Merrill Ordered to Pay Couple for Investment Loss, Journal Says
Pittsburgh, Aug. 28 (Bloomberg) -- Merrill Lynch & Co., the
biggest U.S. securities firm by capital, was ordered by an
arbitration panel to pay $7.7 million to a Pennsylvania couple for
failing to advise them of ways to protect an investment, the Wall
Street Journal reported, citing the ruling.
Douglas and Deborah Millar told an arbitration panel that
Merrill hadn't given them advice on their investment in
FreeMarkets Inc., a maker of Internet auction software, and hadn't
executed a sell order they placed for half their stake in
September 2000, before the stock plunged, the newspaper said.
The Millars told the three-member tribunal they invested a
total of $200,000 for 200,000 shares when the company was
privately held, and the stock rose from $48 a share when it was
first sold to the public to a peak of $280 on its first day of
trading in December 1999, the Journal said; it closed at $6.86 on
the Nasdaq on Tuesday.
An unidentified Merrill spokesman told the paper the company
will appeal to the U.S. District Court in Pittsburgh, saying the
sell order was never placed, and that the company had met its
obligations as a broker.
Merrill Lynch is a passive minority investor in Bloomberg LP,
the parent of Bloomberg News.
(Wall Street Journal 8-28)
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