Prior Successes

Our Successful Cases Include:

$3 Million+ Judgment in Breach of Contract Case. Mihalek Law represented a married couple from South Carolina in a breach of contract claim where we settled a securities complaint and later the defendant breached the written settlement agreement. The federal court granted summary judgment to our clients and awarded $3,073,180 including $963,141 in prejudgment interest.

$3 Million Settlement for Excessive Markups, Markdowns and Churning. Mihalek Law represented a community bank in New York in a FINRA arbitration brought against a regional broker-dealer. The allegations included churning, breach of fiduciary duty, and excessive markups and markdowns of our client’s $100 Million bond portfolio. After several years of investigation and litigation, we mediated the case and ultimately reached a $3 Million settlement for our institutional client

$1.5 Million Civil Judgment with Punitive Damages. Mihalek Law successfully tried a bench trial for breach of fiduciary duty and the unlawful offer and sale of unregistered bonds under the Kentucky Securities Act against a former local registered investment advisor (Richard “Hampton” Scurlock) and his company, Retirement Tax Advisory Group, Inc. and the Florida-based bond issuer and its principals. In addition to $500,000 of compensatory damages, the court ordered the issuer and its principals to pay $1 million punitive damages to our single client.

$800,000 One-of-a-Kind Class Action Settlement. Mihalek Law successfully represented 125 Kentucky victims involved in a fraudulent scheme to purchase stock which they owned for many years. The scheme involved a failure to fully and accurately disclose the financial condition of the company. All of the sellers sold their stock at a profit. The class action was certified in state court based on the Kentucky Securities Act. It is believed to be the first and only successful Kentucky Blue Sky Law class action which culminated in an $800,000 settlement.

$200,000 Settlement for Negligent Advice to Retiree. Mihalek Law represented a married couple from Louisville, Kentucky in an arbitration claim filed against a multi-national broker-dealer. The arbitration involved claims of negligent retirement advice and unsuitable, high-risk investments. The matter was settled after mediation for $200,000.

$285,000 Settlement for Unauthorized and unsuitable Options. Mihalek Law represented a married couple from Central Kentucky in an arbitration against a regional broker-dealer. The arbitration involved unauthorized options transactions resulting in about $225,000 of damages. After trying the case for two days, we negotiated a $285,000 settlement on behalf of our clients.

$565,000 Settlement for Unauthorized/Unsuitable Trading. Mihalek Law represented three clients in Texas and one in Nevada in four arbitration cases brought against a national investment bank and its former registered representative. Each case alleged unauthorized and unsuitable trading. After mediations in Dallas (2), Houston (1) and Las Vegas (1), we settled and recovered $565,000 on behalf of our clients.

$175,000 Settlement for Unsuitable Transactions. Mihalek Law represented a married couple from Nebraska in an arbitration against a multi-national investment bank. The claims involved unsuitable investments and misrepresentations and omissions of material facts brought under the Nebraska Securities Act. After litigating the claim for several months, we settled and recovered $175,000 on behalf of our clients.

Multi-Million Settlement in tax shelter scheme. Mihalek Law represented a married couple from South Carolina in a Civil RICO litigation in federal court case against a bank, its financial advisors and others, who recommended several fraudulent tax shelters that resulted in damages and tax penalties to our clients. After several years of litigation, the matter settled for many millions of dollars recovered from the investment bank, the issuer’s accountants and the asset protection attorneys who assisted in marketing the tax-sheltered investments.

$19.7 Million Arbitration Award. Mihalek Law was retained by a couple from Louisville, Kentucky who lost $2,700,000 in a fraudulent boiler room campaign conducted by an unscrupulous New York based broker-dealer and its sales force. We filed an arbitration claim requesting compensatory damages, attorneys’ fees, punitive damages and court costs, and after trying the case in Louisville, received a $19.7 arbitration award (including $15 Million in punitive damages), believed to be the largest NASD (nka FINRA) Award for a single retail account at that time. We were successful in proving that the investment banking firm was a boiler room which manipulated the price of the stock of five corporations for its own benefit. This case involved over a decade of litigating in arbitration and several proceedings involving trustees in various bankruptcy courts and Department of Justice Victims’ Funds.

$900,000 Debit Margin Award. Mihalek Law represented a wire house client from Eastern Kentucky who was sued by the firm to collect a debit balance exceeding $900,000 resulting from options trading in a margin account. At an arbitration hearing, we put on proof of the unprofessional activities of the registered representative resulting in a zero award for the wire house to recover on the debit balance.

$1.179 Million Bet the Farm (House) Cases. Mihalek Law brought arbitration cases against a national broker-dealer on behalf of four Kentucky and Ohio families who were advised to mortgage their previously debt-free home and invest the borrowed funds in the market. When the recommended investments plunged, our clients were in danger of losing their homes. We successfully negotiated nearly $1.2 Million in settlements for our clients.

$994,625 Early Retirement Cases. Mihalek Law represented 21 families from Central Kentucky who worked for the same telephone company that was offering early retirement packages. After attending seminars put on by a regional broker-dealer, our clients were advised and accepted the early retirement lump sum offers (and forego a guaranteed lifetime pension). The registered representative promised to take the lump sum amount and invest it in a safe way that would provide the retiree with more monthly income and also grow the portfolio for their children. Some of these cases were settled and others were arbitrated to awards, which together totaled just under $1 million.

$1.466 Million in Retiree Awards and Settlements. Mihalek Law arbitrated the claims of nine Western Kentucky families who were enticed to forego their guaranteed pension from a natural gas transmission company and invest their respective lump sums with a financial adviser with one of the nation’s largest broker-dealers. After the final arbitration hearing (but before the Award was issued) we negotiated a $1.2 Million settlement for seven of our clients. On one case which was not settled, we received an Award of over $266,000 for one family.

$3.26 Million Settlement for Retirement Variable Annuities. Mihalek Law represented 88 blue-collar retirees from Eastern Kentucky and West Virginia who were all sold the same poorly-performing, high commission and cost variable annuity, alleging misrepresentations and omissions of material facts. Though the variable annuity was purchased at one firm and later transferred to a second firm (a multi-national broker-dealer), we were able to negotiate cash settlements totaling $3.26 Million from the second firm for every one of our clients without initiating legal proceedings.

$750,000 Agreed Judgment in State Court. Mihalek Law represented the trustee of a trust against a registered investment advisor alleging violations of Kentucky’s Securities Act and common law due to overcharging of management fees. Our client alleged that he paid over $372,000 in management fees which were unearned by the investment professional since the accounts were not profitable. Soon after initiating a lawsuit in state court, we negotiated and $750,000 Agree Judgment in favor of our client which terminated the lawsuit.

$350,000 Settlement for Single Retiree. Mihalek Law represented a 69-year-old retiree from Louisville who was enticed to transfer her managed account away from one national investment bank to another to achieve “superior results”. Her blue-chip portfolio was sold off and replaced with high cost/commissioned proprietary funds and a variable annuity at the new firm. We alleged that her retirement funds were mismanaged and that the entire transaction was riddled with misrepresentations and omissions of material facts. After filing an arbitration, we successfully negotiated a $350,000 settlement for our client, despite the firm maintaining that her accounts had suffered no damages.

Terrible Tuesday Margin Liquidation. Mihalek Law represented a Kentucky doctor who during the 1987 market crash was called and told he must wire in about $150,000 before the opening bell (in less than an hour) or face a liquidation of his account. Living in a rural area, this was not possible and the regional broker-dealer sold off his entire account resulting in damages. We initiated AAA Arbitration alleging an unreasonable margin liquidation and our client was awarded compensatory damages, attorney’s fees and punitive damages against the broker-dealer.

Prudential Limited Partnerships. Mihalek Law represented dozens of clients in Kentucky and West Virginia in the mid 90’s who were sold Prudential Securities limited partnership interests in airplanes, real estate, and other underlying assets. The claims were based on alleged material misrepresentations and omissions of facts, including the risks and high costs associated with the products. We settled or received a favorable award on behalf of the dozens of investors we represented. For an excellent expose of the Prudential Limited Partnership debacle, read Kurt Eichenwald’s Serpent on the Rock.

$118,000 Settlement in Overconcentration Cases. Mihalek Law represented three Central Kentucky families whose financial advisor recommended that they invest a majority of their modest accounts in obscure and speculative oil & gas, silver, and gold exploration companies. We lodged written complaints with the broker’s employer – a national broker-dealer – and negotiated $118,000 of settlements for our clients without initiating legal proceedings.

$972,000 Ponzi Scheme/Broker Theft Cases. Mihalek Law represented several clients in cases against major wire houses and regional broker-dealers where its agents were operating a Ponzi scheme (raising money from new investors to pay off earlier ones), creating fictitious statements to conceal the scheme and oftentimes stealing the money. We have successfully recovered nearly one million dollars by settlement and in one substantial arbitration award – with interest and attorney’s fees – for the benefit of our defrauded Ponzi scheme clients.

$475,000 Elder Abuse/Theft Case. Mihalek Law represented an executor of the estate of a victim of elder abuse where the stockbroker “befriended” his elderly, infirmed client and enticed her to appoint him her Power of Attorney (POA). The broker/POA then proceeded to write “gift” checks to himself totaling hundreds of thousands of dollars. After initiating a lawsuit in state court and mediating before one of Kentucky’s leading jurists, we successfully negotiated a $475,000 cash settlement for the estate from the stockbroker’s employer, an international broker-dealer.

Proprietary Bond (Structured Products) Funds. Mihalek Law brought arbitrations on behalf of several families against a regional broker-dealer involving its structured products. The arbitrations involved allegations of misrepresentations and omissions of material facts and the unsuitability of the funds which contained derivatives and structured financial products, including collateralized mortgage obligations (CMO), credit default swaps (CDS), collateralized debt obligations (CDO) and other complicated alternative investments. We negotiated several substantial settlements and obtained an arbitration award on one claim that went through a final hearing of over $115,000 for our clients.

$929,000 100% Principal Protected Notes. Mihalek Law brought several claims for Central Kentucky investors who were sold Lehman Brothers 100% Principal Protected Notes by a multi-national investment bank/wire house. When Lehman filed for bankruptcy on September 15, 2008, the notes became worthless. After trying two cases in Arbitration, where we received awards totaling over $369,000 in compensatory damages and attorney’s fees (and in one case pre-judgment interest too), we negotiated substantial settlements for the benefit of our remaining clients.

$176,953 Arbitration Award against A.G. Edwards. Mihalek Law brought an arbitration claim on behalf of an single woman from Central Kentucky against A.G. Edwards and its registered representative. The claim involved unsuitable investments and unsuitable advice to retire. After a four-day hearing, the arbitration panel awarded our client, and we recovered, $176,953 in damages, attorney’s fees and costs, despite the firm’s claims that Claimant’s damages were only about $5,000.

$1 Million+ Arbitration Award. Mihalek Law brought an arbitration claim on behalf of a married couple against two individual investment advisors/registered representatives (after receiving a substantial settlement from their former employer) alleging fraud and material misrepresentations under the Kentucky Blue Sky (Securities) Act. After a final hearing, the arbitration panel awarded our clients $1,027,634 (including $271,090 in attorney’s fees and $200,000 in punitive damages) for the unlawful and fraudulent investment activities.

Clawback Cases. Mihalek Law represented several clients in actions brought by SEC-appointed and Bankruptcy Court-appointed Trustees. These actions involve claims where unsuspecting investors unwittingly received more money from than they invested into a Ponzi scheme or bankrupt entity – making them net “winners.” We have successfully negotiated settlements on behalf of all of our clawback case clients.

SEC/FINRA Enforcement Actions. Mihalek Law represented several registered representatives and investors in enforcement investigations and actions brought the United States Securities & Exchange Commissions (SEC) and FINRA, the primary regulator of broker-dealers and registered representatives, involving insider trading, unregistered stock sales, and fraud in connection with stock sales. We have successfully negotiated settlements on behalf of our regulatory enforcement clients.

$1.4 Million Non-Traded REIT Buyback/Settlement. Mihalek Law filed an arbitration claim on behalf of Ohio widow against a small broker-dealer headquartered in Georgia and its agent. The case involved the unsuitable purchases of several unregistered, non-traded REIT’s (Real Estate Investment Trusts) and deferred annuities. After negotiating $1,250,000 of buybacks/redemption with the issuers, we negotiated a $165,000 settlement against the broker-dealer and agent.

$1.55 Million Auction Rate Securities Settlement. Mihalek Law represented an Indiana corporation in an arbitration claim filed against a regional broker-dealer. The case involved a $1.5 Million investment in Jefferson County Alabama Sewer Auction Rate Securities (ARS), which paid our client interest for three years until the ARS market froze-up in mid-2008. We alleged violations of Indiana’s Securities Laws and common law. After litigating for over a year, we negotiated a $1,550,000 settlement on behalf of our client.

These are a sampling of the claims of hundreds of clients we have represented over the past three decades. Do you have a claim? Contact us, or call 859-233-1805

to speak with an experienced securities attorney.