The Clients’ Waiver of Their Rights Under Regulation BI of the Securities and Exchange Commission

TAMAR FRANKEL

BU Law emerita professor Tamar Frankel discusses the Securities and Exchange Commission (SEC)’s Regulation Best Interest (BI), which imposes on broker-dealers a commitment to act in the best interests of their clients. Specifically, Frankel addresses the SEC’s treatment of client waivers of the Regulation BI, which goes even further than general fiduciary law to prohibit any waiver of the broker-dealer’s conflicting interests.

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Martinez v. Cain

Docket: S066253

Opinion Date: February 21, 2020

Judge: Nelson

Areas of Law: Constitutional Law, Criminal Law

Petitioner Pedro Martinez was 'playing with’ a gun, and asked the victim for his wallet. The victim refused. Petitioner then asked the victim to get out of his car, and the victim refused that request, too, saying "you ain’t getting my wallet and you ain’t getting my car." Petitioner said, "Well, then I’m going to have to shoot you." As the victim tried to drive away, petitioner did just that: shooting the victim once in the arm. The victim testified that his car already was moving when petitioner fired; the victim believed it was possible that the car bumped petitioner’s hand, causing him to lose some control of the gun when he pulled the trigger. The victim drove the short distance to his home and called 9-1-1. He was transported to a hospital. A doctor who treated the victim testified that the bullet broke the victim’s arm and fragments traveled to his chest, coming within inches of multiple blood vessels. Petitioner was indicted on several counts, though the only counts relevant here charged petitioner with first-degree robbery and attempted aggravated felony murder. He sought post-conviction relief, contending that his counsel had been constitutionally inadequate by failing to argue that those crimes should be merged. The post-conviction court granted summary judgment against petitioner, concluding that he had not been prejudiced by his counsel’s failure to object, because as a matter of law the sentences would not merge. A majority of the Court of Appeals panel affirmed, On review, the presented to the Oregon Supreme Court was whether petitioner’s convictions should have been merged under ORS 161.067(1). The Court concluded they should have, reversed the trial and appellate courts, and remanded for further proceedings.

Oregon v. Iseli

Docket: S066142

Opinion Date: February 21, 2020

Judge: Garrett

Areas of Law: Constitutional Law, Criminal Law

This interlocutory appeal involves the “unavailability as a witness” requirement under Oregon Evidence Code (OEC) 804(1), for purposes of applying an exception to the hearsay rule in a criminal case. The State served a subpoena on a key witness to testify against defendant Chad Iseli and made other efforts to ensure her attendance at trial, but she did not attend. The State therefore moved to introduce her earlier out-of- court statements under the “forfeiture-by-wrongdoing” exception to the hearsay rule, OEC 804(3)(g). The trial court found that the State had made substantial efforts to secure the witness’s attendance and that she had expressed safety concerns about testifying. It also found, in relation to the forfeiture-by-wrongdoing exception, that defendant had engaged in intentional, wrongful conduct that had caused her absence. The court further determined, however, that the State had not established that the witness was unavailable because it had not sought a material witness warrant or a remedial contempt order. The court therefore denied the state’s motion to admit her earlier statements. The State appealed that ruling, and the Court of Appeals reversed, reasoning that, particularly in light of defendant’s intentional, wrongful conduct, the State had satisfied the “process or other reasonable means” requirement of OEC 804(1)(e), thereby establishing that the witness was unavailable. The Oregon Supreme Court reversed, finding that while the trial court was incorrect to view certain facts as categorically irrelevant to the “unavailability as a witness” determination under OEC 804(1)(e). "Ultimately, though, when we add those facts to the calculus, we again conclude that the trial court’s ultimate ruling - that the state did not satisfy the “other reasonable means” component and, therefore, did not establish that the victim was unavailable - was correct.

Eddy v. Anderson

Docket: S066301

Opinion Date: February 21, 2020

Judge: Garrett

Areas of Law: Landlord - Tenant

In this case, after defendants (tenants) were sued for collection of unpaid rent, they alleged a counterclaim for damages under ORS 90.360(2) on the ground that plaintiffs (landlords) had not maintained the premises in a habitable condition. The trial court dismissed that counterclaim, reasoning that tenants had failed to provide landlords with written notice of the alleged violation and had acted with “unclean hands.” The Court of Appeals affirmed on somewhat different grounds, concluding that, in light of the trial court’s findings, tenants had failed to act in good faith for purposes of ORS 90.130 and that their counterclaim was therefore barred. The Oregon Supreme Court reversed, finding that neither ORS 90.360(2) nor ORS 90.370 required written notice as a prerequisite for a tenant’s counterclaim under ORS 90.360(2). The trial court’s contrary view was erroneous. Moreover, the Supreme Court found the record from the hearing demonstrated that the trial court relied heavily on its erroneous understanding that written notice was required when it determined that tenants had not acted in good faith for purposes of ORS 90.130. Because it could not conclude that the trial court would have reached the same conclusion as to good faith even if it had correctly applied ORS 90.360(2), the matter was remanded to the trial court for further proceedings.