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Actor Larry Hagman Wins $11,600,000 Securities Arbitration Award, Citigroup Seeks to Dismiss

Posted by: Robert Rex
December 08, 2010
Topic: Citigroup

Back in October of 2010, actor Larry Hagman of (of TV's "I Dream of Jeannie" and "Dallas") won an award in FINRA arbitration of $11.6 million. In May of 2009, Hagman had filed a claim alleging that Citi had committed breach of fiduciary duty, breach of contract, fraud by misrepresentation failure to supervise, and other offenses related to a purchase of unspecified securities and a life insurance policy. His accounts were with the Smith Barney brokerage, which was a part of Citigroup Global Markets until 2009 when the firm was sold to Morgan Stanley. The arbitration panel's reasoning for giving the award was not published, but they awarded Mr. Hagman $1.1 million in compensatory damages, $10 million in punitive damages, and $460,000 for legal fees and other costs.

This award is part of a recent trend in large arbitration awards we wrote about back in October, as the award was the largest given to an individual investor in 2010 and the 9th largest award ever.

Now however, a law firm acting on behalf of Citigroup has filed a motion to dismiss the award in Los Angeles Superior Court. Such motions are rarely successful, but Citi is alleging that one of the members of the arbitration panel failed to disclose a potential conflict of interest. The lead arbitrator on the case had sued his real estate investment partner for fraud and a breach of fiduciary duty two years earlier. According to the New York Times, a memo filed by Mr. Hagman's lawyers argues that this suit is unrelated to Mr. Hagman's case.

We will be watching with interest as this unfolds. If you wish to learn more about our securities arbitration practice, click here.

Click here to read Citigroup's petition.

"Messing With J.R., Take Four" - NYTimes Dealbook

"Actor Larry Hagman Wins $12 Million in Finra Case With Citigroup" - Bloomberg