Securities Law Prof Blog

Editor: Eric C. Chaffee
Univ. of Toledo College of Law

Wednesday, February 16, 2011

FINRA Proposes Time Period to Reply to Responses to Motions in Arbitration

FINRA proposes to amend its arbitration rules to provide moving parties with a five-day period to reply to responses to motions.  Currently the rules do not expressly provide the party that made the original motion (the “moving party”) an opportunity to reply to a response. FINRA’s practice has been to forward the reply to the arbitrators, even when staff already have sent the motion and response to the arbitrators. There have been instances where arbitrators reviewed the motion papers and even ruled on a motion before receiving a reply. 

The proposed amendments would codify FINRA’s practice relating to replies to responses to motions and make it transparent. FINRA believes that the proposal would provide parties with an opportunity to brief fully the issues in dispute and ensure that arbitrators have all of the motion papers before issuing a final decision on the motion.  Unfortunately, it may also encourage the filing of more replies and contribute to the trend of increase motion practice in securities arbitration.

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