A legal battle between disgruntled Arizona investors and the former Olde Discount Corp. is headed to court. A jury trial is set to begin Wednesday involving a class action on behalf of investors who are suing to recover losses from some high-risk stocks in the 1990s. It would be the first such jury trial involving investor complaints with the former Olde. As many as 1,650 customers who had dealings with Olde's Arizona branches would be involved.
Regulators say that problems associated with past practices appear corrected.
The Arizona case goes back to trades made under the Olde ownership from April 1993 to February 1997. In the fall of 1998, federal regulators took action against Olde and three top executives, including Ernest J. Olde, the founder and former president. The firm and executives did not admit wrongdoing. The picture painted in a Securities and Exchange Commission report was startling. Richard Himelrick, the Phoenix attorney heading the class action, said most investors would have had no way of knowing about their broker's incentive to sell a given stock.