Selected Expert Witness Matters

A Boston matter involved an elderly widow who lost approximately $90,000 through unsuitable stock trading at a local brokerage house. Damages were formulated in a manner that assisted settlement and approximated the out-of-pocket loss.

Additional suitability matters have involved middle-aged to elderly clients, including clients with cognitive or other impairments. Some matters involved short selling and margin borrowing.

An unauthorized trading matter in Maine involved a brain-damaged woman whose trustee relatives arranged for personal injury settlement funds to be placed in a brokerage account where subsequent unsuitable trading lost almost all of the funds.

A Midwestern couple matter involved alleged unauthorized and unsuitable stock-portfolio trading, including short selling and heavy margin borrowing by a broker who also served as a branch office manager. Control-person issues and internal compliance expectations were important aspects of the matter.

A futures and interbank currency matter involved analysis connected with one of the largest positions ever established on a futures exchange and in the interbank currency market. The matter addressed duties and standards applicable to a broker who did not have discretion over a customer account.

MCC worked with the Federal Bureau of Investigation and the United States Attorney in Boston on a major financial-industry fraud case involving churning in futures, securities, and options. The matter resulted in a criminal conviction related to looting an investment pool through excessive trading.

A matter for a major California brokerage firm involved defense against allegations of churning and inadequate risk disclosure in connection with a day-trading program involving long and short selling. The analysis addressed trading strategy, sophistication, risk disclosure, track record, and alleged guarantees.

A Nevada suitability matter involved defense of a broker against a customer claim, including analysis of duties where the client had considerable wealth and a preference for higher-risk stock investments.

A government enforcement action against a Florida firm involved alleged excessive charges in trading accounts, where cost levels were analyzed against prevailing industry practices.

A trust-administration matter involved administration of a trust over a 65-year period by a prominent regional bank in the mid-South. Issues included whether the bank met duties under the prudent person rule as it evolved over time.

Representative matters have involved FINRA and other arbitration forums, mediation, state and federal court, government enforcement actions, and U.S. Tax Court. Subject areas include suitability, unauthorized trading, churning, supervision, fiduciary duty, damages, trust management, futures, derivatives, portfolio management, and financial-industry standards.