What types of damages can be awarded in a securities arbitration case?

In a securities arbitration case, damages may be awarded to compensate investors for losses that were caused by a broker or investment firm’s misconduct. Damages in a securities arbitration case may take the form of compensatory damages, or damages that are designed to make the investor “whole” again. These damages may consist of amounts to cover costs associated with the investment, such as commissions and fees, as well as the losses that resulted from the broker’s or firm’s wrongful conduct. Additionally, punitive damages may also be awarded in a securities arbitration case. Punitive damages are intended to punish the broker or firm for its misconduct and deter similar misconduct in the future. Receiving punitive damages is more rare than receiving compensatory damages, and the arbitration panel has discretion when deciding whether to award punitive damages. Under the California Securities Law, the arbitration panel may also award attorney’s fees and costs in cases where the investor is victorious. These fees and costs can be very costly and investors should be aware that they are generally responsible for paying their own legal expenses. Additionally, depending on the circumstances, the arbitration panel may also award interest on the compensatory damages awarded to the investor. Interest will usually be calculated based on the investment’s rate of return or the average prime rate of interest. In some cases, the arbitration panel may also award other forms of relief, such as an injunction or rescission, which means unwinding the transaction or making it void. These types of relief are less common than damages, but can still be awarded by the panel when it is deemed appropriate.

What types of damages can be awarded in a securities arbitration case?

Related FAQs

Related Blog Posts