California FINRA Arbitration Attorney
Most disputes between investors and the brokerage firms that lost their money cannot be filed in court. The customer agreement signed when the account was opened often sends them to FINRA arbitration: a private forum administered by the Financial Industry Regulatory Authority, with its own rules, its own arbitrators, and its own discovery process.
Rosenberger + Kawabata represents California investors in FINRA arbitration. We handle every stage of the case: intake, statement of claim, discovery, briefing, hearing, and post-award collection. Same attorneys from start to finish.
How FINRA Arbitration Works
A FINRA arbitration begins when the claimant files a Statement of Claim with FINRA Dispute Resolution Services. The respondent (typically the broker, the brokerage firm, or both) has 45 days to answer. After answering, the parties select arbitrators from FINRA’s roster.
Discovery is more limited than in court. FINRA’s Code of Arbitration Procedure governs document requests and depositions, with its own Discovery Guide listing presumptively producible documents. Pre-hearing motions are generally disfavored. The case typically moves to a hearing within 12 to 18 months of filing, where the arbitrators hear evidence, review exhibits, and issue a written award.
Awards are binding and enforceable in court. There is no appeal on the merits. The grounds for vacating an award under the Federal Arbitration Act are narrow.
What Investors Can Recover
Damages in FINRA arbitration depend on the theory of the case and the type of broker misconduct alleged. The most common categories:
Out-of-pocket losses. The difference between what the investor paid and what the position is worth at the time of the claim. The starting point in nearly every case.
Well-managed-portfolio damages. What a suitable portfolio would have returned over the same period, less the actual return. Used where the broker’s recommendations themselves caused the loss, not just market movement.
Interest, costs, and attorneys’ fees. May be available by statute or at the arbitrator’s discretion under FINRA’s authority to apportion fees and costs.
Punitive damages. Available where the conduct supports them: intentional misrepresentation or reckless disregard for the customer’s interests, including investment fraud.
Statutory enhancements. California elder financial abuse may add up to treble damages and attorneys’ fees.
FAQs
How long does FINRA arbitration take?
Most cases reach hearing within 12 to 18 months of filing, with the award issued shortly after. Larger or more complex matters can run longer if the parties agree to a more involved discovery schedule. Compared to civil litigation in California state or federal court, the timeline is significantly compressed.
How much does FINRA arbitration cost?
Our FINRA arbitration cases are taken on a contingency, hourly, or hybrid basis. Fees are discussed openly in the initial consultation.
What is the deadline to file?
FINRA Rule 12206 sets a six-year eligibility window measured from the occurrence or event giving rise to the claim. California’s substantive statutes of limitations on the underlying causes of action can be shorter. Both clocks need to be analyzed before filing. Acting promptly preserves the broadest range of claims.
What if the broker is no longer registered?
The brokerage firm can remain responsible for the conduct of its registered representatives during the period of registration. Even if the individual broker has been barred or has left the industry, the firm may be held liable for failure to supervise under FINRA Rules 3110 and 3120. In most cases the firm is the more collectible defendant in any event.
Talk to a California FINRA Arbitration Lawyer
If you lost money on investments your broker recommended and you want to understand whether you have a claim, contact us. Call (310) 894-6921 or submit an inquiry through our contact form.