Search

How would a court resolve a broker-dealer's action to enforce its class action waiver, which would require the court to disregard FINRA Rule 13204? The Supreme Court has identified one exception to the FAA's mandate: if a “contrary congressional command” displaces the FAA. Thus far, the Court has not had occasion to examine whether a class action waiver in a broker-dealer's employment agreement with an employee is enforceable under this exception. While the Court seems very supportive of these waivers, the securities industry is different. Securities arbitration is heavily regulated, and pronouncements by the SEC--when exercising power expressly delegated to it by Congress--make it clear that class actions in court should be preserved for both investors and broker-dealer employees. This article analyzes this issue and concludes that these class waivers are not enforceable. Part II details the regulatory framework in the securities industry relevant to this issue. Part III explains why FINRA, as a forum, does not accept class actions and why the SEC believes court-filed class actions should be preserved for employees of broker-dealers. Part IV describes the framework the Supreme Court directs courts to use when analyzing alleged conflicts between two Congressional Acts. Part V argues that FINRA's Rule 13204 barring FINRA member firms from forcing employees to waive their right to pursue class action claims in court conflicts with and supersedes the FAA's general pronouncement to enforce arbitration agreements as written. Part VI concludes.

[Abstract] This paper is an introduction to the U.S. class action lawsuits under the Rule 23 of the Federal Rules of Civil Procedure. Class actions lawsuits have been an integral part of the U.S. judicial system for many decades. This paper outlines both the benefits of this remedy and the main criticisms of it. It pays special attention to pre-default, contractual mandatory arbitration clauses and the validity of class action waivers. All this is viewed from a practical perspective based on real cases that illustrate the actual trends of the American Courts of Justice. Finally, it includes a brief analysis of the Spanish class actions to provide the reader with a general overview of this procedural device both under US and EU law perspective., [Resumen] El presente artículo es una introducción a las demandas colectivas de los EE. UU. bajo la Regla 23 de las Reglas Federales de Procedimiento Civil. Las demandas colectivas han sido una parte integral del sistema judicial de los EE. UU. durante décadas. Este artículo describe tanto los beneficios de este recurso como las principales críticas al mismo. Se presta especial atención a las cláusulas de arbitraje preceptivo preestablecidas y a la validez de las renuncias a ejercitar demandas colectivas. Todo ello es analizado desde una perspectiva práctica basada en casos reales que ilustran las tendencias reales de los Tribunales de Justicia estadounidenses. Finalmente, incluye un breve análisis de las demandas colectivas en España para proporcionar al lector una visión general de este recurso procesal, tanto bajo la perspectiva de la legislación de los Estados Unidos como de la UE