Well, the verdict is in. The judge in the Circuit Court of Cook County dismissed the case with prejudice on Wednesday, which means it cannot be re-filed. It’s final. And actually, it should not have even come to this. Alaron’s president Steve Greenberg agreed to a legally binding arbitration case with Penson, and separately with Penson’s general counsel Carl Gilmore in 2010 over the transfer of Alaron accounts held at Penson to Peregrine Financial Group (PFG) in 2009. The NFA rulings went in favor of Penson and Gilmore.
But that didn’t work for Greenberg. So he sued Hehmeyer in court alleging “negligent misrepresentation, fraudulent misrepresentation, intentional interference with contractual relationships between Alaron and its introducing brokers” and interference with the sale of Alaron’s customer business to PFG. The suit called for $4 million in damages and another $12 million in punitive damages.
After listening to arguments from both sides, Circuit Court judge Sanjay Tailor tossed out the case, essentially saying “This looks just like the legally binding arbitration you already lost.”
In the end, this was either simply one industry person suing another as is his right, or it was a frivolous lawsuit and a waste of time.
In a broader context, the futures industry is at a point when its leadership’s focus should be on restoring the trust of customers and growing volumes. Let’s not waste more time.