Can victims outside the United States sue for investment losses?

Florida Securities Claim Attorney

The answer depends on whether the case is brought before the Financial Industry Regulatory Authority (FINRA) arbitration forum or in court.  

Florida Securities Claim Attorney  

If the customer’s claims will be brought against a securities brokerage firm based in the United States, the customer may sue in the FINRA arbitration forum.  Likewise, if the violations of the law were by a broker of a brokerage firm within the United States, the customer typically may sue the broker or the brokerage firm in the United States before the FINRA arbitration forum.  Sometimes the arbitration case will be administered in the United States with the arbitration hearing occurring in the foreign country, if FINRA conducts arbitrations in that specific country.

The rules governing where a victim may litigate a case may differ, however, if the action must be brought in court, i.e., there is no arbitration agreement between the investor and the brokerage firm.  Both federal and state courts in the United States have rules regarding personal jurisdiction over a defendant.  For example, a customer’s claim may be subject to dismissal for lack of personal jurisdiction if the cause of action occurred outside of the United States or the defendant lacks “minimum contacts” within the United States.  

Likewise, both federal and state courts have the discretion to dismiss a claim under the doctrine of forum non-conveniens, if a foreign court would be more convenient for the parties to litigate a case or if there is a stronger nexus, including witness availability, between the foreign country and the customer’s claims.

Please Note:  McCabe Rabin, P.A. provides these FAQ’s for informational purposes only, and you should not interpret this information as legal advice.  If you want advice as to how the law might apply to the specific facts and circumstances of your case, please contact one of our attorneys.

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