JPMorgan Chase & Co. is seeking to bolster its case as part of an effort to overturn an arbitration award that went in favor of a former broker, reports AdvisorHub.
In May, a panel of two public and one non-public Financial Industry Regulatory Authority arbitrators ordered JP Morgan to pay $4.25 million to Brent R. Bodner over his wrongful termination claim.
Bodner alleged that he had been unjustly terminated in June 2024 for billing the company for a $642.50 platter of sandwiches for a 2024 Super Bowl gathering at his home. J.P. Morgan claimed that he submitted an inaccurate reimbursement request for the platter and that he had misrepresented the personal event as client-related at a restaurant.
JPMorgan filed a motion in federal court in Los Angeles arguing that the arbitration award should be vacated. The firm contends the arbitrators exceeded their authority by awarding damages that were “wholly untethered to any evidence or testimony.” The bank contends the award showed “manifest disregard” of the law and the facts presented during the arbitration.
Recently JPMorgan filed a 3,500-word brief in in support of its original petition attempting to vacate the decision, after Bodner asked the court to confirm the award.
In the latest brief, JP Morgan contends the total damages awarded were “speculative” and part of a trend of what industry advocates criticize as “runaway” punitive damage awards by FINRA arbitrators.
“[A]rbitrators are not free to simply make up a damages number and call it a day,” JPMorgan’s lawyers wrote. “Compensatory damages ‘cannot be remote, contingent or speculative,’” they added, borrowing language from a prior court’s ruling. “[I]t’s anyone’s guess how the arbitrators here arrived at their damages figure.”
The firm also reiterated its position that the claim of wrongful termination was not supported by evidence. “There was nothing on the other side of the scale to counter the mountain of evidence” in its favor,” JPMorgan wrote.
Bodner sought $30 million in compensatory and punitive damages to “punish [J.P. Morgan] for its deliberately damaging actions and claims and to deter it and others from repeating this form of behavior in the future.”.
In addition to awarding Bodner the $4.25 million in damages, the FINRA arbitrators ruled he could expunge from his record the termination notice on his public record, which he alleged was defamatory. The reason for leaving J.P. Morgan was permitted to be changed to “voluntary.” When JP Morgan fired Bodner in 2024, the termination form included language alleging he violated its “Business Hospitality policy as it relates to the purpose and location of an event.”
Though the company alleged the platter was served at a personal Super Bowl party, Bodner claimed it was actually purchased for a “pre-approved business meeting” held at his home and that his assistant had sought approval for the food order in advance.
Bodner maintained that the key attendees had been pre-approved and that the inaccuracies were inadvertent.
In its new brief, JP Morgan disputed Bodner’s defamation and unlawful termination claims and argued that the expungement “flouted procedural requirements” because it was required by FINRA rules to disclose the reason for his termination.
“Indeed, firms ‘must provide sufficient detail when responding to Form U-5 questions’ and cannot ‘report only that a person’s registration was terminated because that person violated ‘firm policy,’” JPMorgan’s lawyers wrote, quoting language from FINRA’s rules.
“JPMS followed those dictates when it reported Bodner’s indisputably involuntary termination for dishonest conduct,” they added. “JPMS’s statements on Bodner’s U-5 thus benefit from an absolute privilege, and the arbitrators could not reasonably have concluded otherwise.”
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