Preview
FILED
DALLAS COUNTY
8/11/2016 1:38:52 PM
FELICIA PITRE
DISTRICT CLERK
DC-16-09763 Freeney Anita
NO.
FIDELITY BROKERAGE SERVICES LLC, § IN THE DISTRICT COURT OF
SEAN PHILLIP OITTINEN; AND §
STEPHEN A. FOX, §
§
Plaintiffs, §
§
v. § DALLAS COUNTY, TEXAS
§
JOSEPH SANBERG, §
§ I-162ND
Defendant. § _________ JUDICIAL DISTRICT
§
APPLICATION TO CONFIRM ARBITRATION AWARD
Plaintiffs Fidelity Brokerage Services LLC (“Fidelity”), Sean Phillip Oittinen and
Stephen A. Fox (collectively “Plaintiffs”) apply to this Court to confirm an arbitration award
pursuant to Section 171.087 of the Texas Civil Practice and Remedies Code (the “Application”).
In support of their Application, Plaintiffs respectfully show the following:
I. Discovery Level
1. Plaintiffs do not anticipate conducting any discovery. However, should any discovery
occur, it should be conducted under Level 2 pursuant to Rule 190.3 of the Texas Rules of Civil
Procedure.
II. Parties
2. Plaintiff Fidelity is a licensed and incorporated broker/dealer with offices in Dallas
County, Texas.
3. Plaintiff Oittinen is an individual who resides in Denton County, Texas, and is an
employee of Fidelity.
4. Plaintiff Fox is an individual who resides in Salt Lake County, Utah, and is a former
employee of Fidelity.
42327955.1/11404718 -1-
5. Defendant Joseph Sanberg (“Defendant”) is an individual who resides California.
Defendant has agreed to accept service via e-mail and does not oppose this application.1
III. Jurisdiction and Venue
6. Plaintiffs bring this Application pursuant to Chapter 171 of the Texas Civil Practice and
Remedies Code. Jurisdiction and venue are proper because a part of the underlying actions in
the arbitration occurred in Texas and Defendant has agreed to allow Plaintiffs to confirm the
expungement award in Texas.
IV. Background Facts
7. Defendant initiated an arbitration with the Financial Industry Regulatory Authority
(“FINRA”) by filing a Statement of Claim (“SOC”) on or about September 27, 2013, alleging,
among other things, that Mr. Oittinen and Mr. Fox made material misrepresentations and
omissions to him related to his margin account and that Fidelity conducted an unauthorized
liquidation of 85,000 shares of Defendant’s Facebook Inc. stock in his margin account.
8. On or about November 26, 2013, Plaintiffs filed an Answer to the Statement of Claim
denying the allegations made (“Answer”).
9. On or about March 6, 2015, the parties entered into a binding settlement agreement
whereby Defendant agreed to dismiss all of his claims with prejudice against the Plaintiffs.
10. On or about April 28, 2015, Plaintiffs filed a request for expungement of all references to
Defendant’s claims from Mr. Oittinen’s and Mr. Fox’s records held with FINRA’s Central
Registration Depository (“CRD”). Mr. Oittinen’s CRD number is 5076825 and Mr. Fox’s CRD
number is 5036856.
11. On May 18, 2016, the Arbitrators held an evidentiary hearing on Plaintiffs’ Request for
Expungement.
1
See August 1 and July 8, 2016 correspondence, a true and correct copy of which is attached hereto as Exhibit A.
-2-
12. On or about May 27, 2016, the Arbitrators issued an Award (the “Award”) dated May 26,
2016 in which the Arbitrators determined:
The Panel recommends the expungement of all references to the above captioned
arbitration from Respondents Stephen A. Fox and Sean Phillip Oittinen’s
registration records maintained by the CRD, with the understanding that pursuant
to Notice to Members 04-16, Respondents Stephen A. Fox and Sean Phillip
Oittinen must obtain confirmation from a court of competent jurisdiction before
the CRD will execute the expungement directive.
Unless specifically waived in writing by FINRA, parties seeking judicial
confirmation of an arbitration award containing expungement relief must name
FINRA as an additional party and serve FINRA with all appropriate documents.
Pursuant to Rule 12805 of the Code of Arbitration Procedure (the “Code”), the
Panel has made the following Rule 2080 affirmative findings of fact:
The claim, allegation, or information is factually impossible or clearly erroneous;
and
The claim, allegation, or information is false.2
13. In making its ruling, the Arbitrators based their findings on Claimant’s Statement of
Claim, Respondents’ Request for Expungement, Respondents’ Request for Expungement,
Exhibit E – Margin Agreement, the evidence presented at the expungement hearing, the
parties’ settlement agreement, and Mr. Fox’s and Mr. Oittinen’s current BrokerCheck
reports.3 Specifically, the Arbitrators found that:
. . . neither Fox nor Oittinen caused or failed to act to prevent the transactions
executed by Claimant or Claimant’s decision to trade on margin. Neither Fox nor
Oittinen could have done anything, nor did they do anything to affect the matter
alleged in the claim. Accordingly, the claim, attestation and information is
factually impossible and clearly erroneous. Fox and Oittinen did nothing wrong in
this matter. Their records should be expunged. The Panel further finds the Second
Circuit opinion in de Kwiatkowski v. Bear Stearns & Co., Inc., 306 F.3d 1293
(2nd Cir. 2002) to be material in this matter.4
2
See Award, a true and correct copy of which is attached hereto as Exhibit B.
3
See id.
4
See id.
-3-
14. FINRA requires that the Award be confirmed by a Court before FINRA will effectuate
the expungement. Therefore, this Application is being filed solely for the purpose of obtaining
confirmation of the Award and a corresponding order of expungement.
15. Although FINRA ordinarily requires that it be named as an additional party in any action
seeking judicial confirmation of an arbitration award containing expungement relief, FINRA has
waived that requirement here pursuant to FINRA Rule 2080.5
V. Conclusion and Prayer
WHEREFORE, PREMISES CONSIDERED, Plaintiffs Fidelity Brokerage Services LLC,
Sean Phillip Oittinen and Stephen A. Fox pray that this Court confirm the Award rendered by the
Arbitrators in FINRA Case No. 13-02835, on or about May 27, 2016, pursuant to Chapter 171 of
the Texas Civil Practice and Remedies Code, and enter judgment that all references to the
arbitration proceeding and claims asserted therein be expunged from Sean Phillip Oittinen’s and
Stephen A. Fox’s registration records maintained with FINRA’s Central Registration Depository.
5
See FINRA Waiver Letter, a true and correct copy of which is attached hereto as Exhibit C.
-4-
Dated: August 11, 2016 Respectfully submitted,
NORTON ROSE FULBRIGHT US LLP
/s/ Ellen Sessions
Ellen Sessions
State Bar No. 00796282
ellen.sessions@nortonrosefulbright.com
Nicholas Hendrix
State Bar No. 24087708
nick.hendrix@nortonrosefulbright.com
2200 Ross Avenue, Suite 3600
Dallas, TX 75201-7932
Telephone: (214) 855-8000
Facsimile: (214) 855-8200
Megan A. Roberts
State Bar No. 24077705
megan.roberts@nortonrosefulbright.com
1301 McKinney, Suite 5100
Houston, TX 77010-3095
Telephone: (713) 651-5480
Facsimile: (713) 651-5246
Attorneys for Plaintiffs
CERTIFICATE OF CONFERENCE
I hereby certify that I have conferred with Defendant regarding the Application on
August 1, 2016. Specifically, I notified Defendant of Plaintiffs’ intent to file an application for
confirmation of the arbitration award granting expungement, and inquired whether Defendant
would oppose the Application. Defendant does not oppose the application.
/s/ Ellen Sessions____
Ellen Sessions
CERTIFICATE OF SERVICE
I hereby certify that a true and correct copy of the foregoing was served via e-mail on
August 11, 2016 addressed to the following:
Jeffrey D. Farrow
Jfarrow@mrllp.com
Todd Stitt
Tstitt@mrllp.com
17901 Von Karman Avenue, 10th Floor
Irvine, CA 92614 /s/ Megan Roberts____
Megan Roberts
-5-
From: "Jeff Farrow (OC)"
Date: August 1, 2016 at 8:07:53 PM CDT
To: "Sessions, Ellen"
Subject: RE: FINRA Rule 2080 Waiver Request Grant Letter
Yes, we will accept service
Sanberg will not oppose the application to confirm the award.
Jeffrey D. Farrow
The link ed image cannot be display ed. The file may hav e been mov ed, renamed, or deleted. Verify that the link points to the correct file and location.
Los Angeles | Orange County | Sacramento | San Francisco | Chicago | New York
17901 Von Karman Avenue, 10th Floor, Irvine, CA 92614
T 714.557.7990 F 714.557.7991
E jfarrow@mrllp.com www.mrllp.com
B io v Card
From: Sessions, Ellen [mailto:ellen.sessions@nortonrosefulbright.com]
Sent: Monday, August 01, 2016 11:51 AM
To: Jeff Farrow (OC)
Cc: Roberts, Megan
Subject: RE: FINRA Rule 2080 Waiver Request Grant Letter
Jeff,
Two more questions:
1. will you accept service of the application to confirm the award by email?
2. does Sanberg oppose or not oppose the application to confirm the award?
Ellen
Ellen Sessions | Partner
Norton Rose Fulbright US LLP
2200 Ross Avenue, Suite 3600, Dallas, Texas 75201-7932, United States
Tel +1 214 855 7465 | Fax +1 214 855 8200
ellen.sessions@nortonrosefulbright.com
NORTON ROSE FULBRIGHT
Law around the world
nortonrosefulbright.com
1
Exhibit A 1
From: Jeff Farrow (OC) [mailto:JFarrow@mrllp.com]
Sent: Friday, July 08, 2016 3:10 PM
To: Sessions, Ellen
Cc: Roberts, Megan
Subject: Re: FINRA Rule 2080 Waiver Request Grant Letter
Hi Ellen. Joe will consent to jx in Texas. Hope you have a nice weekend. Jeff
Jeffrey D. Farrow
The link ed image cannot be display ed. The file may hav e been mov ed, renamed, or deleted. Verify that the link points to the correct file and location.
Los Angeles | Orange County | Sacramento | San Francisco | Chicago | New York
17901 Von Karman Avenue, 10th Floor, Irvine, CA 92614
T 714.557.7990 F 714.557.7991
E jfarrow@mrllp.com www.mrllp.com
B io v Card
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__________
On Jul 8, 2016, at 08:55, Sessions, Ellen wrote:
Jeff,
FINRA grated the waiver so we will be preparing the court filing soon. We will file in California
unless you tell us you all want Texas and will consent to jurisdiction in Texas and service of
process. Please let me know.
Ellen Sessions | Partner
Norton Rose Fulbright US LLP
2200 Ross Avenue, Suite 3600, Dallas, Texas 75201-7932, United States
Tel +1 214 855 7465 | Fax +1 214 855 8200
ellen.sessions@nortonrosefulbright.com
NORTON ROSE FULBRIGHT
Law around the world
nortonrosefulbright.com
From: Weinstein, Karen [mailto:Karen.Weinstein@finra.org]
Sent: Friday, July 08, 2016 9:29 AM
To: Sessions, Ellen
Subject: FINRA Rule 2080 Waiver Request Grant Letter
SEAN OITTINEN, CRD# 5076825
STEPHEN A. FOX, CRD# 5036856
Ellen,
2
2
Attached please find FINRA’s Rule 2080 Waiver Request grant letter for the above-named
individuals. Thanks, Karen
Karen Weinstein
Analyst
Registration and Disclosure
Legal and Policy
240-386-4788
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3
3
Award
FINRA Dispute Resolution
In the Matter of the Arbitration Between:
Claimant Case Number: 13-02835
Joseph Sanberg
vs.
Respondents Hearing Site: Los Angeles, California
Fidelity Brokerage Services, LLC
Stephen A. Fox
Sean Phillip Oittinen
______________________________________________________________________
Nature of the Dispute: Customer vs. Member and Associated Persons
This case was decided by an all-public panel.
REPRESENTATION OF PARTIES
For Claimant Joseph Sanberg, hereinafter referred to as “Claimant”: Todd H. Stitt, Esq.,
Michelman & Robinson, LLP, Irvine, California.
For Respondents Fidelity Brokerage Services, LLC (“Fidelity”), Stephen A. Fox (“Fox”)
and Sean Phillip Oittinen (“Oittinen”), hereinafter collectively referred to as
“Respondents”: Ellen B. Sessions, Esq., Norton Rose Fulbright US LLP, Dallas, Texas.
CASE INFORMATION
Statement of Claim filed on or about: September 27, 2013.
Claimant signed the Submission Agreement: September 27, 2013.
Statement of Answer filed by Respondents on or about: November 26, 2013.
Fidelity signed the Submission Agreement: November 21, 2013.
Fox signed the Submission Agreement: November 26, 2013.
Oittinen signed the Submission Agreement: November 22, 2013.
Exhibit B 4
FINRA Dispute Resolution
Arbitration No. 13-02835
Award Page 2 of 6
CASE SUMMARY
Claimant asserted the following causes of action: failure to treat Claimant in a just and
equitable manner; negligence, gross negligence, negligent misrepresentation and
omission, and negligent failure to supervise; fraudulent misrepresentation, fraudulent
concealment and/or omission and fraudulent inducement and/or promissory fraud;
breach of fiduciary duty; breach of contract and breach of the implied covenant of good
faith and fair dealing; violation of the Securities Exchange Act of 1934 and Securities
Exchange Commission Rules; violation of the Massachusetts Uniform Securities Act;
violation of the Massachusetts Consumer Protection Act; and violation of FINRA
Conduct Rules. The causes of action relate to Claimant’s investment in Facebook.
Unless specifically admitted in their Answer, Respondents denied the allegations made in
the Statement of Claim and asserted various affirmative defenses.
RELIEF REQUESTED
In the Statement of Claim, Claimant requested:
1. Damages based on fairness and equity;
2. Compensatory damages in the amount of $340,000.00;
3. Punitive damages in an amount sufficient to punish a corporation with the net
worth of Fidelity, but in an amount at least equal to three times the $340,000.00 at
issue, or $1,020,000.00;
4. Attorneys’ fees and costs pursuant to Mass. Gen. L. c. 110A § 410(a)(2)(b) and/or
pursuant to Mass. Gen. L. c. 93A §9(2)-(4);
5. Prejudgment interest at a rate of 12% per annum, on all amounts claimed as
allowable by law, pursuant to Mass. Gen. L. c. 231 §§ 6B, 6C; and
6. Such other and additional relief as the Panel may deem just and proper.
In their Statement of Answer, Respondents requested:
1. Dismissal of Claimant’s claims; and
2. Expungement of all references to this matter from the Central Registration
Depository (“CRD”) records of Fox and Oittinen.
OTHER ISSUES CONSIDERED AND DECIDED
On April 6, 2015, Respondents’ counsel advised FINRA Dispute Resolution that the
parties have resolved this matter and requested that FINRA Dispute Resolution keep
the case open as Fox and Oittinen will seek expungement. On April 7, 2015, Claimant’s
counsel notified FINRA Dispute Resolution that all claims are dismissed with prejudice.
On April 28, 2015, Respondents’ counsel submitted a Request for Expungement. No
response to the request was filed.
A previously appointed Panel conducted a recorded in-person hearing on August 4,
2015 so the parties could present oral argument and evidence on Respondents’
Request for Expungement. Claimant’s counsel attended the hearing and did not oppose
the request.
5
FINRA Dispute Resolution
Arbitration No. 13-02835
Award Page 3 of 6
On March 10, 2016, FINRA Dispute Resolution appointed the undersigned replacement
arbitrators (the “Panel”) to this matter in accordance with the parties’ agreement.
On April 11, 2016, Respondents’ counsel resubmitted their Request for Expungement
filed on April 28, 2015. No response to the request was filed.
On May 18, 2016, the Panel listened to the recorded expungement hearing that took
place on August 4, 2015 regarding Respondents’ Request for Expungement.
In recommending expungement, the Panel reviewed and relied upon the following:
• Claimant’s Statement of Claim;
• Respondents’ Request for Expungement;
• Respondent’s Request for Expungement, Exhibit E – Margin Account
Agreement; and
• The recording of the August 4, 2015 expungement hearing.
The Panel reviewed the parties’ settlement agreement and considered the amount of
payments made to any party and other terms and conditions of settlement. The Panel
found that the settlement was not conditioned upon an agreement not to oppose a
request for expungement. The Panel also found that Fox and Oittinen did not contribute
to the settlement. The Panel considered it significant that Fox and Oittinen did not
contribute to the settlement.
The Panel also reviewed Fox and Oittinen’s current BrokerCheck reports.
The Panel has agreed that the Award in this matter may be executed in counterpart
copies or that a handwritten, signed Award may be entered.
The Panel acknowledges that they have each read the pleadings and other materials
filed by the parties.
AWARD
After considering the pleadings, the testimony and evidence presented at the August 4,
2015 hearing, the Panel has decided in full and final resolution of the issues submitted
for determination as follows:
The Panel recommends the expungement of all references to the above-
captioned arbitration from Respondents Stephen A. Fox and Sean Phillip
Oittinen’s registration records maintained by the CRD, with the understanding
that pursuant to Notice to Members 04-16, Respondents Stephen A. Fox and
Sean Phillip Oittinen must obtain confirmation from a court of competent
jurisdiction before the CRD will execute the expungement directive.
Unless specifically waived in writing by FINRA, parties seeking judicial
confirmation of an arbitration award containing expungement relief must name
FINRA as an additional party and serve FINRA with all appropriate documents.
6
FINRA Dispute Resolution
Arbitration No. 13-02835
Award Page 4 of 6
Pursuant to Rule 12805 of the Code of Arbitration Procedure (the “Code”), the
Panel has made the following Rule 2080 affirmative findings of fact:
The claim, allegation, or information is factually impossible or clearly erroneous;
and
The claim, allegation, or information is false.
The Panel has made the above Rule 2080 findings based on the following
reasons:
After reviewing the evidence in this case, the Panel finds that neither Fox nor
Oittinen caused or failed to act to prevent the transactions executed by Claimant or
Claimant’s decision to trade on margin. Neither Fox nor Oittinen could have done
anything, nor did they do anything to affect the matter alleged in the claim.
Accordingly, the claim, attestation and information is factually impossible and
clearly erroneous. Fox and Oittinen did nothing wrong in this matter. Their records
should be expunged. The Panel further finds the Second Circuit opinion in de
Kwiatkowski v. Bear Stearns & Co., Inc., 306 F.3d 1293 (2nd Cir. 2002) to be
material in this matter.
FEES
Pursuant to the Code, the following fees are assessed:
Filing Fees
FINRA Dispute Resolution assessed a filing fee* for each claim:
Initial Claim Filing Fee =$ 1,800.00
*The filing fee is made up of a non-refundable and a refundable portion.
Member Fees
Member fees are assessed to each member firm that is a party in these proceedings or
to the member firm(s) that employed the associated person(s) at the time of the event(s)
giving rise to the dispute. Accordingly, as a party, Fidelity Brokerage Services, LLC is
assessed the following:
Member Surcharge =$ 2,800.00
Pre-Hearing Processing Fee =$ 750.00
Hearing Processing Fee =$ 5,000.00
Adjournment Fees
Adjournments granted during these proceedings for which fees were assessed:
October 14-17, 2014, adjournment by parties =$1,200.00
______________________________________________________________________
Total Adjournment Fees =$1,200.00
1. The Panel has assessed $600.00 of the adjournment fees to Claimant.
7
FINRA Dispute Resolution
Arbitration No. 13-02835
Award Page 5 of 6
2. The Panel has assessed $600.00 of the adjournment fees jointly and severally to
Respondents.
Hearing Session Fees and Assessments
The Panel has assessed hearing session fees for each session conducted. A session is
any meeting between the parties and the arbitrator(s), including a pre-hearing
conference with the arbitrator(s), that lasts four (4) hours or less. Fees associated with
these proceedings are:
Three (3) Pre-hearing sessions with the Panel @ $1,200.00/session =$3,600.00
Pre-hearing conferences: February 11, 2014 1 session
December 3, 2014 1 session
April 7, 2016 1 session
Two (2) Hearing sessions on expungement request @ $1,200.00/session
Hearing Date: August 4, 2015 2 sessions =$2,400.00
Total Hearing Session Fees =$6,000.00
1. The Panel has assessed $1,800.00 of the hearing session fees to Claimant.
2. The Panel has assessed $4,200.00 of the hearing session fees jointly and
severally to Respondents.
All balances are payable to FINRA Dispute Resolution and are due upon receipt.
8
May 27, 2016
9
May 27, 2016
10
May 27, 2016
11
July 8, 2016
Ellen Sessions
Norton Rose Fulbright US LLP
2200 Ross Avenue, Suite 3600
Dallas, TX 75201
Re: SEAN OITTINEN, CRD# 5076825
STEPHEN A. FOX, CRD# 5036856
FINRA Arbitration Case #: 13-02835
Joseph Sanberg vs. Fidelity Brokerage Services, LLC, Stephen A. Fox, Sean
Phillip Oittinen
Dear Ms. Sessions:
FINRA has reviewed, and determined to grant, your request for a waiver of the obligation
under FINRA Rule 2080 to name FINRA as a party in any action to confirm the award
issued in the above-captioned proceeding. The award directs the expungement of customer
®
dispute information from the Central Registration Depository (CRD ) system. FINRA notes
that the arbitration award reflects compliance with FINRA’s Code of Arbitration Procedure
for Customer Disputes § 12805 or Code of Arbitration Procedure for Industry Disputes §
13805. In addition, it includes an affirmative finding that the expungement directive is based
on one or more standards enumerated in FINRA Rule 2080. Specifically, the expungement
directive is based on one or more of the following affirmative arbitral finding(s):
X the claim, allegation, or information is factually impossible or clearly
erroneous
the above-named individual was not involved in the alleged investment-
related sales practice violation, forgery, theft, misappropriation, or
conversion of funds
X the claim, allegation, or information is false
Therefore, you are not required to name FINRA as a party in the judicial proceeding to
confirm the arbitration award. Furthermore, you are not required to serve FINRA with notice
of the court proceeding documents or to name FINRA as a nominal party.
If you have any questions, please contact me at 240-386-4788.
Sincerely,
Karen Weinstein, Analyst
Registration and Disclosure
Legal and Policy
Exhibit C 12
Preview
FILED DALLAS COUNTY 8/11/2016 1:38:52 PM FELICIA PITRE DISTRICT CLERK DC-16-09763 Freeney Anita NO. FIDELITY BROKERAGE SERVICES LLC, § IN THE DISTRICT COURT OF SEAN PHILLIP OITTINEN; AND § STEPHEN A. FOX, § § Plaintiffs, § § v. § DALLAS COUNTY, TEXAS § JOSEPH SANBERG, § § I-162ND Defendant. § _________ JUDICIAL DISTRICT § APPLICATION TO CONFIRM ARBITRATION AWARD Plaintiffs Fidelity Brokerage Services LLC (“Fidelity”), Sean Phillip Oittinen and Stephen A. Fox (collectively “Plaintiffs”) apply to this Court to confirm an arbitration award pursuant to Section 171.087 of the Texas Civil Practice and Remedies Code (the “Application”). In support of their Application, Plaintiffs respectfully show the following: I. Discovery Level 1. Plaintiffs do not anticipate conducting any discovery. However, should any discovery occur, it should be conducted under Level 2 pursuant to Rule 190.3 of the Texas Rules of Civil Procedure. II. Parties 2. Plaintiff Fidelity is a licensed and incorporated broker/dealer with offices in Dallas County, Texas. 3. Plaintiff Oittinen is an individual who resides in Denton County, Texas, and is an employee of Fidelity. 4. Plaintiff Fox is an individual who resides in Salt Lake County, Utah, and is a former employee of Fidelity. 42327955.1/11404718 -1- 5. Defendant Joseph Sanberg (“Defendant”) is an individual who resides California. Defendant has agreed to accept service via e-mail and does not oppose this application.1 III. Jurisdiction and Venue 6. Plaintiffs bring this Application pursuant to Chapter 171 of the Texas Civil Practice and Remedies Code. Jurisdiction and venue are proper because a part of the underlying actions in the arbitration occurred in Texas and Defendant has agreed to allow Plaintiffs to confirm the expungement award in Texas. IV. Background Facts 7. Defendant initiated an arbitration with the Financial Industry Regulatory Authority (“FINRA”) by filing a Statement of Claim (“SOC”) on or about September 27, 2013, alleging, among other things, that Mr. Oittinen and Mr. Fox made material misrepresentations and omissions to him related to his margin account and that Fidelity conducted an unauthorized liquidation of 85,000 shares of Defendant’s Facebook Inc. stock in his margin account. 8. On or about November 26, 2013, Plaintiffs filed an Answer to the Statement of Claim denying the allegations made (“Answer”). 9. On or about March 6, 2015, the parties entered into a binding settlement agreement whereby Defendant agreed to dismiss all of his claims with prejudice against the Plaintiffs. 10. On or about April 28, 2015, Plaintiffs filed a request for expungement of all references to Defendant’s claims from Mr. Oittinen’s and Mr. Fox’s records held with FINRA’s Central Registration Depository (“CRD”). Mr. Oittinen’s CRD number is 5076825 and Mr. Fox’s CRD number is 5036856. 11. On May 18, 2016, the Arbitrators held an evidentiary hearing on Plaintiffs’ Request for Expungement. 1 See August 1 and July 8, 2016 correspondence, a true and correct copy of which is attached hereto as Exhibit A. -2- 12. On or about May 27, 2016, the Arbitrators issued an Award (the “Award”) dated May 26, 2016 in which the Arbitrators determined: The Panel recommends the expungement of all references to the above captioned arbitration from Respondents Stephen A. Fox and Sean Phillip Oittinen’s registration records maintained by the CRD, with the understanding that pursuant to Notice to Members 04-16, Respondents Stephen A. Fox and Sean Phillip Oittinen must obtain confirmation from a court of competent jurisdiction before the CRD will execute the expungement directive. Unless specifically waived in writing by FINRA, parties seeking judicial confirmation of an arbitration award containing expungement relief must name FINRA as an additional party and serve FINRA with all appropriate documents. Pursuant to Rule 12805 of the Code of Arbitration Procedure (the “Code”), the Panel has made the following Rule 2080 affirmative findings of fact: The claim, allegation, or information is factually impossible or clearly erroneous; and The claim, allegation, or information is false.2 13. In making its ruling, the Arbitrators based their findings on Claimant’s Statement of Claim, Respondents’ Request for Expungement, Respondents’ Request for Expungement, Exhibit E – Margin Agreement, the evidence presented at the expungement hearing, the parties’ settlement agreement, and Mr. Fox’s and Mr. Oittinen’s current BrokerCheck reports.3 Specifically, the Arbitrators found that: . . . neither Fox nor Oittinen caused or failed to act to prevent the transactions executed by Claimant or Claimant’s decision to trade on margin. Neither Fox nor Oittinen could have done anything, nor did they do anything to affect the matter alleged in the claim. Accordingly, the claim, attestation and information is factually impossible and clearly erroneous. Fox and Oittinen did nothing wrong in this matter. Their records should be expunged. The Panel further finds the Second Circuit opinion in de Kwiatkowski v. Bear Stearns & Co., Inc., 306 F.3d 1293 (2nd Cir. 2002) to be material in this matter.4 2 See Award, a true and correct copy of which is attached hereto as Exhibit B. 3 See id. 4 See id. -3- 14. FINRA requires that the Award be confirmed by a Court before FINRA will effectuate the expungement. Therefore, this Application is being filed solely for the purpose of obtaining confirmation of the Award and a corresponding order of expungement. 15. Although FINRA ordinarily requires that it be named as an additional party in any action seeking judicial confirmation of an arbitration award containing expungement relief, FINRA has waived that requirement here pursuant to FINRA Rule 2080.5 V. Conclusion and Prayer WHEREFORE, PREMISES CONSIDERED, Plaintiffs Fidelity Brokerage Services LLC, Sean Phillip Oittinen and Stephen A. Fox pray that this Court confirm the Award rendered by the Arbitrators in FINRA Case No. 13-02835, on or about May 27, 2016, pursuant to Chapter 171 of the Texas Civil Practice and Remedies Code, and enter judgment that all references to the arbitration proceeding and claims asserted therein be expunged from Sean Phillip Oittinen’s and Stephen A. Fox’s registration records maintained with FINRA’s Central Registration Depository. 5 See FINRA Waiver Letter, a true and correct copy of which is attached hereto as Exhibit C. -4- Dated: August 11, 2016 Respectfully submitted, NORTON ROSE FULBRIGHT US LLP /s/ Ellen Sessions Ellen Sessions State Bar No. 00796282 ellen.sessions@nortonrosefulbright.com Nicholas Hendrix State Bar No. 24087708 nick.hendrix@nortonrosefulbright.com 2200 Ross Avenue, Suite 3600 Dallas, TX 75201-7932 Telephone: (214) 855-8000 Facsimile: (214) 855-8200 Megan A. Roberts State Bar No. 24077705 megan.roberts@nortonrosefulbright.com 1301 McKinney, Suite 5100 Houston, TX 77010-3095 Telephone: (713) 651-5480 Facsimile: (713) 651-5246 Attorneys for Plaintiffs CERTIFICATE OF CONFERENCE I hereby certify that I have conferred with Defendant regarding the Application on August 1, 2016. Specifically, I notified Defendant of Plaintiffs’ intent to file an application for confirmation of the arbitration award granting expungement, and inquired whether Defendant would oppose the Application. Defendant does not oppose the application. /s/ Ellen Sessions____ Ellen Sessions CERTIFICATE OF SERVICE I hereby certify that a true and correct copy of the foregoing was served via e-mail on August 11, 2016 addressed to the following: Jeffrey D. Farrow Jfarrow@mrllp.com Todd Stitt Tstitt@mrllp.com 17901 Von Karman Avenue, 10th Floor Irvine, CA 92614 /s/ Megan Roberts____ Megan Roberts -5- From: "Jeff Farrow (OC)" Date: August 1, 2016 at 8:07:53 PM CDT To: "Sessions, Ellen" Subject: RE: FINRA Rule 2080 Waiver Request Grant Letter Yes, we will accept service Sanberg will not oppose the application to confirm the award. Jeffrey D. Farrow The link ed image cannot be display ed. The file may hav e been mov ed, renamed, or deleted. Verify that the link points to the correct file and location. Los Angeles | Orange County | Sacramento | San Francisco | Chicago | New York 17901 Von Karman Avenue, 10th Floor, Irvine, CA 92614 T 714.557.7990 F 714.557.7991 E jfarrow@mrllp.com www.mrllp.com B io v Card From: Sessions, Ellen [mailto:ellen.sessions@nortonrosefulbright.com] Sent: Monday, August 01, 2016 11:51 AM To: Jeff Farrow (OC) Cc: Roberts, Megan Subject: RE: FINRA Rule 2080 Waiver Request Grant Letter Jeff, Two more questions: 1. will you accept service of the application to confirm the award by email? 2. does Sanberg oppose or not oppose the application to confirm the award? Ellen Ellen Sessions | Partner Norton Rose Fulbright US LLP 2200 Ross Avenue, Suite 3600, Dallas, Texas 75201-7932, United States Tel +1 214 855 7465 | Fax +1 214 855 8200 ellen.sessions@nortonrosefulbright.com NORTON ROSE FULBRIGHT Law around the world nortonrosefulbright.com 1 Exhibit A 1 From: Jeff Farrow (OC) [mailto:JFarrow@mrllp.com] Sent: Friday, July 08, 2016 3:10 PM To: Sessions, Ellen Cc: Roberts, Megan Subject: Re: FINRA Rule 2080 Waiver Request Grant Letter Hi Ellen. Joe will consent to jx in Texas. Hope you have a nice weekend. Jeff Jeffrey D. Farrow The link ed image cannot be display ed. The file may hav e been mov ed, renamed, or deleted. Verify that the link points to the correct file and location. Los Angeles | Orange County | Sacramento | San Francisco | Chicago | New York 17901 Von Karman Avenue, 10th Floor, Irvine, CA 92614 T 714.557.7990 F 714.557.7991 E jfarrow@mrllp.com www.mrllp.com B io v Card The contents of this e-mail message and its attachments are intended solely for the addressee(s) hereof. In addition, this e-mail transmission may be confidential and it may be subject to privilege protecting communications between attorneys or solicitors and their clients. If you are not the named addressee, or if this message has been addressed to you in error, you are directed not to read, disclose, reproduce, distribute, disseminate or otherwise use this transmission. Delivery of this message to any person other than the intended recipient(s) is not intended in any way to waive privilege or confidentiality. If you have received this transmission in error, please alert the sender by reply e-mail; we also request that you immediately delete this message and its attachments, if any. UNAUTHORIZED INTERCEPTION PROHIBITED BY FEDERAL LAW (18 U.S.C. 2510-2522). Please consider the environment before printing this email. __________ On Jul 8, 2016, at 08:55, Sessions, Ellen wrote: Jeff, FINRA grated the waiver so we will be preparing the court filing soon. We will file in California unless you tell us you all want Texas and will consent to jurisdiction in Texas and service of process. Please let me know. Ellen Sessions | Partner Norton Rose Fulbright US LLP 2200 Ross Avenue, Suite 3600, Dallas, Texas 75201-7932, United States Tel +1 214 855 7465 | Fax +1 214 855 8200 ellen.sessions@nortonrosefulbright.com NORTON ROSE FULBRIGHT Law around the world nortonrosefulbright.com From: Weinstein, Karen [mailto:Karen.Weinstein@finra.org] Sent: Friday, July 08, 2016 9:29 AM To: Sessions, Ellen Subject: FINRA Rule 2080 Waiver Request Grant Letter SEAN OITTINEN, CRD# 5076825 STEPHEN A. FOX, CRD# 5036856 Ellen, 2 2 Attached please find FINRA’s Rule 2080 Waiver Request grant letter for the above-named individuals. Thanks, Karen Karen Weinstein Analyst Registration and Disclosure Legal and Policy 240-386-4788 Confidentiality Notice:: This email, including attachments, may include non-public, proprietary, confidential or legally privileged information. If you are not an intended recipient or an authorized agent of an intended recipient, you are hereby notified that any dissemination, distribution or copying of the information contained in or transmitted with this e-mail is unauthorized and strictly prohibited. If you have received this email in error, please notify the sender by replying to this message and permanently delete this e-mail, its attachments, and any copies of it immediately. You should not retain, copy or use this e-mail or any attachment for any purpose, nor disclose all or any part of the contents to any other person. Thank you. CONFIDENTIALITY NOTICE: This email, including any attachments, is confidential and may be privileged. If you are not the intended recipient please notify the sender immediately, and please delete it; you should not copy it or use it for any purpose or disclose its contents to any other person. Norton Rose Fulbright entities reserve the right to monitor all email communications through their networks. Norton Rose Fulbright Australia, Norton Rose Fulbright LLP, Norton Rose Fulbright Canada LLP, Norton Rose Fulbright South Africa Inc and Norton Rose Fulbright US LLP are separate legal entities and all of them are members of Norton Rose Fulbright Verein, a Swiss verein. Norton Rose Fulbright Verein helps coordinate the activities of the members but does not itself provide legal services to clients. Details of each entity, with certain regulatory information, are available at nortonrosefulbright.com. 3 3 Award FINRA Dispute Resolution In the Matter of the Arbitration Between: Claimant Case Number: 13-02835 Joseph Sanberg vs. Respondents Hearing Site: Los Angeles, California Fidelity Brokerage Services, LLC Stephen A. Fox Sean Phillip Oittinen ______________________________________________________________________ Nature of the Dispute: Customer vs. Member and Associated Persons This case was decided by an all-public panel. REPRESENTATION OF PARTIES For Claimant Joseph Sanberg, hereinafter referred to as “Claimant”: Todd H. Stitt, Esq., Michelman & Robinson, LLP, Irvine, California. For Respondents Fidelity Brokerage Services, LLC (“Fidelity”), Stephen A. Fox (“Fox”) and Sean Phillip Oittinen (“Oittinen”), hereinafter collectively referred to as “Respondents”: Ellen B. Sessions, Esq., Norton Rose Fulbright US LLP, Dallas, Texas. CASE INFORMATION Statement of Claim filed on or about: September 27, 2013. Claimant signed the Submission Agreement: September 27, 2013. Statement of Answer filed by Respondents on or about: November 26, 2013. Fidelity signed the Submission Agreement: November 21, 2013. Fox signed the Submission Agreement: November 26, 2013. Oittinen signed the Submission Agreement: November 22, 2013. Exhibit B 4 FINRA Dispute Resolution Arbitration No. 13-02835 Award Page 2 of 6 CASE SUMMARY Claimant asserted the following causes of action: failure to treat Claimant in a just and equitable manner; negligence, gross negligence, negligent misrepresentation and omission, and negligent failure to supervise; fraudulent misrepresentation, fraudulent concealment and/or omission and fraudulent inducement and/or promissory fraud; breach of fiduciary duty; breach of contract and breach of the implied covenant of good faith and fair dealing; violation of the Securities Exchange Act of 1934 and Securities Exchange Commission Rules; violation of the Massachusetts Uniform Securities Act; violation of the Massachusetts Consumer Protection Act; and violation of FINRA Conduct Rules. The causes of action relate to Claimant’s investment in Facebook. Unless specifically admitted in their Answer, Respondents denied the allegations made in the Statement of Claim and asserted various affirmative defenses. RELIEF REQUESTED In the Statement of Claim, Claimant requested: 1. Damages based on fairness and equity; 2. Compensatory damages in the amount of $340,000.00; 3. Punitive damages in an amount sufficient to punish a corporation with the net worth of Fidelity, but in an amount at least equal to three times the $340,000.00 at issue, or $1,020,000.00; 4. Attorneys’ fees and costs pursuant to Mass. Gen. L. c. 110A § 410(a)(2)(b) and/or pursuant to Mass. Gen. L. c. 93A §9(2)-(4); 5. Prejudgment interest at a rate of 12% per annum, on all amounts claimed as allowable by law, pursuant to Mass. Gen. L. c. 231 §§ 6B, 6C; and 6. Such other and additional relief as the Panel may deem just and proper. In their Statement of Answer, Respondents requested: 1. Dismissal of Claimant’s claims; and 2. Expungement of all references to this matter from the Central Registration Depository (“CRD”) records of Fox and Oittinen. OTHER ISSUES CONSIDERED AND DECIDED On April 6, 2015, Respondents’ counsel advised FINRA Dispute Resolution that the parties have resolved this matter and requested that FINRA Dispute Resolution keep the case open as Fox and Oittinen will seek expungement. On April 7, 2015, Claimant’s counsel notified FINRA Dispute Resolution that all claims are dismissed with prejudice. On April 28, 2015, Respondents’ counsel submitted a Request for Expungement. No response to the request was filed. A previously appointed Panel conducted a recorded in-person hearing on August 4, 2015 so the parties could present oral argument and evidence on Respondents’ Request for Expungement. Claimant’s counsel attended the hearing and did not oppose the request. 5 FINRA Dispute Resolution Arbitration No. 13-02835 Award Page 3 of 6 On March 10, 2016, FINRA Dispute Resolution appointed the undersigned replacement arbitrators (the “Panel”) to this matter in accordance with the parties’ agreement. On April 11, 2016, Respondents’ counsel resubmitted their Request for Expungement filed on April 28, 2015. No response to the request was filed. On May 18, 2016, the Panel listened to the recorded expungement hearing that took place on August 4, 2015 regarding Respondents’ Request for Expungement. In recommending expungement, the Panel reviewed and relied upon the following: • Claimant’s Statement of Claim; • Respondents’ Request for Expungement; • Respondent’s Request for Expungement, Exhibit E – Margin Account Agreement; and • The recording of the August 4, 2015 expungement hearing. The Panel reviewed the parties’ settlement agreement and considered the amount of payments made to any party and other terms and conditions of settlement. The Panel found that the settlement was not conditioned upon an agreement not to oppose a request for expungement. The Panel also found that Fox and Oittinen did not contribute to the settlement. The Panel considered it significant that Fox and Oittinen did not contribute to the settlement. The Panel also reviewed Fox and Oittinen’s current BrokerCheck reports. The Panel has agreed that the Award in this matter may be executed in counterpart copies or that a handwritten, signed Award may be entered. The Panel acknowledges that they have each read the pleadings and other materials filed by the parties. AWARD After considering the pleadings, the testimony and evidence presented at the August 4, 2015 hearing, the Panel has decided in full and final resolution of the issues submitted for determination as follows: The Panel recommends the expungement of all references to the above- captioned arbitration from Respondents Stephen A. Fox and Sean Phillip Oittinen’s registration records maintained by the CRD, with the understanding that pursuant to Notice to Members 04-16, Respondents Stephen A. Fox and Sean Phillip Oittinen must obtain confirmation from a court of competent jurisdiction before the CRD will execute the expungement directive. Unless specifically waived in writing by FINRA, parties seeking judicial confirmation of an arbitration award containing expungement relief must name FINRA as an additional party and serve FINRA with all appropriate documents. 6 FINRA Dispute Resolution Arbitration No. 13-02835 Award Page 4 of 6 Pursuant to Rule 12805 of the Code of Arbitration Procedure (the “Code”), the Panel has made the following Rule 2080 affirmative findings of fact: The claim, allegation, or information is factually impossible or clearly erroneous; and The claim, allegation, or information is false. The Panel has made the above Rule 2080 findings based on the following reasons: After reviewing the evidence in this case, the Panel finds that neither Fox nor Oittinen caused or failed to act to prevent the transactions executed by Claimant or Claimant’s decision to trade on margin. Neither Fox nor Oittinen could have done anything, nor did they do anything to affect the matter alleged in the claim. Accordingly, the claim, attestation and information is factually impossible and clearly erroneous. Fox and Oittinen did nothing wrong in this matter. Their records should be expunged. The Panel further finds the Second Circuit opinion in de Kwiatkowski v. Bear Stearns & Co., Inc., 306 F.3d 1293 (2nd Cir. 2002) to be material in this matter. FEES Pursuant to the Code, the following fees are assessed: Filing Fees FINRA Dispute Resolution assessed a filing fee* for each claim: Initial Claim Filing Fee =$ 1,800.00 *The filing fee is made up of a non-refundable and a refundable portion. Member Fees Member fees are assessed to each member firm that is a party in these proceedings or to the member firm(s) that employed the associated person(s) at the time of the event(s) giving rise to the dispute. Accordingly, as a party, Fidelity Brokerage Services, LLC is assessed the following: Member Surcharge =$ 2,800.00 Pre-Hearing Processing Fee =$ 750.00 Hearing Processing Fee =$ 5,000.00 Adjournment Fees Adjournments granted during these proceedings for which fees were assessed: October 14-17, 2014, adjournment by parties =$1,200.00 ______________________________________________________________________ Total Adjournment Fees =$1,200.00 1. The Panel has assessed $600.00 of the adjournment fees to Claimant. 7 FINRA Dispute Resolution Arbitration No. 13-02835 Award Page 5 of 6 2. The Panel has assessed $600.00 of the adjournment fees jointly and severally to Respondents. Hearing Session Fees and Assessments The Panel has assessed hearing session fees for each session conducted. A session is any meeting between the parties and the arbitrator(s), including a pre-hearing conference with the arbitrator(s), that lasts four (4) hours or less. Fees associated with these proceedings are: Three (3) Pre-hearing sessions with the Panel @ $1,200.00/session =$3,600.00 Pre-hearing conferences: February 11, 2014 1 session December 3, 2014 1 session April 7, 2016 1 session Two (2) Hearing sessions on expungement request @ $1,200.00/session Hearing Date: August 4, 2015 2 sessions =$2,400.00 Total Hearing Session Fees =$6,000.00 1. The Panel has assessed $1,800.00 of the hearing session fees to Claimant. 2. The Panel has assessed $4,200.00 of the hearing session fees jointly and severally to Respondents. All balances are payable to FINRA Dispute Resolution and are due upon receipt. 8 May 27, 2016 9 May 27, 2016 10 May 27, 2016 11 July 8, 2016 Ellen Sessions Norton Rose Fulbright US LLP 2200 Ross Avenue, Suite 3600 Dallas, TX 75201 Re: SEAN OITTINEN, CRD# 5076825 STEPHEN A. FOX, CRD# 5036856 FINRA Arbitration Case #: 13-02835 Joseph Sanberg vs. Fidelity Brokerage Services, LLC, Stephen A. Fox, Sean Phillip Oittinen Dear Ms. Sessions: FINRA has reviewed, and determined to grant, your request for a waiver of the obligation under FINRA Rule 2080 to name FINRA as a party in any action to confirm the award issued in the above-captioned proceeding. The award directs the expungement of customer ® dispute information from the Central Registration Depository (CRD ) system. FINRA notes that the arbitration award reflects compliance with FINRA’s Code of Arbitration Procedure for Customer Disputes § 12805 or Code of Arbitration Procedure for Industry Disputes § 13805. In addition, it includes an affirmative finding that the expungement directive is based on one or more standards enumerated in FINRA Rule 2080. Specifically, the expungement directive is based on one or more of the following affirmative arbitral finding(s): X the claim, allegation, or information is factually impossible or clearly erroneous the above-named individual was not involved in the alleged investment- related sales practice violation, forgery, theft, misappropriation, or conversion of funds X the claim, allegation, or information is false Therefore, you are not required to name FINRA as a party in the judicial proceeding to confirm the arbitration award. Furthermore, you are not required to serve FINRA with notice of the court proceeding documents or to name FINRA as a nominal party. If you have any questions, please contact me at 240-386-4788. Sincerely, Karen Weinstein, Analyst Registration and Disclosure Legal and Policy Exhibit C 12