Group of Investors and Real Estate Limited Partnership (LP) Investments
N/A
OUTCOME: Confidential Settlement
We represented a group of 16 clients, all of whom had purchased investments in one of two private limited partnership real estate transactions. The total losses were more than $1.7 million. We filed th...e case in Circuit Court in Portland, Oregon. We sued the real estate developer who ran the partnerships, and the New York law firm that prepared the confidential private placement memoranda that were used to sell the investments. After more than 15 depositions and countless motions filed against our case, we ultimately settled the case for an amount that our clients agreed to accept and that the defendants require us to keep as confidential. Years after the end of that case, we still receive emails from those clients thanking us for our efforts.
Securities and investment fraud
Elderly Client and Overconcentration in Energy Sector Equities
N/A
OUTCOME: Confidential Settlement
The broker in this case seemed to treat all of his clients the same, regardless of age, investment objectives, or individual risk tolerance. We represented a large group of investors with similar over...concentration of energy sector equities in their accounts and filed claims on their behalf against the broker, but one investor in particular stood out as a particularly egregious case. Our 90+ year old client entrusted her life savings with the broker, who put her into 99.9% stocks that were heavily concentrated in risky energy sector investments. Her account had six-figure losses in a short amount of time. We quickly reached a confidential settlement with the broker and his firm for nearly all of what our FINRA complaint asked for – a huge victory for our client who otherwise would have lost most of her retirement savings.
Securities and investment fraud
Family of Investors Harmed by Broker "Churning" Accounts
N/A
OUTCOME: FINRA award of nearly 100% of excessive fees awarded back to investors, plus statutory interest, costs, attorney fees
We represented a family, including an elderly couple in their 80’s, that trusted their retirement savings with a local broker and his solo brokerage firm. The broker engaged in frequent buying and sel...ling of individual stocks in the accounts, which earned him a hundreds of thousands of dollars in commissions but otherwise did not benefit (and actually harmed) the performance of the accounts. The cost/equity ratio of the accounts was as high as 17.5%, which means that the account had to realize trading profits of 17.5% just to avoid losing money. The broker had been charging commissions hundreds of thousands of dollars higher than if he had charged a flat 2% management fee of the accounts.
After a four-day arbitration hearing, the FINRA arbitration panel found unanimously that the broker’s frequent trading of securities in the accounts were excessive in light of the investment objectives and risk tolerance of the various family accounts, and his investment strategy of aggressive trading in individual stocks was unsuitable. The panel awarded our clients nearly 100% of the excessive fees that we had requested be returned to them, and also awarded them interest, costs, expert witness fees, and our attorney fees. The broker tried to vacate the arbitration award, and we won before the Oregon trial court that the award should not be vacated. The broker then appealed that decision to the Oregon Court of Appeals. We again argued for our clients that the award should stand, and the Court of Appeals agreed in 2018 and affirmed the lower court’s decision.
Securities and investment fraud
Portfolio Mismanagement - Lack of Diversification and Asset Allocation
N/A
OUTCOME: Confidential Settlement
We represented a client regarding investments purchased for her revocable trust’s investment account at a major national brokerage firm. Our client relied on her financial advisor’s recommendations and... trusted that he would be monitoring her account and make suitable recommendations for her retirement needs. After recovering from a serious health issue, our client discovered that her advisor used his discretionary trading authority to reduce her revocable trust’s account to just a handful of single equity stocks, heavily concentrated in the energy sector. In just a short period of time her account lost nearly $200,000 due to the risky lack of diversification. We filed a FINRA case on her behalf claiming breach of fiduciary duty, negligence, failure to supervise, and violation of the Oregon Securities Laws for the mismanagement of the account. We negotiated a confidential settlement for our client, and she was able to recover a significant amount of her retirement savings and move on with her life.
