Titan/Value Equities Grp., Inc. v. Superior Court of San Diego Cty.

Factual and Procedural Background

In 1990, David Balestrieri and Michael Keenan (collectively investors) opened securities accounts with Titan/Value Equities Group, Inc. (Titan). At the time of opening the accounts, they signed forms agreeing to submit any dispute to arbitration before the National Association of Securities Dealers (NASD). In 1992, however, the investors filed suit against Titan, two Titan employees, AIMCO, Patrick Payne (Payne), and Payne’s wife, Elizabeth Kincannon (Kincannon), among others in superior court for alleged losses they suffered in connection with the trading.

Titan responded by filing a petition to compel arbitration on behalf of the Titan defendants, and the investors in turn submitted their claims against Titan to arbitration. The court accordingly denied the petition as moot in light of the investors’ stipulation to arbitrate and submission of claims to arbitration, and stayed the superior court action as to Titan in December 1992. The investors later signed and filed with NASD Uniform Submission Agreements which provide, inter alia, the parties “submit the . . . matter ... to arbitration in accordance with the . . . Code of…