Securities Law and Arbitration: The Enforceability of Predispute Arbitration Clauses in Broker-Customer Agreements

Monday, January 1st, 1990 at 12:00 am by Margo E.K. Reder
Margo E.K. Reder, Securities Law and Arbitration: The Enforceability of Predispute Arbitration Clauses in Broker-Customer Agreements, 1990 Colum. Bus. L. Rev. 91

This article explores the alternative dispute resolution technique of arbitration as it is employed in broker-customer securities disputes. Historically, such disputes have been resolved in judicial forums, but increasingly courts are compelled to turn over such cases to arbitration associations. In the typical scenario involving arbitration of securities disputes, the investor/customer loses money on an investment in publicly traded securities, and later brings an action in federal district court attempting to recoup losses. The brokerage house will then seek a stay of the litigation and an order compelling arbitration as per the predispute arbitration agreement executed by the parties upon the opening of the account.

Author Information

Adjunct Assistant Professor of Law, Bentley College. B.A. Univ. of Mass. at Amherst, 1980; Dipl. London School of Economics and Political Science, 1982; J.D. Suffolk Univ. Law School, 1988.