The Guiliano Law Group is pleased to announce that the United States District Court for the Northern District of Georgia entered a judgment and confirmed a $1.9 million arbitration award rendered against the president and owner of a Connecticut based securities broker-dealer and one of its former agents. Malone et al v. Stoyeck et al., (February 14, 2023).
On September 10, 2019, the injured investors filed an arbitration action before the Financial Industry Regulatory Authority (“FINRA”) Office of Dispute Resolution, Arbitration No. 18-04008, Titus Rockefeller, L.L.C, also known as TRC Capital Group, Richard C. Stoyeck and Andre V. Labarbera alleging the violation of the anti-fraud provisions of the federal securities laws, churning or excessive activity, unauthorized trading, the fraudulent extension of margin credit, breach of fiduciary duty, common law fraud, and the violation of the Georgia Uniform Securities Act of 2008.
Mr. Stoyeck was formerly associated with Newport Coast Securities, Inc., which was expelled by FINRA for the failure to pay a customer initiated arbitration award, and as of even date, Mr. Stoyeck has been the subject of three regulatory actions, and has also been a party to at least three disclosed customer initiated, investment related complaints or arbitration claims. Since 1985, Mr. Stoyeck has been associated with twelve broker-dealers, nine of which have been expelled by securities regulators or are otherwise defunct.
Since 1992, Labarbera has been associated with eleven broker-dealers, nine of which have been expelled from FINRA for the violation of the federal securities laws, or are otherwise defunct. Labarbera has also been the subject of at least four customer initiated, investment related complaints or arbitration claims collectively seeking damages in excess of $1 million. In March 2018, Labarbera was barred by the State of Florida, based upon the finding that he engaged in “unsuitable customer transactions, churned customer accounts, traded customer accounts on margin without margin agreements, and engaged in fraudulent transactions.” State of Florida, Office of Financial Regulation, Administrative Proceeding No. 71607-S (March 26, 2018). On May 23, 2018, Labarbera was permanently barred by FINRA, for substantially the same course of conduct effected with many of his customers.
In fact, Labarbera was found to have “excessively traded and churned customer accounts” through “extraordinary amounts of in-and-out trading” in “highly margined” accounts, charging “excessive commissions in the form of mark-ups” which “generally exceeded $1,000 per trade, executed on a riskless principal basis,” in “willful violat[ion] of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, FINRA Rules 2010 and 2020, and NASD Rules 2110 and 2120.” FINRA Enforcement Action No. 2012030564701 (Decision May 23, 2018).
The investors alleged and submitted evidence that during the period they maintained their accounts at TR Capital, approximately 2,040 transactions were effect in their accounts, totaling more than $87,206,000, or at the average rate of approximately $1,400,000 per month. They were charged more than $500,000 in commissions and fees and suffered losses of $1,430,206.
On May 10, 2021 through May 13, 2021, a final evidentiary hearing was held by FINRA, and on May 27, 2021, an Award was entered unanimously by the Panel for compensatory damages, interest at the rate of 7.00% per annum, punitive damages, attorneys’ fees and costs totaling $1,958,711.
The investors sought to confirm the Award. However, the Respondents, Richard C. Stoyeck and Andre V. Labarbera sought to vacate the Arbitration Award based upon the claim that the FINRA Panel failed to follow its own rules about ranking and striking arbitrators and/or denied Respondents the opportunity to do so; conducted the arbitration unfairly by proceeding on Zoom, and that the Panel ruled on pre-hearing discovery motions.
Respondents also argued that “the Claimant’s Award cannot be confirmed because it was it is the result of impermissible bias, corruption, and fraud” and that “[t]he Award was the result of the arbitrator’s partiality to the arbitration Claimants and their counsel, and hostility and contempt for Respondents.”
However, in a 15 page opinion, the Court struck down Respondents’ arguments, and entered a final award for the aggrieved investors for compensatory damages, interest at the rate of 7.00% per annum, punitive damages, attorneys’ fees and costs totaling $1,958,711.
The Guiliano Law Group, P.C. is a “boutique” law firm that has over thirty years experience representing investors in a wide variety of securities and investment related matters in state and federal court, and in arbitration before the Financial Industry Regulatory Authority or FINRA. We were founded, and are headquartered in Philadelphia, Pennsylvania, and we also have offices in Los Angeles, California and Aventura, Florida.
Our practice is multi-jurisdictional or national, where permitted by law, and is substantially limited to the representation of investors in claims against securities broker-dealers, and/or their registered representatives or stockbrokers, for for fraud, negligence, the sale of unsuitable investments, stockbroker theft, breach of fiduciary duty, the failure to supervise and other forms of actionable misconduct.
We have represented more than 1,000 public customers in securities arbitrations both internationally and nationally in almost all 50 states.
We represent clients on a “contingent fee” basis meaning that there is no cost or obligation on the part of the client to pay our legal fees unless we are able to obtain a recovery for you.
If you believe that you have been the victim of misconduct or fraud, contact us for a free consultation.
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