A Financial Industry Regulatory Authority (FINRA) arbitration panel has awarded $2,200,000.00 ? 100% of the compensatory damages requested ? to Thomas F. Motamed, the Chairman and CEO of CNA Financial Corp., and his wife Christine Motamed, as a result of losses they sustained in Lehman structured products sold to them by UBS Financial Services, Inc., according to articles by Suzanne Barlyn in Dow Jones Newswires (“UBS To Pay $2.2 Mln to CAN Chief for Lehman-Related Losses”) and Lorie Konish’s on Wall Street article (“UBS To Pay $2.2M In Arbitration Settlement”).
The panel ordered UBS to buy back the notes from the couple at their original cost. In addition, the panel assessed the full costs of the hearing, in the amount of $13,650.00, against UBS. The case is Motamed v. UBS Financial Services, Case Number 09-02087, decided December 16, 2010.
The FINRA arbitrators apparently concluded that Motamed’s stature and experience as a chief executive of a financial company did not mean that he understood the nature and risks of Lehman structured products. “The clients I’ve represented have all been experienced investors,” said Seth Lipner, a partner of Deutsch & Lipner in New York, who is also representing Lehman structured products investors against UBS. “But the first things we discovered when we looked at these structured products is that they haven’t been around for a long time. So I’m not sure how much experience anyone has with them.”
“We believe this award, like the others, shows the arbitrators believe UBS misnamed, mismarketed and misrepresented these products,” said Mr. Lipner.
“UBS knew that Lehman was in trouble as far back as October 2007, but they continued to sell Lehman structured products anyway, ignoring the ever-growing risk,” Mr. Lipner observed, adding: “Not only weren’t they candid with the public, they weren’t candid even with their own brokers.”
In earlier cases where Mr. Lipner represented investors who bought Lehman principal protected structured products from UBS (Severi vs. UBS, decided in December 2009, and Marcus et al. v. UBS, decided April 2010), and Edelson v. UBS, decided October 2010, arbitration panels also ordered UBS to buy back the investments.
UBS, which reportedly sold $1 billion of Lehman structured products to U.S. investors, is facing many similar arbitration claims across the country, and has reportedly not yet won a single such case.
“These are highly complex products; they are too complex for ordinary investors to evaluate. We have obviously been successful in proving that,” Mr. Lipner noted.
Page Perry, a law firm based in Atlanta, Georgia, is co-counsel with Mr. Lipner and his Garden City, New York law firm, Deutsch & Lipner, in representing a number of investors in Lehman structured note cases.
“We continue to receive inquiries from investors who acquired Lehman structured notes as a result of UBS’s misrepresentation of it as a ‘principal protected’ investment,” said J. Boyd Page, a senior partner at Page Perry in Atlanta. “Our legal team continues to investigate and pursue arbitrations on behalf of investors who purchased these products,” he added. The brokers who sold the Lehman structured notes are not targets of investor claims.
Page Perry is an Atlanta-based law firm with over 125 years collective experience representing institutional and individual investors in securities-related litigation and arbitration all over the country. While past results are not indicative of future success, Page Perry’s attorneys have recovered over $1,000,000 for clients on more than 40 occasions.