That ruling is currently on appeal before FINRA’s National Adjudicatory Council with a decision not expected until late this year. Professor Barbara and I recently filed an amicus brief in that appeal in support of FINRA Enforcement arguing the hearing panel wrongly decided that the FAA bars enforcement of FINRA rules.

Because the ruling threatens to cripple the ability of FINRA to regulate securities arbitration and thus weaken investor protection, federal legislators, state securities regulators, and investor advocacy groups have once again urged the SEC to exercise its authority to eliminate mandatory securities arbitration. Schwab’s strategic misstep may end up being the straw that broke the camel’s back.

Stay tuned for the next installment of FINRA v. Schwab!

    

OJ Simpson will be back in court this week in Las Vegas bringing an appeal from his 2008 armed robbery and kidnapping conviction in 2008.  He has apparently filed, through his new lawyer, a 94-page petition for a new trial—which reportedly includes 19 specific issues that the court has agreed to hear “mostly claiming that lawyer Yale Galanter provided such poor representation that Simpson deserves a new trial.”  For more information, see here.

One interesting point is the issue of whether Simpson’s lawyer failed to convey a plea offer.  Simpson is reportedly stating that if the offer had been conveyed, he would have taken it rather than going forward with trial.  This is essentially the same scenario of Missouri v. Frye, a case the US Supreme Court decided in the last term in which they held that the failure to convey the offer constituted ineffective assistance of counsel.  I blogged about that decision here .

The twist in the current OJ Simpson appeal is that the prosecutor is reportedly denying there were serious plea negotiations which would mean Simpson’s defense lawyer did not fail to convey any offer as there wasn’t a specific offer made.  This might lead to an even more interesting question: Is it ineffective assistance of counsel if a defense lawyer does not negotiate a plea offer in a case?  Clearly there are cases where the prosecutor will make no offer due to the charges (murder cases are frequently in this category).  But, Simpson’s case doesn’t seem to fall into the category of the type of case where no offer would be made.  In these circumstances, is it the defense lawyer’s duty to negotiate an offer, even if their client says they don’t want one?   I know that when I was a public defender I considered it my job to negotiate the best offer possible for every case.  I had a lot of clients who initially told me “no deals” but when confronted with the reality of going to trial became very willing to take a deal.  It would seem to me that negotiating a firm plea offer is something defense lawyers should be striving to do as part of their basic preparation in every case.

But, the Simpson appeal may not reach this question.

    

Back in the day Kevin Underhill and I were young associates at large law firms in Kansas City and living the life that only single people with lots of disposable income can.  Now he’s a big time lawyer in San Francisco and has the funniest legal blog there is – Lowering the Bar - and I’m simply wishing I could be half as funny as Kevin.  On Fridays he sends out an email with the week’s strangest legal stories and this one about power imbalances in negotiation caught my eye.  Thanks Kevin for keeping me in stitches over the years.

For the full post and more of a laugh, go here.

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TIP: If You’re Standing in Front of a Car, You Are In a Poor Negotiating Position

On the other hand, it could get significantly worse:`

Just to be clear, that car is not parked. It is traveling down a road in Roswell, Georgia, at what I would guess is around 45 mph. The hood ornament is a Mr. Elton Kim, who saw the driver of said car back into his wife’s SUV and unwisely chose to confront the driver. Well, it wasn’t so much the confrontation that was unwise as the location he chose: directly in front of the woman’s car. When she accelerated, Kim jumped onto the hood, and away they went.

“His objective was to have her stop,” said his wife unnecessarily, “not to go for a joyride.” You wouldn’t know it, though, from his demeanor, as he appears to be reasonably calm despite the fact that he is clinging to the hood of a moving car. Granted, it’s not like there was a whole lot he could do physically during that time, but he isn’t screaming or anything like that. I’d like to think he was able to enjoy himself at least to some extent.

He does shout “call the police!” to the guy taking the video (from a car driving alongside), who responds “I will!” but then also shouts back, “Did you call them yet?!” Yes, I just fished out my cellphone and called them with one hand while I was clinging to the hood of this moving car, jackass. I also texted them and did a quick Twitter update. Does it matter? I don’t think the cops’ll be too upset if they get more than one call about somebody clinging to the hood of a moving car, so why don’t you STOP FILMING ME AND CALL THE POLICE?! Unbelievable.

    

Dear all, as I just sent out to our listserve as well, it is time to remind you of the Boskey Competition for two reasons–(a) I need your students to submit essays; and (b) you might be right now in the midst of grading the next competition winner as we speak.

This competition offers your students a chance to achieve both fame and fortune by writing a good essay pertaining to dispute resolution. Please encourage your students who have written good papers this year to submit them to the competition. The deadline for submission is June 14, 2013.   Details of the competition can be found here.

Happy Grading (and Happy Summer!)–Andrea

    

Once again, a bill to ban mandatory arbitration of consumer, employment and civil rights disputes has been introduced into both houses of Congress. It is sponsored by Sen. Al Franken (D-MN) and Rep. Hank Johnson (D-GA). The text is not yet available, but the press release states the following:

“What the Arbitration Fairness Act Does:

• Restores the original intent of the FAA by clarifying the scope of its application.
• Amends the FAA by adding a new chapter invalidating agreements that require the arbitration of employment, consumer, or civil rights disputes made before the dispute arises.
• Restores the rights of workers and consumers to seek justice in our courts.
• Ensures transparency in civil litigation.
• Protects the integrity of the Civil Rights Act, the Equal Pay Act, the Americans with Disabilities Act, and the Age Discrimination in Employment Act, among others.”

See Rep. Johnson’s press release.