Shea v Windsor St. Capital, L.P.

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Shea v Windsor St. Capital, L.P. 2018 NY Slip Op 32681(U) October 18, 2018 Supreme Court, New York County Docket Number: 654371/2018 Judge: Eileen A. Rakower Cases posted with a "30000" identifier, i.e., 2013 NY Slip Op 30001(U), are republished from various New York State and local government sources, including the New York State Unified Court System's eCourts Service. This opinion is uncorrected and not selected for official publication. [* 1] INDEX NO. 654371/2018 NYSCEF DOC. NO. 15 RECEIVED NYSCEF: 10/19/2018 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK: PART 6 ----------------------------------------------------------)( Index No. 654371/2018 Patrick Shea and Mary Shea, Petitioners, DECISION AND ORDER Mot. Seq. 3 - against Windsor Street Capital, L.P., f/k/a Meyers Associates, L.P., Respondent. ----------------------------------------------------------)( HON. EILEEN A. RAKOWER, J.S.C. This is a special proceeding commenced pursuant to CPLR §7510 to confirm an arbitration award. The arbitration award was rendered in Wisconsin, Milwaukee on or about August 13, 2018, by a panel of three arbitrators in the FINRA Dispute Resolution forum (the "Award") in the arbitration captioned Patrick Shea and Mary Shea v. Windsor Street Capital, LP, and Bruce Meyers, FINRA Case No. 1700360 (the "Arbitration"). Windsor Street Capital, L.P., f/k/a Meyers Associates, L.P. ("Windsor") is a New York limited partnership, licensed to do business in New York with its principal place of business located at 45 Broadway, 2nd Floor, New York, New York, 10006. Background On or about February 9, 2017, Petitioners commenced the Arbitration by filing with FINRA Dispute Resolution a Statement of Claim against respondents, Windsor Street Capital, L.P. ("Windsor") and Bruce Meyers ("Meyers"). Petitioners asserted the following claims: fraudulent trades in violation ofFINRA Rules, state blue sky laws, and Section lO(b) and Rule lOb-5 of the Securities Exchange Act of 1934; violation ofFINRA Rules 2010, IM-2310-2, and 2020; and 2 of 5 [* 2] INDEX NO. 654371/2018 NYSCEF DOC. NO. 15 RECEIVED NYSCEF: 10/19/2018 failure to supervise broker conduct. These claims related to Windsor's alleged failure to supervise the broker, who excessively and unlawfully traded certain securities in their accounts. On or about June 20, 2017, Windsor agreed to participate in the Arbitration by filing with FINRA Dispute Resolution a Statement of Answer in response to Petitioners' Statement of Claim. On July 17, 2018, the Panel of three FINRA arbitrators conducted an inperson hearing to decide Petitioners' claims (the "Hearing"). Petitioners attended the Hearing. Respondents did not. At the hearing, Petitioners advised the Panel that they had reached a settlement with Meyers. On or about August 11, 2018, the FINRA arbitration Panel rendered a decision in the Arbitration. The Award states: After considering the pleadings, the testimony and evidence presented at the hearing, the Panel has decided in full and final resolution of the issues submitted for determination as follows: 1. Windsor is liable for and shall pay to Claimants the sum of $1,380,804.00 in compensatory damages. 2. Windsor is liable for and shall pay to Claimants interest on the above-stated sum at the rate of 5% per annum, from and including the date of service of this Award, through and including the date this Award is paid in full. 3. Windsor is liable for and shall pay to Claimants the sum of $3,000,000.00 in punitive damages pursuant to Wis. Stats. § 895.043 and Mastrobuono v. Shearson Lehman Hutton, Inc., 514 U.S. 52 (1995). 4. Windsor is liable for and shall pay to Claimants the sum of $552,321.60 in attorneys' fees pursuant to Wis. Stats. § 551.509. 2 3 of 5 [* 3] INDEX NO. 654371/2018 NYSCEF DOC. NO. 15 RECEIVED NYSCEF: 10/19/2018 5. Windsor is liable for and shall pay to Claimants the sum of $44,450.00 in accrued sanctions pursuant to the Panel's Orders issued during the course of this matter. The accrual of additional daily charges specified in the Panel's Orders is terminated. 6. Windsor is liable for and shall pay to Claimants the sum of $425.00 as reimbursement for the non-refundable portion of Claimants' filing fee. On or about June 4, 2018, FINRA Department of Enforcement expelled Respondent from the financial industry for failing to satisfy an arbitration award. Dept. ofEnforcement v. Windsor Street Capital, LP, Docket No. 2018058118001 Applicable Standard "It is well settled that judicial review of arbitration awards is extremely limited." Wien & Malkin LLP v. Helmsley-Spear, Inc., 6 N.Y.3d 471, 479 (2006). "An arbitration award must be upheld when the arbitrator 'offers even a barely colorable justification for the outcome reached."' Wien, 6 N.Y.3d at 470-480 (internal citations omitted). CPLR §7510 states, "The court shall confirm an award upon application of a party made within one year after its delivery to him, unless the award is vacated or modified upon a ground specified in section 7511." CPLR §7511 provides four grounds on which an application to confirm an arbitration award may be denied: fraud; partiality by the arbitrator; the arbitrator exceeding his or her authority; and a failure to follow the procedures of CPLR Article 75. Discussion Petitioners' Verified Petition, dated September 10, 2018, is timely because the application was made within one year after the delivery of the Award, dated August 13, 2018. Furthermore, Respondent does not oppose Petitioners' application to confirm the Award, and therefore there are no facts alleged that fall within the four grounds set forth in CPLR 7511. Accordingly, the Petition to confirm the A ward is granted without opposition. 3 4 of 5 [* 4] INDEX NO. 654371/2018 NYSCEF DOC. NO. 15 RECEIVED NYSCEF: 10/19/2018 Wherefore, it is hereby ORDERED that the Petition to confirm the Award, dated April 13, 2018, entered upon the conclusion of an arbitration before FINRA between the Petitioners and Respondent, captioned Patrick Shea and Mary Shea v. Windsor Street Capital, LP, et al., FINRA Case No. 17-00360, is granted without opposition; and it is further ORDERED and ADJUDGED that petitioners Patrick Shea and Mary Shea have judgment and recover against respondent Windsor Street Capital, L.P., the following sums: (1) the sum of $1,380,804.00 in compensatory damages plus interest at the rate of 5% per annum, from and including the date of service of the Award, through and including the date the Award is paid in full; (3) $3,000,000.00 in punitive damages pursuant to Wis. Stats.§ 895.043 and Mastrobuono v. Shearson Lehman Hutton, Inc., 514 U.S. 52 (1995); (4) the sum of$552,321.60 in attorneys' fees pursuant to Wis. Stats.§ 551.509; (5) the sum of $44,450.00 in accrued sanctions pursuant to the Panel's Orders issued during the course of the matter (The accrual of additional daily charges specified in the Panel's Orders is terminated.); and (6) the sum of $425.00 as reimbursement for the non-refundable portion of Petitioners' filing fee, together with costs and disbursements in the as taxed by the Clerk, for the total amount of$_ _, and that amount of$ the petitioner have execution therefor. This constitutes the Decision and Order of the Court. All other relief requested is denied. Dated: October {ff, 2018 Eileen A. Rakower, J.S.C. 4 5 of 5

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