Securities Litigation Lawyers – Bakhtiari & Harrison

Securities litigation — what it is and when it applies

Securities litigation refers to the pursuit of investor claims in state and federal court rather than through FINRA arbitration. While most investor disputes against broker-dealers are resolved through FINRA arbitration — because brokerage account agreements almost universally contain pre-dispute arbitration clauses — certain securities claims must be or are better pursued through court litigation.

Situations where court litigation is appropriate or necessary include: claims against parties who are not FINRA members (such as unregistered investment advisers, hedge fund managers, and corporate issuers); claims where the arbitration clause is unenforceable; class action securities fraud cases; cases involving parallel regulatory proceedings; and situations where injunctive relief is needed immediately — something FINRA arbitration cannot provide.

Securities litigation vs. FINRA arbitration — knowing which path to take

• Use FINRA arbitration when: your claim is against a FINRA-registered broker or brokerage firm, you have signed a brokerage account agreement with an arbitration clause, your damages are primarily monetary, and you want a faster and more confidential proceeding than court litigation can provide.
• Use court litigation when: your claim is against a party who is not FINRA-registered, you have grounds to challenge the enforceability of the arbitration clause, you need injunctive relief, your claim is most efficiently pursued as a class action with other investors, or your case involves parallel SEC or FINRA regulatory proceedings.
• Both paths may be available: in some circumstances, investors can pursue parallel proceedings — FINRA arbitration against the selling broker and court litigation against the issuer or unregistered party. Bakhtiari & Harrison evaluates the optimal path for each client’s specific circumstances before recommending a strategy.

For FINRA arbitration specifically, visit the Securities Arbitration page.

Types of securities litigation the firm handles

Individual securities fraud litigation

Bakhtiari & Harrison represents individual investors in securities fraud cases in California state court under the Corporate Securities Law of 1968 and in federal court under Section 10(b) of the Securities Exchange Act of 1934 and SEC Rule 10b-5. Individual securities fraud litigation is most appropriate for investors with significant individual losses where the specific facts of their case differ materially from other investors — making class action participation less advantageous than individual court action.

Class action securities litigation

The firm has served as lead class action counsel in both federal and state court securities class actions. Class action litigation is most appropriate when a large number of investors suffered similar losses from the same fraudulent conduct — typically in connection with a public company’s misrepresentations in its securities filings, earnings releases, or public statements. For more detail on the class action practice visit the Class Actions page.

Cases against unregistered investment advisers and hedge funds

Investment advisers who manage separately managed accounts or hedge funds for high-net-worth and institutional investors are frequently not FINRA members — meaning FINRA arbitration is unavailable. Claims against these parties must be pursued in court. Bakhtiari & Harrison represents investors in securities litigation against unregistered investment advisers, hedge fund managers, and other non-FINRA-registered parties whose misconduct has caused investor losses.

Issuer and underwriter liability

When a public company or its underwriters make material misstatements or omissions in connection with a public offering, investors who purchased securities in reliance on those statements may have claims under Sections 11 and 12 of the Securities Act of 1933 — strict liability provisions that do not require proof of intent. Bakhtiari & Harrison represents investors in issuer and underwriter liability cases in federal court.

Injunctive relief and asset freezes

When an investor faces immediate and irreparable harm — such as an ongoing Ponzi scheme draining assets, or a fraudster attempting to transfer or hide funds — court litigation is the only path to emergency injunctive relief and asset freezes. FINRA arbitration cannot provide emergency injunctive relief. Bakhtiari & Harrison has experience obtaining temporary restraining orders and preliminary injunctions in securities fraud cases where speed is critical.

California securities law — additional litigation advantages

California investors have access to the Corporate Securities Law of 1968 — California’s Blue Sky laws — in addition to federal securities law. California Corporations Code § 25401 imposes liability without requiring proof of scienter (intent to deceive), which is required under federal Rule 10b-5. California law also provides a rescission remedy under § 25501, allowing investors to recover their original investment plus interest. These California-specific advantages are available in California state court and can be asserted alongside federal claims in federal court where California law applies.

Why choose Bakhtiari & Harrison for securities litigation

• $250 million+ recovered. Four decades of results for investors in FINRA arbitration, state court, and federal court.
• Federal court admissions. Ryan Bakhtiari is admitted in the Central, Northern, Eastern, and Southern Districts of California, the Southern District of New York, the District of Colorado, and the Fifth and Ninth Circuit Courts of Appeal — covering the federal courts most commonly used for securities litigation.
• Trial experience. David Harrison’s background as a New York City assistant district attorney gives the firm genuine trial experience that purely transactional securities attorneys lack.
• Class action leadership. The firm has served as lead class action counsel in federal and state court securities class actions on behalf of investor classes.
• Contingency fee representation. No recovery, no fee. Initial consultations are free.

Frequently asked questions — securities litigation

When does a securities fraud case go to court rather than FINRA arbitration?

A securities fraud case goes to court rather than FINRA arbitration when the defendant is not a FINRA member, when the arbitration clause is unenforceable, when the investor needs injunctive relief, when the case is most efficiently pursued as a class action, or when the investor has grounds to challenge the arbitration agreement. Bakhtiari & Harrison evaluates the appropriate forum for each case at the initial consultation.

Can I pursue both FINRA arbitration and court litigation simultaneously?

In some circumstances yes — for example, pursuing FINRA arbitration against the selling broker-dealer while pursuing court litigation against the unregistered issuer of a failed private placement. The specifics depend on the parties involved, the claims asserted, and the applicable procedural rules. Bakhtiari & Harrison evaluates parallel proceeding strategy as part of its initial case assessment.

What is the statute of limitations for securities fraud in federal court?

Federal securities fraud claims under Section 10(b) and Rule 10b-5 must be filed within two years of discovery of the facts constituting the violation, and no later than five years after the violation occurred. Claims under Sections 11 and 12 of the Securities Act of 1933 have a one-year discovery period and three-year repose period. California state law claims have different periods — in some cases more favorable. Contact Bakhtiari & Harrison promptly — these deadlines are strictly enforced.

Does Bakhtiari & Harrison handle securities litigation outside California?

Yes. The firm represents investors in securities litigation in state and federal courts throughout the United States. Ryan Bakhtiari is admitted in multiple federal districts and circuit courts. For California-specific state court litigation, the firm’s deep knowledge of the Corporate Securities Law of 1968 is a particular advantage.

Contact a securities litigation lawyer — free consultation

Contact Bakhtiari & Harrison for a free, confidential consultation. Our FINRA attorneys review every potential case at no charge.

Investor cases are handled on a contingency fee basis — no recovery, no fee.

Call: (800) 382-7969 | Contact Us