Washington Jury Instruction - 4.4.3 Rule 10(b) - 5(c) Fraudulent Practice or Course of Dealing Stockbroker Churning - Violation of Blue Sky Law and Breach of Fiduciary Duty

• Category: Federal - Jury Instructions
• State: Multi-State
• Control #: US-11CF-4-4-3
• Format: Word; Rich Text

Description

This form contains sample jury instructions, to be used across the United States. These questions are to be used only as a model, and should be altered to more perfectly fit your own cause of action needs. Washington Jury Instruction — 4.4.3 Rule 10(b— - 5(c) Fraudulent Practice or Course of Dealing Stockbroker Churning — Violation of Blue Sky Law and Breach of Fiduciary Duty The Washington Jury Instruction — 4.4.3, Rule 10(b— - 5(c) addresses the fraudulent practices or course of dealing conducted by stockbrokers known as churning, which is a violation of both the Blue Sky Law and the fiduciary duty owed to investors. Churning refers to the unethical practice of excessive trading or frequent buying and selling of securities in a customer's account by a stockbroker. This practice is typically employed to generate more commissions for the broker, rather than for the benefit of the investor. Such conduct not only violates the securities regulations under Rule 10(b) and 5(c) but also breaches the fiduciary duty owed by the stockbroker to the investor. Under this Washington Jury Instruction, the court highlights the importance of protecting investors from fraudulent practices like churning. These instructions are relevant in cases where investors have suffered financial losses due to a stockbroker's excessive trading and deceptive conduct. The instruction aims to educate the jury about the specific elements that need to be proven for establishing a claim of stockbroker churning. It emphasizes that the stockbroker engaged in a fraudulent course of dealing by excessively trading the investor's account, resulting in financial harm to the investor. Additionally, it underscores the need to establish the violation of the Blue Sky Law, which regulates the sale of securities in Washington State, as well as the breach of fiduciary duty owed by the stockbroker. Different types or variations of this instruction may include additional components depending on the specific circumstances of the case, such as: 1. Suitability Requirement: In certain cases, it may be necessary to establish that the stockbroker also failed to meet the suitability requirement. This requirement refers to the obligation of the stockbroker to recommend investments that are suitable for the investor's financial situation, objectives, and risk tolerance. 2. Breach of Duty to Disclose: In instances where the stockbroker failed to disclose material information regarding the risks associated with the recommended trades or potential conflicts of interest, an additional claim of breach of duty to disclose may be included. 3. Civil Liability and Remedies: The instruction may encompass a section explaining the potential civil liabilities and remedies available to the claimant in case the jury finds the stockbroker liable for churning, Blue Sky Law violation, or breach of fiduciary duty. Such remedies may include damages, restitution, disgorgement of ill-gotten gains, and attorney's fees. It is important to note that the terminology and specific components may vary depending on the jurisdiction and the details of the case. The Washington Jury Instruction — 4.4.3, Rule 10(b— - 5(c) provides a framework for guiding the jury's understanding of the claims brought against a stockbroker accused of churning while violating the Blue Sky Law and breaching fiduciary duty.

Washington Jury Instruction — 4.4.3 Rule 10(b— - 5(c) Fraudulent Practice or Course of Dealing Stockbroker Churning — Violation of Blue Sky Law and Breach of Fiduciary Duty The Washington Jury Instruction — 4.4.3, Rule 10(b— - 5(c) addresses the fraudulent practices or course of dealing conducted by stockbrokers known as churning, which is a violation of both the Blue Sky Law and the fiduciary duty owed to investors. Churning refers to the unethical practice of excessive trading or frequent buying and selling of securities in a customer's account by a stockbroker. This practice is typically employed to generate more commissions for the broker, rather than for the benefit of the investor. Such conduct not only violates the securities regulations under Rule 10(b) and 5(c) but also breaches the fiduciary duty owed by the stockbroker to the investor. Under this Washington Jury Instruction, the court highlights the importance of protecting investors from fraudulent practices like churning. These instructions are relevant in cases where investors have suffered financial losses due to a stockbroker's excessive trading and deceptive conduct. The instruction aims to educate the jury about the specific elements that need to be proven for establishing a claim of stockbroker churning. It emphasizes that the stockbroker engaged in a fraudulent course of dealing by excessively trading the investor's account, resulting in financial harm to the investor. Additionally, it underscores the need to establish the violation of the Blue Sky Law, which regulates the sale of securities in Washington State, as well as the breach of fiduciary duty owed by the stockbroker. Different types or variations of this instruction may include additional components depending on the specific circumstances of the case, such as: 1. Suitability Requirement: In certain cases, it may be necessary to establish that the stockbroker also failed to meet the suitability requirement. This requirement refers to the obligation of the stockbroker to recommend investments that are suitable for the investor's financial situation, objectives, and risk tolerance. 2. Breach of Duty to Disclose: In instances where the stockbroker failed to disclose material information regarding the risks associated with the recommended trades or potential conflicts of interest, an additional claim of breach of duty to disclose may be included. 3. Civil Liability and Remedies: The instruction may encompass a section explaining the potential civil liabilities and remedies available to the claimant in case the jury finds the stockbroker liable for churning, Blue Sky Law violation, or breach of fiduciary duty. Such remedies may include damages, restitution, disgorgement of ill-gotten gains, and attorney's fees. It is important to note that the terminology and specific components may vary depending on the jurisdiction and the details of the case. The Washington Jury Instruction — 4.4.3, Rule 10(b— - 5(c) provides a framework for guiding the jury's understanding of the claims brought against a stockbroker accused of churning while violating the Blue Sky Law and breaching fiduciary duty.