Since the COVID-19 pandemic began, FINRA Dispute Resolution Services (along with all other arbitration services providers) has had to wrangle with the difficult issue of what to do about arbitration hearings that are supposed to be in person. First, in mid-March when the country first shut down, FINRA administratively postponed all hearings until May 1 (with all other case-related deadlines remaining in place). Then, in late April, FINRA postponed hearings until July 3, unless the parties stipulated to proceed telephonically or by Zoom or the panel ordered hearings to take place telephonically or by Zoom. In late June, FINRA postponed again until Sept. 4; then in August until Oct. 30; most recently the postponement was extended until Dec. 4. I would not be at all surprised by further postponements into 2021.
At some point this year, FINRA added a table to its “Dispute Resolution Statistics” page, which identifies the number of cases subject to a contested motion for a virtual arbitration hearing (57, through the end of July, two-thirds of which were granted), and the number of cases proceeding to a virtual hearing on joint motion (32). So far, since the postponement of in-person hearings, and, as of July 31, FINRA arbitrators have conducted one or more hearings via Zoom in 32 cases (14 customer cases and 18 industry cases).” [As a matter of full disclosure, I was an arbitrator on an intra-industry FINRA panel which, in early March 2020 and on party consent, held the very last day of hearings, the closing statements, on Zoom.]
What does this mean for parties’ ability to get justice via FINRA arbitration? Can parties secure the same level of procedural justice on Zoom? These are questions worth examining when we have more data resulting from these virtual hearings. I believe it is too soon to assess the answers, which would be speculative now at best.
So stay tuned for future analysis!