Simplified Arbitration in a Nutshell

By Geoff Hafer, Spring 2016 Student Intern

In this five part series, I will be discussing Simplified Arbitration under FINRA Rule 12800. We will look at the potential benefits of Simplified Arbitration, some of the drawbacks of Simplified Arbitration, how discovery differs in Simplified Arbitration, and finally who are the arbitrators and how are they appointed in Simplified Arbitration.

So first off, what is Simplified Arbitration?

Simplified Arbitration is governed by FINRA Rule 12800 which allows customers to pursue a claim in which the amount in dispute is $50,000.00 or less, exclusive of interest and expenses. Simplified arbitration cases are also called “paper” or “small claims” cases. Unlike typical FINRA arbitrations, which are heard by a panel of three arbitrators at a final evidentiary hearing, Simplified Arbitrations are decided on the papers. This means that the arbitrator decides the case and renders an award based strictly on the Statement of Claim, Answer, and evidentiary submissions. No hearing will be held in Simplified Arbitrations unless the claimant requests one.

Well, who gets to decide whether a claim will be Simplified or not?

It is the claimant who has the ultimate decision on whether to file a Simplified claim. Whether to do so or not involves consideration of not only the total amount of the loss but also other factors a claimant should consider. For instance, if the claimant would prefer not to testify in person or has other obligations that prevent them from doing so, Simplified Arbitration may be the way to go.

And so there is Simplified Arbitration in a nutshell. In part two of the series, we will discuss the potential benefits of Simplified Arbitration.

1 thought on “Simplified Arbitration in a Nutshell

  1. I would like to attend if is possible
    I will be an LLM student starting fall 2016.
    Please let me know …If so please send me dates and time and I will be there .

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