Source: http://openjurist.org/94/f3d/1103
Timestamp: 2015-01-31 04:10:00
Document Index: 541490564

Matched Legal Cases: ['§ 10', '§ 1962', '§ 1962', '§ 10', '§ 10', '§ 10']

94 F3d 1103 Minor v. Prudential Securities Inc | OpenJurist
94 F. 3d 1103 - Minor v. Prudential Securities Inc	Home94 f3d 1103 minor v. prudential securities inc
94 F3d 1103 Minor v. Prudential Securities Inc 94 F.3d 1103
RICO Bus.Disp.Guide 9113
Jo MINOR, Plaintiff-Appellant,v.PRUDENTIAL SECURITIES, INC. and Patrice Mackie, Defendants-Appellees.
No. 96-1180.
Henry F. Field, Chicago, IL, for Plaintiff-Appellant.
Theodore J. Low, Darren B. Watts, Robert P. Bramnik, Susan J. Magar, William F. Tueting, Altheimer & Gray, Chicago, IL, for Defendants-Appellees.
Plaintiff, Jo Minor, filed a motion in district court to vacate an arbitration decision pursuant to the Federal Arbitration Act ("FAA"), 9 U.S.C. § 10. The arbitrator had ruled in favor of defendants, Prudential Securities and broker Patrice Mackie (collectively "Prudential") on Minor's various claims arising from a series of stock investments. The district court dismissed her motion to vacate for lack of subject matter jurisdiction. We affirm.
In November of 1991, Prudential made a series of stock investments for Minor. Minor claims that Prudential misrepresented to her that certain of these investments were "safe," when in reality they were very high risk. Minor also claims that while she was a Prudential customer, Prudential effected at least one unauthorized trade in her account and forged her signature on a customer agreement. Minor maintains that as a result of these acts, she lost $17,797.86. In order to recover her losses, Minor filed a claim in arbitration before the National Association of Securities Dealers, Inc. ("NASD"). Minor and Prudential were subject to a pre-dispute arbitration agreement, contained in Minor's securities account agreement with Prudential. Minor's complaint consisted of nine counts: 1) breach of fiduciary relations; 2) breach of contract; 3) fraud; 4) constructive fraud; 5) lack of due care in performing a contract; 6) a violation of the Illinois Securities Act; 7) a violation of the Securities Act of 1934; 8) use of racketeering income to operate an enterprise, in violation of 18 U.S.C. § 1962(a); and 9) indirect participation in the conduct of a racketeering enterprise's affairs, in violation of 18 U.S.C. § 1962(c).
Arbitration hearings were held in December of 1994 and January of 1995. In the midst of the proceedings, a discovery dispute arose concerning one of Prudential's handwriting experts. Minor alleged that Prudential was attempting to conceal a negative report by switching their handwriting expert one day prior to the hearing. The Chairman of the Arbitration Panel held a conference on the issue and determined that Minor was entitled to a copy of the previous expert's report, but not to all of the materials surrounding the hiring of the two experts, as Minor had requested. At the conclusion of the hearing, the Arbitration Panel first found that Minor had withdrawn her RICO claims and then entered an award denying each of Minor's remaining claims. Displeased with the decision, Minor requested a statement of reasons from the Panel. On April 18, 1995, the Panel provided Minor with such a statement.
Minor then proceeded to file her "Motion to Vacate Arbitration Award" in the district court, pursuant to § 10 of the FAA. 9 U.S.C. § 10. In her motion, Minor claims that the arbitration award should be vacated because 1) it was procured by "corruption, fraud, or undue means," 2) the panel refused to hear evidence pertinent and material to the controversy, 3) there was "evident partiality" in the panel, and 4) the award was imperfectly executed because the panel wrongly stated that she had withdrawn her RICO counts. The district court dismissed the motion, finding a lack of subject matter jurisdiction, as the parties are not diverse and the motion to vacate presents no federal question.
It is now well established that § 10 of the FAA does not constitute a grant of subject matter jurisdiction.1 There must be an independent basis of federal jurisdiction before a district court can entertain a motion to vacate under that section. See Garr