Ethics Archives - Ken Strongman, Esq.

The Role of the Arbitrator: Duty to Disclose

Arbritration, Ethics Comments Off

Feb 052013

There is a duty to disclose everything.

Role of the Arbitrator: duty to disclose

Arbitrators must be impartial in both appearance and in fact. Therefore, they have a duty to disclose. Arbitrators submit detailed biographical information at the time they join FINRA’s arbitrator roster. The information collected from the application is compiled to create an Arbitrator Disclosure Report (Disclosure Report). During the arbitrator selection process, the individual parties are given the opportunity to review the Disclosure Report of each proposed arbitrator.

The Disclosure Report lists previous FINRA awards rendered by the arbitrator, and also lists the current cases to which the arbitrator is assigned.

To ensure that the arbitrators’ Disclosure Reports are accurate and up-to-date, FINRA sends the arbitrators their Disclosure Report each time the arbitrator is appointed to a case. Arbitrators will update the report at that time. The arbitrator’s duty to disclose is continuous and imperative. Disclosure includes any relationship, experience and background information that may affect—or even appear to affect—the arbitrator’s ability to be impartial and the parties’ belief that the arbitrator will be able to render a fair decision.

When making disclosures, arbitrators consider all aspects of their professional and personal lives and disclose all ties between the arbitrator, the parties and the matter in dispute, no matter how remote they may seem. If there is a question about whether to make a disclosure then they are required to make it.

FINRA requires arbitrators to disclose any direct or indirect financial or personal interest in the outcome of the arbitration, as well as any existing or past, direct or indirect, financial, business, professional, family, social or other relationships with any of the parties, representatives, witnesses or co-panelists.

Arbitrators are also required to continually make reasonable efforts to inform themselves of relationships and interests including changes in their or their immediate family member’s employment, job functions or clients.

About the Author: Ken Strongman (www.kpstrongman.com) has years of experience and a growing national reputation as a mediator and arbitrator. He has successfully resolved more than a thousand disputes in the fields of construction defects, real estate, intellectual property, and employment. He is also a Mediator and Arbitrator for FINRA.

Ethical Obligations Regarding Information Security

Arbritration, Ethics Comments Off

Jan 082013

Focus on security of Information

Ethical Obligations Regarding Information Security

To provide security for participants, documents and information in an arbitration case file are confidential. Arbitrators have an ethical duty to keep confidential all information obtained in connection with an arbitration or mediation. Information that needs to be protected includes, but is not limited to:

Social Security numbers;
Individual taxpayer identification numbers;
Driver’s license numbers;
Party and arbitrator addresses;
Brokerage, bank or other financial account numbers;
Criminal history information;
Fingerprint cards;
Expunged records;
Attorney-client communications; and
Medical records.

Arbitrators must exercise caution when using, transporting, storing and ultimately disposing of case materials. These actions must be handled in a manner that preserves the confidentiality of the information.

Ethical Reasons Not to Accept Appointment as an Arbitrator

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Dec 042012

Ethical reasons to not accept

Ethical Reasons Not to Accept Appointment as an Arbitrator

There are ethical reasons not to accept appointment as an Arbitrator It is important to know when to say no. If an arbitrator has any doubt about whether they can be fair or impartial, the arbitrator should decline the appointment. For example, an arbitrator should refuse an appointment if the arbitrator has firmly held beliefs about the issue in dispute or about a named party to the dispute.

A major goal of arbitration is the prompt resolution of disputes. Thus, in accordance with Canon I (b)(4) of the Code of Ethics, an arbitrator should accept appointment only if fully satisfied: “that [they] can be available to commence the arbitration in accordance with the requirements of the proceeding and thereafter to devote the time and attention to its completion that the parties are reasonably entitled to expect.”

Arbitrator’s Duty to Avoid Potential Conflicts

Arbritration, Ethics Comments Off

Nov 062012

There needs to be an absolute appearance of being impartial.

avoid conflicts

Arbitrator’s Duty to Avoid Potential Conflicts

Upon accepting an appointment, arbitrators should always avoid entering into any financial, business or other relationship that is likely to affect impartiality or might reasonably create an appearance of partiality or bias. For example, an arbitrator should not accept any engagement involving a party while an arbitration case is pending, nor do so for a reasonable period of time after the case concludes. Likewise, arbitrators should disclose previous cases for which they were retained that involved any party, counsel or witness in the current case.

Arbitrator’s Duty to Neutrality

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Oct 092012

Duty to be impartial and neutral.

Arbitrator’s Duty to Neutrality

It is the Arbitrator’s duty to be impartial and neutral throughout a proceeding. Impartiality extends to parties, counsel, agents, witnesses, co-panelists and even the type of case involved. Arbitrators must be impartial in both appearance and in fact. Arbitrators are viewed by parties in an arbitration case much as a judge would be viewed in a court of law. In some ways, arbitrators have greater power than a judge for example except for limited reasons; arbitration awards generally cannot be appealed. Therefore, it is particularly important in arbitration that the forum be fair and be perceived to be fair.

The Arbitrator’s Role: Ethical Considerations

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Sep 112012

The Arbitrator’s Role: Ethical Considerations

FINRA encourages arbitrators to periodically review the Code of Ethics for Arbitrators in Commercial Disputes (Code of Ethics) to refresh themselves about their duties and ethical responsibilities. The information contained in this guide is a brief reminder of the arbitrators’ ethical duties. The guide is neither an exhaustive list nor a substitute for the Code of Ethics or the FINRA Codes. Besides the Code of Ethics, arbitrators should also be mindful of any ethical considerations associated with their respective professions.

Lawyers Behaving Badly: The case of the Stinky Bentleys and Manure Evidence

Ethics Comments Off

Aug 282012

Lawyers Behaving Badly: The case of the Stinky Bentleys and Manure Evidence

Lawyers Behaving Badly: The case of the Stinky Bentleys and Manure EvidenceMy colleague, Matthew Talbot, wrote about a recent presentation of mine at the Inns of Court. Access his compete article HERE.

Here are some highlights of his article:

Nothing interests a group of attorneys and judges more than anecdotes of lawyers and judges behaving badly. At the Robert G. McGrath Inns of Court meeting at the Lafayette Park Hotel, Judge Weil’s group (consisting of Sean McTigue, Nicholas Jay, Samantha Sepehr, Robin Pearson, Ken Strongman, Laureen Bethards, Jay Chafetz, David W. Ginn, and David Pastor) presented a program entitled “Lawyers Behaving Badly”. They identified unethical and inappropriate activities by attorneys and judges. Judge Weil’s group took the Inns membership down the yellow brick road of litigation to the Emerald City of just plain bad lawyering.

Using a variety of vignettes, they illustrated instances when lawyers (and even judges) didn’t exactly meet the standards of our fine profession.

In one vignette, Judge Weil’s group told the story of the “Stinky Bentleys.” Here, the Bentley Car Company had sold cars with obnoxious odors, and despite receiving complaints, did not take appropriate steps to remedy this problem. Instead of following the tried and true method advocated on Seinfeld of dealing with smelly cars (i.e. abandoning them on the streets of NYC), the owners sued Bentley. Bentley, in return, followed poor legal advice and abandoned any responsibility to perform discovery. They failed to turn over documents, lied under oath, destroyed evidence despite court order, and generally stymied attempts at discovery. The Court considered this “lawyers behaving badly.” The Inns meeting had a lively discussion regarding whether terminating sanctions for Bentley’s defense were appropriate.

There was another vignette that related to Seinfeld as it had an element near and dear to George Constanza’s heart: manure. “It’s like Ma and Newer!” (George, 3. episode: The Cadillac – Part 2). In this case, the defendant was avoiding following any discovery rules at all. He was a rebel who played by nobody’s rules! When it came time for a document request at a deposition, he showed up to the deposition with those documents … covered in manure. Unfortunately for the people at the deposition, the ‘manure’ episode of Seinfeld wouldn’t air for another 13 years and so there was little mirth to be had in this production of documents. The Inns meeting again discussed whether terminating sanctions were appropriate.

All in all, it was an interesting discussion regarding the unethical steps a few amongst us are willing to take. This small group of unethical lawyers, by their obstreperous and unprofessional acts, gives the large majority of professional, skilled and ethical attorneys a bad name, and sometimes sleepless nights. While most attorneys are just trying to do their best to zealously represent their clients, there are some attorneys out there sadly making the published decisions or even the news; they shirk all responsibility to their clients, other attorneys, and society as a whole. May none of us ever find ourselves the subject of a similar Inns discussion!