The United States District Court for the District of Massachusetts, recently, ruled that a FINRA Arbitrator must consider any counterclaims in an action brought against Trustees of a profit sharing plan. 

The Federal Court had refused the argument advanced by the Plan’s Trustees that naming them individually was improper under FINRA’s rules.  The Court found that such claims were actually being brought in their capacity as Trustees, and, as such, were subject to a counterclaim in the FINRA Arbitration.  The Court believed that such counterclaims should be heard in a FINRA proceeding.

This decision evidences the reach that Courts will traverse to ensure that arbitration is the preferred forum for these matters, and not piecemeal litigation in courts.