NASD Notice to Members 02-68 - October 2002

SEC Approves Rule Change to IM-10100

Executive Summary

Industry parties in California arbitration proceedings must waive contested California arbitrator disclosure standards if all parties who are investors, or associated persons with claims of statutory employment discrimination, have executed waiver agreements.

 

The Securities and Exchange Commission (SEC or Commission) has approved amendments to IM-10100 of the NASD Code of Arbitration Procedure (Code) governing Failure to Act Under Provisions of Code of Arbitration Procedure. The amendments provide that members and associated persons involved in NASD arbitration proceedings in the State of California are required to waive application of California Ethics Standards for Neutral Arbitrators in Contractual Arbitration (the "California Standards") to their arbitration proceedings upon the request of investors or, in industry cases, of associated persons with claims of statutory employment discrimination, for a six-month pilot period (or until the conclusion of pending litigation contesting application of the standards to NASD).

 

The new procedures will apply to the appointment of arbitrators on or after September 30, 2002, to serve in California arbitrations.

 

Questions regarding this Notice may be directed to Jean I. Feeney, Chief Counsel and Associate Vice President, NASD Dispute Resolution, at (202) 728-6959, or e-mail.