Prospective clients frequently ask me about their “chances” in securities arbitration. FINRA reports the “win” rate of customer initiated arbitrations. For the past decade, the “win” rate has never been more 50%. I recall that in the late 80s and early 90s, the “win” rate was occasionally in the 51% – 54% range. FINRA recently reported the statistics for arbitration cases filed in 2008 compared to prior years. In 2008, the “win” rate for customer initiated arbitrations that actually went to a hearing and were decided by the arbitrators was 42%. That was up from 36% in 2007, but was comparable to the 2006 statistics. It is not a very high percentage, but one argument is that the better cases settle before going to hearing and the weaker cases actually get tried and decided by the arbitrators. You have to keep in mind, however, that a “win” is any amount decided in favor of the customer. If a customer is awarded 10% of his or her damages, that is considered a “win.” It is very infrequent that a customer is awarded 100% of his or damages. For a link to the 2008 FINRA statistics, click here:

http://www.finra.org/ArbitrationMediation/AboutFINRADR/Statistics/index.htm

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