Legal Question in Securities Law in California

The proposed settlement is within a range that would be considered fair by many attorneys, in view of the possibility of losing, being awarded less, or winning but having to pay attorney fees. Without full particulars, however, that's only a generalization....your case might be a slam dunk for 50K plus attorney fees.

I would not change the "without prejudice" language. Understand that "prejudice" here means that the issue has been fully adjudicated so that any future litigation is barred under the doctrines of "res judicata" (decided matters) and collateral estoppel. When a potential suit is settled "without prejudice," the injured party is not barred from suit in the future.

As to the release's effect on claims regarding other portfolio assets, I have seen releases written so tightly that they bar any future claims between the parties on any aspect of their relationship as of the date of the release, even where the claim has not yet arisen. I'd get independent advice as to whether your assets can be moved to a different account with a different manager, or sold and the proceeds reinvested, or what the release covers and does not cover.

The term 'prejudice" means whether or not the right to sue is forever waived. You do not want to waive it as technically you might flind some other damages you wish to sue on. As a practical matter it is doubtful that you need a "without prejudice" dismissal, but it does not hurt you to have one. So do not change that portion of the agreement.

A dismissal applies only to the claims made in the arbitration and those not made but reasonably related. If you sued on the basis that the broker misapplied all of your funds, as opposed to just stating you claim is merely as to the $40,000, then a dismissal would not effect the future claims. Generally a release covers all the misdeeds you know or reasonably should have known of that sprang from the same general behavior. I think you probably are safe to agree to the settlement as now written as you have suffered no damages at this point as to the leases.

As to the settlement amount, it may be best to take it. I assume that your half of the arbitration costs are not recoverable; my guess is your costs will be at least $1,000 in administrative fees for the arbitration, $500 per hour for the arbitrator's time for at least 10 hours, $1,000 for your expert witness--that is $7,000 and may be cheap. I had for several weeks before my client filed for bankruptcy, a case with S.F. attorney Jeffery Feldman,

"[email protected]" , who seemed knowledgeable, reasonable, and an expert who could tell you whether accepting the settlement is a good idea and should you put in any additional clauses. Spending $700-800 for two hours of attorney time is worthwhile when you are considering what you might get further.

I handle FINRA arbitration as a large part of my practice now. Your case sounds typical of many suitability and due diligence cases I work on, without me naming specific tenancies in common. I dont know for sure if $30k is good or not unless I assess your case, which I am happy to do. I sometimes calculate a loss to include the entire investment amount - your $200k, plus interest, attorneys fees, and sometimes punitives. If you are unrepresented, and they are offering you 30k, that may be a signal that your case may be worth a lot more. Defense attorneys often play games with people who do not know what to look for assessing a case's value. Also, I have no idea how solvent the company is. A settlement should be for the entire matter, not just the financial advisor. If I would do work for you, I can take such cases in contingency, and you may end up doing much better even after my %. If they sold you oil, land, and other illiquid investments, those may be recoverable as well sometimes. There are a lot of bad oil and land investments that financial advisors have no business selling, and rescission can be a remedy, sometimes with interest on top. I may be familiar with your particular investments, as different clients often bring the same tics, same oil deals, same sponsors and same investment firms. I may also have evidence against your particular investment you may not have. You should have me assess your case for free. After knowing your case better, if you choose to, we can easily amend your claim so you can recover everything you are entitled to.

Please contact me by email or phone.

Best,

Daniel Bakondi, Esq. [email protected] 415-450-0424

The Law office of Daniel Bakondi, APLC

870 Market Street, Suite 1161

San Francisco CA 94102

http://www.danielbakondi.com

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