Simplified Arbitration Part Four – Discovery in Simplified Arbitration

By Geoff Hafer, Spring 2016 Student Intern

So in part four of the Simplified Arbitration series, we are looking at discovery in Simplified Arbitration.

Now some might say, hey limited discovery that’s good right?

In some cases, that may be all that is needed. Under FINRA Rule 12800, parties may request documents and other information from each other. If parties choose to conduct discovery, they are instructed to send a written communication advising the assigned FINRA staff person and all other parties that they are requesting that the assigned arbitrator allow time for completion of discovery. All requests for documents and other information then must be served on all other parties, and filed with FINRA, within 30 days from the date that the last Answer is due.

Here’s where things get tricky – If there are any objections to a discover request they must be served on all other parties and filed with FINRA within 10 days of the receipt of the requests. This is a very limited timeframe and parties must respond quickly to ensure nothing is missed. Communication back and forth between attorneys and clients can often times take several days and production of documents even longer. So although the quick turnaround is appealing at first, it can sometimes lead to serious time constraints and missing documents.

Well what documents should be included or not in Simplified Arbitration?

This can also get tricky. FINRA’s Discovery Guide outlines documents that the parties should exchange without arbitrator or staff intervention. The arbitrator may, in his or her discretion, choose to use relevant parts of the Discovery Guide in a manner consistent with the expedited nature of Simplified proceedings. This again leaves wide discretion to the arbitrator in deciding what is permissible in discovery and not. Documents that the other side feels are “overly burdensome” to obtain can often times be excluded.

With so much discretion, who are these arbitrators and how are they appointed?

We will address this question in the final topic of the Simplified Arbitration Series – who are the arbitrators and how are they appointed in Simplified Arbitration.