February 1, 2013
Publication: The Wall Street Journal
Kobre & Kim successfully secured an award for $30 million on behalf of US Airways Inc. against its former broker-dealer Oppenheimer & Co. Inc. in a customer arbitration before the Financial Industry Regulatory Authority (FINRA) in New York. The dispute involved claims relating to Oppenheimer’s purchase of auction-rate securities that became illiquid in August 2007, which US Airways claimed were unsuitable for its cash management accounts. The securities at issue were esoteric, highly structured products that occupied a little-known, tiny sliver of what once was a US $330 billion-plus auction-rate securities market. Following 64 days of evidentiary hearings, the three-member FINRA panel issued a $30 million award against Oppenheimer and its broker. The panel found the broker liable up to the amount of his commissions.