FINRA Arbitration No. 12-01252, decided March 25, 2014. Represented an “ex-pat” registered representative who had worked in the Tokyo, Japan office of a major brokerage firm pursuant to an employment agreement and a deferred compensation plan. In the turmoil of the market in 2008, the broker was forced out of a seven-figure position, his employment contract breached by the firm. Litigating alone against two lawyers from a major, 1,400-lawyer international law firm, Mr. Gelber prevailed after nine hearing sessions conducted over five days. The Panel awarded Mr. Gelber’s client more than $333,000.00.in compensatory damages.
FINRA Arbitration No. 11-03675, decided March 14, 2013. Defended a New York based brokerage firm against a claim for "damages" resulting from a "buy-in" of a sub-penny stock. The claim was brought by a Texas speculator who had acquired the stock directly from the issuer. The buy-in (following the sale of millions of shares of the stock, which traded in "milles") was the result of a clearing firm policy concerning such high-risk sub-penny stocks. Mr. Gelber, at a two day evidentiary hearing in Houston, Texas, successfully defeated Claimant's effort to hold the brokerage firm responsible for the clearing firm's policies by showing that (i) his client complied fully with all its obligations, and (ii) by highlighting the investor's trading patterns. The Panel not only denied the claims in their entirety, but it assessed 100% of the hearing session fees, including the pre-hearing conferences, against the Claimant.
FINRA Arbitration No. 11-01229, decided June 22, 2012. Represented New York based brokerage firm and Michigan based registered representative in defense of claim of unsuitability brought by a couple who had placed funds into a private placement of a note-based security. The issuer had evidently used investors' funds for personal benefits, causing claimants to lose their entire investment. Mr. Gelber successfully defeated their effort to hold his clients responsible for the violations of the issuer by methodically demonstrating at a full evidentiary hearing over the course of 2 ½ days that (i) his brokerage clients complied fully with all their obligations, including due diligence, and (ii) the claimants had intentionally and knowingly misrepresented their investment parameters in order to induce the brokerage firm to allow them to purchase the notes for their own account and risk. The Panel denied the claims in their entirety.
FINRA Arbitration No. 11-00052, decided March 5, 2012. Represented a married couple in an "unauthorized sales" arbitration claim against a major brokerage firm in a classic "we said / they said" contest. At a full evidentiary hearing that lasted almost three days, Mr. Gelber was able to undermine the credibility of the broker and overcome a strong "failure to mitigate" defense. The Panel awarded Mr. Gelber's clients a quite satisfactory sum. Damages appeared to be based on the amount Mr. Gelber's clients were deprived of when the broker sold certain long-term bond positions at the depths of the market crisis in 2008 without obtaining proper authority for the sale.
FINRA Arbitration No. 09-05218, decided June 8, 2010. Case brought by bond trading firm seeking to rescind a bond trade 4 ½ years after the trade date, but within the 6-year eligibility rule and Ohio 6-year statute of limitations on contract, on the ground of "mutual mistake" under Ohio law. Mr. Gelber's client, another bond trading firm, sold the bond in a riskless principal transaction. Each side had access, at the time of the trade, to information published by Bloomberg. There was testimony that Bloomberg had omitted an applicable sinking fund schedule, creating the alleged "mutual mistake" - an error in the value (but not the price) of the bond. After Mr. Gelber tried the case at a full evidentiary hearing, the Ohio Panel ruled fully in favor of Mr. Gelber's client, ruling the claims were "denied and dismissed, with prejudice."
In Re Optionable Securities Litigation. (June 15, 2009). After Judge Kaplan’s decision at 577 F. Supp.2d 681 (S.D.N.Y 2008) dismissing the class action, plaintiffs moved under Rule 60(b) to reopen the case alleging “newly discovered evidence”. After reviewing the briefs of the parties and hearing oral argument, Judge Paul Crotty, who was assigned this aspect of the case, denied the motion, and thus permanently closed the door on the class action. Judge Crotty’s decision can be reviewed by clicking here. securities.stanford.edu/1037/OPBL_01/2009615_r01m_073753.pdf
In re Optionable Securities Litigation,
577 F. Supp.2d 681 (S.D.N.Y 2008)
In this federal securities fraud class action, Mr. Gelber represented the former CEO of Optionable, Inc (“OPBL”). The Complaint alleged that OPBL and various individuals defrauded the market by: (i) misrepresenting how much OPBL’s largest customer, Bank of Montreal (BMO) affected OPBL’s business (ii) misrepresenting the viability of OPEX, OPBL’s natural gas trading platform (iii) misrepresenting the nature of an agreement OPBL had with NYMEX and (iv) failing to disclose the CEO’s alleged old non-securities related convictions, among other allegations. After full briefing, the Court upheld the arguments made by Mr. Gelber and other defense counsel on all points and dismissed the Complaint, in full, as to all defendants. The Court expressly ruled that OPBL had no obligation to disclose the old convictions because (1) Item 401 of Regulation S-B did not require disclosure and (2) such disclosure was not, in any event, necessary “to make other statements not false or misleading”. Plaintiffs failed to meet the judge's deadline to amend the complaint and instead sought discovery, in violation of the PSLRA. On October 20, 2008, Judge Kaplan entered final judgment of dismissal in favor of all Defendants.
SEC Opinion and
No.34-55988), decided June 29, 2007.
Mr. Gelber’s client, the president of a brokerage firm, appealed a decision of the NASD’s National Adjudicatory Council (“NAC”) permanently barring him from the securities industry in all capacities and ordering him vicariously liable for "restitution" in excess of $3.6 million dollars, for his alleged violations of various NASD rules and the anti-fraud provisions of the federal securities laws. After carefully evaluating the arguments of the parties, the SEC found for Mr. Gelber's client. The SEC issued an Order vacating all sanctions, holding that Mr. Gelber’s client could not be liable for Section 10b or Rule 10b-5 violations, that certain of the alleged NASD Rule violations were not chargeable to Mr. Gelber’s client and remanding the case to NASD for re-determination in light of the SEC ruling.
NASD Arbitration No. 02-00641,
decided November 2, 2006.
Case brought by eight former Prudential brokers, part of a group within Pru created to market to high net worth clients, for breach of contract, defamation, tortious interference and fraud. Prudential counterclaimed for unpaid portions of forgivable loans among other things. Six of the eight settled; one defaulted. The remaining broker retained Mr. Gelber in early 2005, just weeks before hearings were to commence.
Prudential sought more than $900,000.00, alleging a loan plus interest, against Mr. Gelber’s client . The Panel not only denied Prudential’s claims, but awarded Mr. Gelber’s client $625,000.00 in compensatory damages and also assessed 100% of the $44,700.00 remaining forum fees solely against Prudential.
LoPresti v. Massachusetss Mutual Life Ins. Co., et al., (2004 NY Slip Op. 51223; Sup. Ct. Kings Co.)
(see also, The Law Report, Vol. 7, No. 5 [Jan. 2005]).
This case was a New York Donnelly Act (state antitrust) action against multiple parties, including Mr. Gelber's securities brokerage firm client, over 12b-1 fees on 403(b) plans (an insurance product) sold to certain hospital employees. Mr. Gelber, in conjunction with the other defendants, prevailed on a motion to dismiss.
v. Hewitt, 4 Misc.3d 1001(A) (N.Y. City Civ.
Ct. Kings Co. 2004);
Mr. Gelber successfully defended an architect at trial, defeating various
contract / professional negligence claims.
NASD Arbitration No.
03-07013, decided 2005.
An investor seeking six figure damages from losses sustained in four municipal bond purchases brought this case against Mr. Gelber’s clients, a brokerage firm and the president of the firm personally. The claimant alleged securities fraud, common law fraud, negligence and breach of fiduciary duty. Mr. Gelber defended the claim at a full evidentiary arbitral hearing in 2005. The 2005 decision denied the claims in their entirety, awarding claimant zero.
et al. v. Muse
Technologies, Inc., et al., 2002
U.S. Dist. LEXIS 18466; Fed. Sec. L. Rep.
(CCH) ¶92,004 (D.Mass August 27, 2002)
In defending this federal securities fraud class action suit against a public
company and its officers, Mr. Gelber, representing the company and two
officers, succeeded in effectuating a global settlement, after mediation, of
only 12% of the liability policy, a victory for the defense.
NASD Arbitration No. 01-00732,
decided May 24, 2002.
Mr. Gelber represented an individual investor claiming against a brokerage firm and four individuals alleging unauthorized trading, excessive mark-ups and unauthorized use of margin, among other things. Respondents argued that Mr. Gelber’s client ratified the transactions and assumed all the risks of trading. The case was particularly hard fought, with respondents making multiple motions, including a motion to dismiss. There were 18 hearing sessions. The Panel awarded Mr. Gelber’s client a six figure compensatory damage recovery and also awarded $25,000.00 in punitive damages and assessed all of the forum fees against Respondents.
Diller et ano. v. Steurken et al. 712 N.Y.S.2d
311 (Sup. Ct. N.Y. Co. 2000)
In this publicly reported cyber-squatting case, Mr. Gelber's clients
to voluntarily return the plaintiff's "name", but plaintiff,
represented by a premier
New York law firm, sought substantial attorneys' fees. Mr. Gelber defeated that effort on motion.
Advest, Inc. v. Wachtel, et al. 235 Conn., 559, 668 A.D.2d 367 (1995);
Manasse v. Prudential-Bache Securities, Sec. Reg. L. Rep (BNA) Vol. 27, p.1295 (W.D. Pa. 7/20/95);
International Customs Associates, Inc. v. Ford Motor Company, 893 F. Supp. 1251 (S.D.N.Y. 1995);
Dean Witter Reynold’s, Inc. v. Prouse831 F. Supp. 328 (S.D.N.Y. 1993);
Duke v. Touche Ross & Co., 765 F. Supp. 69 (S.D.N.Y. 1991);
Treacy v. Simmons, Fed. Sec. L. Rep. ¶95,920 at 99,567 (S.D.N.Y. 1991);
Farr v. Shearson Lehman Hutton, Inc., 755 F. Supp. 1219 (S.D.N.Y 1991);
Perez-Rubio v. Wyckoff, 718 F. Supp. 217 (S.D.N.Y 1989);
Bernstein v. IDT Corp., 638 F. Supp. 916 (S.D.N.Y 1986);
Bank of Minneapolis v. Fox &
Co., 102 F.R.D. 507
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