COURT COMPELS FINRA ARBITRATION OF EMPLOYMENT DISPUTE
Kevin Imhoff left his job as a broker for Primerica, for whom he sold various securities and insurance products, to go work for a competitor. He sued Primerica in state court, alleging that they harmed his relationship with his clients and with AIG (one of the insurance companies whose products he sold), as a result of various communications Primerica sent announcing his departure. Primerica filed a petition in federal court seeking to compel arbitration under FINRA. Imhoff conceded he agreed to arbitrate certain disputes, as set forth in his FINRA registration, but that the dispute pertaining to his sale of insurance products was exempt from arbitration by FINRA Rule 13200. The Court rejected this claim, narrowly construing Rule 13200’s exception for “insurance related claims,” which states that “disputes arising out of insurance business activities of a member that is also an insurance company are not required to be arbitrated under FINRA,” and finding that it does not encompass employment disputes, but rather only “intrinsically insurance” claims. The Court compelled arbitration of all claims. PFS Investments, Inc. v. Imhoff, No. 11-10142 (USDC E.D. Mich. March 25, 2011).
This post written by John Pitblado.
