Breiman v. Round Hill Securities, Inc. et. al. ⇒ $1.44 million

The Law Offices of Cary S. Lapidus obtained an arbitration award of $1.44 million on behalf of clients who alleged fraud, breach of fiduciary duty and misrepresentations in connection with their securities portfolio.

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“Cary Lapidus is probably the most well prepared attorney with whom I have ever dealt. He has excellent judgment and understanding of the law. Most important of all, he is highly ethical and those who deal with him know that his word is his bond.“
Paul Dubow
Opposing Counsel & Mediator in Six Cases


In The News

J.P. MORGAN TO PAY $350,000 IN DEFAMATION CLAIM
Diana Britton
Wealth Management
November 09, 2015



Last week an arbitration panel ordered J.P. Morgan Securities to pay $350,000 in compensatory damages, plus interest, to Kostantina Bourdev, a former advisor who claimed she was wrongfully terminated and defamed in September 2013 when the firm fired her for, they claimed, falsely characterizing the risks and returns of a handful of fixed-income funds, including an absolute return fund.

Finding against a wirehouse firm in a FINRA arbitration proceeding is rare. “It sends message to firms like JP Morgan and others that they better conduct a full and fair investigation before they terminate someone and place a black mark on their U5,” said Cary Lapidus, Bourdev’s attorney in San Francisco. “If they don’t, then they could be liable for hundreds of thousands of dollars in damages.”

Representatives of J.P. Morgan declined to comment.

According to the award, J.P. Morgan was investigating another advisor at the firm, who they claim misrepresented the risks and guaranteed returns of certain investments in client presentations. The arbitration does not name the other advisor, who was also terminated.

Bourdev would often make joint presentations with this advisor, but she would speak on the firm’s banking products, said Lapidus. J.P. Morgan terminated Bourdev, claiming she attended these client meetings where the alleged misrepresentations were made and that she failed to report them to supervisors. The firm changed her U-5 to say that she had participated in those meetings.

“My client said she never heard any misrepresentation made, so the statement that she participated in meetings in which misrepresentations were made was just plain false,” Lapidus said.

The arbitration panel ordered the termination explanation on Bourdev’s Form U-5 be expunged. It will be replaced with, “A FINRA arbitration panel found no violations of investment-related statutes, regulations, rules or industry standards of conduct on the part of registered rep Kostantina Bourdev. The FINRA arbitration panel found that J.P. Morgan Securities, LLC conducted a deficient investigation concerning Ms. Bourdev relating to her termination.”

But the damage to Bourdev’s career has been done, said Lapidus. She had worked her way up at J.P. Morgan for eight years to become a private banker. When she was terminated, she applied to 20 firms, none of which hired her. Ameriprise brought her on as a registered operations leader, making half the salary she was at J.P. Morgan. And because Ameriprise doesn’t have a private banking business, she wasn’t able to bring over any clients. She currently works for Ameriprise in Redwood City, Calif.

“It’s affected her entire future,” Lapidus said.

This type and size of award against a brokerage firm is rare in the industry.

“It’s sort of a David versus Goliath situation,” Lapidus said. “It’s just one lone individual against that firm, so you don’t see a lot of these awards.”



Please contact us for assistance with securities arbitration law, securities litigation, broker misconduct, investment advisor misconduct and investment losses.

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