You ever see this one? "The causes of action relate to option trading in Overstock.com and the Chicago Mercantile Exchange."
Below is the rogues gallery
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Award
FINRA Dispute Resolution
In the Matter of the Arbitration Between:
George IHamboussi (Claimant) vs. First Southwest Company. Susan M. Diamond.
Dominick Maiorano, Ronald Heineman, Robert DePaio, Robert Fallah. Gary Schonwaid,,
Ahmed Abdelmawla Gadelkareem a/k/a Ahmed Kareem, and Vertical Capital Partners,
Inc. (Respondents)
Case Number: 05-03475 Hearina Site: New York. New York
Nature of the Dispute: Customer vs. Members and Associated Persons.
REPRESENTATION OF PARTIES
Claimant George IHamboussi ("Claimant"): James A. Prestiano, Esq.. The Law Offices
of James A. Prestiano, PC. New York, NY.
Respondent First Southwest Company ("First Southwest"): Nancy Thomas, First
Southwest Company. Dallas, TX. Previously represented by Christopher Richie, Esq..
Patton Boggs LLC, Dallas, TX.
Respondents Susan M. Diamond ("Diamond"), Ronald Heineman ("Heineman"), Robert
DePaio ("DePalo"), Robert Failah ("Fallah"), Gary Schonwaid ("Schonwaid"), and Vertical
Capital Partners, inc. ("Vertical Capital"): Andrew J. Goodman, Esq., Garvey Schubert
Barer, New York, NY. Andrew J. Goodman was formerly with the fimn of Kurzman
Eisenberg Corbin Lever & Goodman, LLP, New York, NY.
Respondent Ahmed Abdelmawla Gadelkareem a/k/a Ahmed Kareem ("Gadelkareem")
appeared pro se. Gadelkareem was previously represented by Andrew J. Goodman,
Esq., Garvey Schubert Barer, New York. NY. Andrew J. Goodman was fonnerly with the
firm of Kurzman Eisenberg Corbin Lever & Goodman, LLP, New York, NY.
Respondent Dominick Maiorano ("Maiorano") appeared pro se. Maiorano was previously
represented by Andrew J. Goodman, Esq., Garvey Schubert Barer, New York, NY.
Andrew J. Goodman was fonnerly with the finn of Kurzman Eisenberg Corbin Lever &
Goodman. LLP. New York, NY.
CASE INFORMATION
Statement of Claim filed on or about: July 8. 2005.
Amended Statement of Claim filed on or about: December 22, 2005.
Claimant signed the Uniform Submission Agreement: May 6, 2005.
Statement of Answer and Motion to Dismiss filed by First Southwest on or about:
September 12, 2005.
Answer to the Amended Statement of Claim and Motion to Dismiss filed by First
FINRA Dispute Resolution
Arbitration No. 05-03475
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Southwest on or about: March 9,2006.
First Southwest signed the Uniform Submission Agreement: September 21. 2005.
Joint Statement of Answer filed by Vertical Capital, Diamond, and Gadelkareem on or
about: September 21. 2005.
Joint Answer to the Amended Statement of Claim and Motion to Dismiss filed by
Vertical Capital, Diamond. Gadelkareem, Heineman. DePaio, Fallah, Schonwaid, and
Maiorano on or about: March 14, 2006.
Vertical Capital signed the Uniform Submission Agreement: September 20, 2005.
Diamond did not sign the Uniform Submission Agreement.
Gadelkareem signed the Uniform Submission Agreement: September 20, 2005.
hHeineman did not sign the Uniform Submission Agreement.
DePaio did not sign the Uniform Submission Agreement.
Fallah did not sign the Uniform Submission Agreement.
Schonwaid did not sign the Uniform Submission Agreement.
Maiorano did not sign the Uniform Submission Agreement.
CASE SUMMARY
Claimant asserted the following causes of action in his Statement of Claim and
Amended Statement of Claim: breach of contract, negligence, failure to supervise,
breach of fiduciary duty, misrepresentation/non-disclosures, unauthorized trading,
manipulations, suitability, and omissions. The causes of action relate to option trading in
Overstock.com and the Chicago Mercantile Exchange.
Unless specifically admitted in its Answer to the Statement of Claim or Amended
Statement of Claim. First Southwest denied the allegations made in the Statement of
Claim and Amended Statement of Claim and asserted various affirmative defenses.
Unless specifically admitted in their Answer to the Statement of Claim, Vertical Capital,
Diamond, and Gadelkareem denied the allegations made in the Statement of Claim and
asserted various affirmative defenses.
Unless specifically admitted in their Answer to the Amended Statement of Claim,
Vertical Capital. Diamond. Gadelkareem. Heineman, DePaio, Fallah, Schonwaid, and
Maiorano denied the allegations made in the Statement of Claim and asserted various
affirmative defenses.
RELIEF REQUESTED
In the Statement of Claim and Amended Statement of Claim, Claimant requested
compensatory damages in the amount of $525,000.00, punitive damages in the anrount
of $400,000.00, attorneys' fees, costs, disbursements, and such other relief as the
Panel deems appropriate.
in its Statement of Answer, First Southwest requested that Claimant's claims be dismissed
In their entirety.
FINRA Dispute Resolution
Arbilration No. 05-03475
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In their Statement of Answer, Vertical Capital, Diamond, and Gadelkareem requested
that Claimant's claims be dismissed in their entirety and that it be awarded costs,
attorneys' fees, forum fees, and such other relief as may be awarded by the Panel.
In their Answer to the Amended Statement of Claim, Vertical Capital, Diamond,
Gadelkareem, Heineman, DePaio, Fallah, Schonwaid, and Maiorano requested that
Claimant's claims be dismissed in their entirety and that it be awarded costs and attorneys'
fees, fomm fees, and such other relief as may be awarded by the Panel.
OTHER ISSUES CONSIDERED AND DECIDED
Respondents Diamond, Heineman, DePaio. Failah, Maiorano. and Schonwaid. did not
file with FINRA Dispute Resolution properly executed Uniform Submission Agreements
but are required to submit to arbitration pursuant to the Code and having answered the
claim, appeared and testified at the hearing, are bound by the determination of the
Panel on all issues submitted.
On or about December 9,2005, the Panel permitted Claimant to amend his Statement
of Claim to add the following additional parties: Heineman, DePaio, Fallah, Schonwaid,
and Maiorano.
On or about April 26,2006, the Panel granted First Southwest's Motion to Dismiss.
At the September 16, 2008 hearing, Claimant entered into a stipulation of settlement
with Vertical Capital, Diamond, Heineman, DePaio, Fallah, and Schonwaid. The claim
continued to proceed against Gadelkareem and Maiorano.
At the March 30, 2009 hearing, Maiorano appeared at the hearing by phone. The Panel
advised Maiorano that he was required to make an in-person appearance and that he
would not be permitted to testify by phone. Maiorano then disconnected the call and the
Panel detennined to proceed with the hearing without Maiorano.
At the hearing Claimant amended his compensatory damage claim from $575,000.00 to
$360,000.00.
The parties agreed that the Award in this matter may be executed in counterpart copies
or that a handwritten, signed Award may be entered.
Panel Findings
It has come to the Panel's attention that Gadelkareem has already written and intends
to write letters to the Disciplinary Committee of the Second Department regarding
attorney James A. Prestiano's conduct during the course of this proceeding.
The Panel wishes to state unequivocally that James A. Prestiano's conduct has been
entirely professional and that the Panel has not seen any evidence which could even
suggest the slightest impropriety on his part.
FINRA Dispute Resolution
Arbitration No. 05-03475
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AWARD
After considering the pleadings, the testimony and evidence presented at the hearing,
the Panel has decided in full and final resolution of the issues submitted for
determination as follows:
1. Claimant's claims are denied in their entirety.
2. Any and all relief not specifically addressed herein, including punitive damages,
is denied.
FEES
Pursuant to the Code, the foiiowing fees are assessed:
Fllino Fees
FINRA Dispute Resolution will retain or collect the non-refundable filing fees for each
claim:
initial claim filing fee = $ 375.00
Member Fees
Member fees are assessed to each member firm that is a party in these proceedings or
to the member firms that employed the associated persons at the time of the events
giving rise to the dispute. Accordingly. First Southwest Company and Vertical Capital
Partners. Inc., as parties, are assessed the following:
Member surcharge = $2,250.00
Pre-hearing process fee = $ 750.00
Hearing process fee = $4,000.00
Adiournment Fees
Adjournments granted during these proceedings for which fees were assessed:
July 18.19, 20, 25, 26, and 27, 2006 adjournment by ail parties Waived
October 24, 25,26,2006 adjournment by Claimant = $ 1,200.00
April 10,11,12, 16, 17,19, 2007 adjournment by Diamond, Heineman,
DePaio, Fallah, Schonwaid, Gadelkareem, and Vertical Capital Waived
July 24,25, 26, 31, 2007, August 1 and 2.2008 adjournment by
Diamond, Heineman, DePaio, Fallah, Schonwaid. Gadelkareem,
and Maiorano =$ 1,500.00
Three-Day Cancellation Fees
Fees apply when a hearing on the merits is postponed or settled within three business
days before the start of a scheduled hearing session:
October 24, 25. 26, 2006 adjournment by Claimant = $ 300.00
FINRA Dispute Resolution
Arbitration No. 05-03475
Award Page 5 of 6
Forum Fees and Assessments
The Panel has assessed forum fees for each session conducted. A session is any
meeting between the parties and the arbitrators, including a pre-hearing conference with
the arbitrators, that lasts four (4) hours or less. Fees associated with these proceedings
are:
One (1) Pre-hearing session with a single arbitrator @ $450.00
Pre-hearing conference: April 5,2006 1 session
Three (3) Pre-hearing sessions with Panel @ $1,200.00
Pre-hearing conferences: December 5,2005 1 session
February 7, 2006 1 session
January 25,2007 1 session
Nineteen (19) Hearing sessions @ $1,200.00
Hearing Dates:
December 5,2007 2 sessions
December 6,2007 2 sessions
December 7, 2007 2 sessions
April 21, 2008 2 sessions
April 22, 2008 2 sessions
April 23,2008 2 sessions
September 16,2008 2 sessions
December 2, 2008 2 sessions
March 30. 2009 2 sessions
March 31. 2009 1 session
Total Hearing Session Fees
= $ 450.00
= $ 3,600.00
= $22,800.00
= $26,850.00
1. The Panel has assessed $13,425.00 of the forum fees to Claimant.
2. The Panel has assessed $13,425.00 of the forum fees to Gadelkareem.
All balances are payable to FINRA Dispute Resolution and are due upon receipt.
hiNKA Dispute Resolution
ArbUratton No. 05-03475
Richard C. Cutler
Toby S. DeSimone
Marc R. Green
ARBITRATION PANEL
Public Arbitrator, Presiding Chairperson
Public Arbitrator
Non-Public Ariaitrator
I, the undersigned Arbitrator, do hereby affinn, pursuant to Article 7507 of the Civil
Practice Law and Rules, that I am the Individual described herein and who executed this
Instrument which is my award.
Concuning Arbitrators' Signatures
Richard C. Cutler
Public Arbitrator, Presiding Chairperson
Toby S. DeSimone
Public Arbitrator
Signature Date
Marc R. Green
Non-Public Arbitrator
Signature Date
April 8,2009
Date of Sen/ice (For FINRA Dispute Resolution use only)
FINRA Dispute Resolution
Artiitration No. 05-03475
Award Pace 6 of 6
ARBITRATION PAHEL
Richard C. Cutler - Public Arbitrator. Presiding Chaiiperson
Toby S. DeSimone - Public Arbitrator
Marc R. Green Non-Public Arbitrator
1, the undersigned Arbitaator, do hereby affirm, pursuant to Article 7507 of the Civil
Practice Law and Rules, that 1 am the individual described herein and who executed this
instrument which is my award.
Concurring Arbltratoia' Slanatures
Richard C. Cutler Signature Date
Public Arbitrator, Presiding Cliairperson
Toby ^ . DeSinrone Sigruiture Date
Public Arbitrator
Marc R. Green Signahjre Date
Non-Public Arbitrator
April 8,2009
Date of Service (For FINRA Dispute Resolution use only)
FINRA Dispute Resolution
Art>itFatlon No. 05-03475
Award PaaeSofB
Richard C. Cutler
Toby S. DeSimone
Marc R. Green
ARBITRATION PANEL
Public Art)ltrator, Presiding Chairperson
Public Arbitrator
Non-Public Arbitrator
I, the undersigned Arbitrator, do hereby affirm, pursuant to Article 75D7 of the Civil
Practice l^w and.Rules, that i am the Individual described herein and who executed ^ is
Instmment which Is my award.
Concurring Arbitratore' Signatures
Richard C. Cutler
Public Arbitrator, Presiding Chairperson
Signature Dale
Toby S. DeSimone
Public Arbitrator
Marc-R. Green
Non-Public Ariaftrator
Signature Date
? 2<£?£)9
•^Pril 8, 2009
Date of Service (For RNRA Dispute Resolution use only) |
