What happens if a party fails to comply with a securities arbitration award?
If a party fails to comply with a securities arbitration award in Texas, they could be subject to contempt of court proceedings. This could result in fines, jail time, or both. In addition, the court may also enter a judgment against the non-complying party and order payment of actual damages, attorney’s fees, and court costs. The sanction should be designed to ensure compliance with the award and not to punish the non-complying party. The court may also require the non-complying party to post a bond equal to the amount of the award, which would be held until compliance is achieved. The court may also require the non-complying party to provide an accounting of the funds collected or disbursed related to any award. The court may also order that its decision on non-compliance be published in any paper or journal of general circulation in Texas. Finally, if the non-complying party is a brokerage firm, the court may require the firm to reimburse its clients for their legal fees. The court may also impose a civil penalty on the non-complying party for failing to comply with the arbitration award. In addition, the court can also refer the matter to the securities commission or other state agencies for review.
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