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Learn about the new subpoena rule and view the new process.

New Rules Effective April 2, 2007

The Securities and Exchange Commission (SEC) approved amendments to the subpoena rule and the payment of arbitrators rule. NASD, now FINRA, amended the subpoena rule to permit only arbitrators to issue subpoenas, whether for discovery in arbitration or for the appearance at a hearing before the arbitrators. We also amended the payment of arbitrators rule to provide for the payment of a $200 honorarium per case for each arbitrator who considers contested motions for the issuance of subpoenas.

Only Arbitrators Have the Authority to Issue Subpoenas

The subpoena rule was amended to permit only arbitrators to issue subpoenas for both parties and non-parties, whether for discovery or for the appearance at a hearing. Parties should send their requests for issuance of a subpoena to the FINRA Director of Arbitration and to all other parties at the same time and in the same manner. The request must be in the form of a written motion and must include a draft subpoena. The requesting party may not serve the motion or draft subpoena on a non-party.

If another party objects to the scope or propriety of the subpoena, that party must within 10 calendar days of service of the motion-file written objections with the Director, with an additional copy for the arbitrator, and must serve copies on all other parties at the same time and in the same manner as on the Director. The party that requested the subpoena may respond to the objections within 10 calendar days of receipt of the objections. After considering timely objections, the arbitrator responsible for deciding discovery-related motions will rule promptly on the issuance and scope of the subpoena. Arbitrators will use their discretion to determine whether or not to issue a subpoena, and whether or not to limit the scope of a subpoena before it is issued.

After the requesting party receives subpoenaed documents from a non-party, the requesting party must notify all other parties within five calendar days of receipt. If another party requests copies of documents that were received in response to a non-party subpoena, the party that requested the documents must provide the copies within ten calendar days. The arbitration panel has authority to determine the amount of costs incurred as a result of subpoenaed documents and by whom such costs should be borne.

Payment to Arbitrators for Deciding Contested Subpoena Requests

FINRA has amended the payment of arbitrators rule to provide a $200 honorarium for each arbitrator who decides contested motions for subpoenas. Under most circumstances, the chairperson will be the only arbitrator to consider the subpoena requests based on the documents supplied by the parties. If a party requests that the entire panel decide the contested motion, each arbitrator who participates in the decision on the subpoena will receive an honorarium of $200. The honorarium will be paid on a per case basis, regardless of the number of contested subpoena motions considered by an arbitrator or panel during the case. Furthermore, the maximum amount that will be paid by the parties for any one case will be $600.

Both rules are effective on April 2, 2007. For additional information, please see Notice to Members 07-13.