17‐1819‐cv Pfeffer v. Wells Fargo Advisors, LLC et al.

UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT

SUMMARY ORDER

RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURTʹS LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH THE NOTATION ʺSUMMARY ORDERʺ). A PARTY CITING A SUMMARY ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.

At a stated term of the United States Court of Appeals for the Second Circuit, held at the Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of New York, on the 15th day of February, two thousand eighteen.

PRESENT: RALPH K. WINTER, GERARD E. LYNCH, DENNY CHIN, Circuit Judges.

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ALBA T. PFEFFER, Plaintiff‐Appellant,

v. 17‐1819‐cv

WELLS FARGO ADVISORS, LLC, ONE WELLS FARGO CENTER, 301 SOUTH COLLEGE STREET, CHARLOTTE, NC 28202, ANDRE MIRKINE, ONE WELLS FARGO CENTER, 301 SOUTH COLLEGE STREET, CHARLOTTE, NC 28202, Defendants‐Appellees,

FINANCIAL INDUSTRY REGULATORY AUTHORITY, INC., ARBITRATION PANEL,

ONE LIBERTY PLAZA, 165 BROADWAY, 27TH FLOOR, NEW YORK, NY 10006, Defendant.*

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FOR PLAINTIFF‐APPELLANT: Alba T. Pfeffer, pro se, Rye Brook, New York.

FOR DEFENDANT‐APPELLEE: Sandra D. Grannum, Drinker Biddle & Reath LLP, Florham Park, New Jersey.

Appeal from the United States District Court for the Southern District of

New York (Briccetti, J.).

UPON DUE CONSIDERATION, IT IS HEREBY ORDERED,

ADJUDGED, AND DECREED that the judgment of the district court is AFFIRMED.

Pro se plaintiff‐appellant Alba T. Pfeffer (ʺMrs. Pfefferʺ) appeals the district

courtʹs May 24, 2017 judgment, entered pursuant to its May 23, 2017 opinion and order,

denying her motion to vacate an arbitration award, dismissing her complaint, and

granting the motion to confirm the award by defendants‐appellees Wells Fargo

Advisors, LLC (ʺWells Fargoʺ) and its financial advisor Andre Mirkine. A three‐

member Financial Industry Regulatory Authority (ʺFINRAʺ) arbitration panel (the

ʺPanelʺ) dismissed Mrs. Pfefferʹs state law claims arising from defendantsʹ failure to

follow her late husbandʹs instructions to transfer all assets from a trust naming his

children as beneficiaries (ʺchildrenʹs trustʺ) to a trust naming her as the beneficiary

* The Clerk of Court is respectfully directed to amend the official caption to conform to the above.

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(ʺplaintiffʹs trustʺ). We assume the partiesʹ familiarity with the underlying facts, the

procedural history of the case, and the issues on appeal.

In 2004, Mrs. Pfefferʹs late husband, Murray Pfeffer (ʺMr. Pfefferʺ), created

two revocable trusts ‐‐ the childrenʹs trust and plaintiffʹs trust. Mirkine was the Pfeffersʹ

financial advisor, and Wells Fargo maintained both trusts and other personal accounts

for the Pfeffers.

In January 2010, Mr. Pfeffer requested by phone and by letter that Mirkine

transfer all assets from the childrenʹs trust (totaling about $665,000) to plaintiffʹs trust.

At the arbitration hearing, Mrs. Pfeffer explained that her husband requested the

transfer because the Pfeffers became concerned about Mirkineʹs management of the

accounts. Mirkine explained that he did not transfer the assets because he became

concerned following conversations with Mr. Pfeffer and Mr. Pfefferʹs son that Mr.

Pfeffer was not competent and was being unduly influenced by Mrs. Pfeffer. After

receiving two letters from physicians opining that Mr. Pfeffer was not capable of

making financial decisions, Wells Fargo froze both trusts.

In August 2010, following a guardianship proceeding commenced by Mr.

Pfefferʹs children, the New York State Supreme Court, Westchester County, appointed

Mrs. Pfeffer as the guardian of Mr. Pfefferʹs ʺpersonʺ and an independent guardian for

Mr. Pfefferʹs property. After Mr. Pfeffer died in October 2012, the independent

guardian distributed the proceeds of each trust to their respective beneficiaries.

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On February 2, 2015, Mrs. Pfeffer filed a statement of arbitration claim

with FINRA alleging breach of fiduciary duty, breach of contract, negligent

misrepresentation, and conversion based on defendantsʹ failure to follow Mr. Pfefferʹs

January 2010 instructions to transfer the assets from the childrenʹs trust to plaintiffʹs

trust. On September 30, 2016, following a five‐and‐a‐half day hearing during which

both parties presented testimony and other evidence, the Panel denied Mrs. Pfefferʹs

claim.

On October 25, 2016, Mrs. Pfeffer filed a complaint challenging the

arbitration award, which the district court construed as a motion to vacate the award.

On November 21, 2016, defendants moved to dismiss the complaint and confirm the

award. The district court confirmed the award and this appeal followed.

On appeal, Mrs. Pfeffer argues that the award was procured by undue

means, evident partiality, and misconduct because the Panel was intimidated by

defense counsel and refused to consider relevant evidence. She alleges that the Panel

exhibited manifest disregard for the law and facts.

When reviewing a district courtʹs decision to confirm or vacate an

arbitration award, we review questions of law de novo and findings of fact for clear

error. Kolel Beth Yechiel Mechil of Tartikov, Inc. v. YLL Irrevocable Tr.,

(2d

Cir. 2013). Under the Federal Arbitration Act, a district court may vacate an arbitration

award if: (1) the award was procured by ʺcorruption, fraud, or undue meansʺ; (2) the

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arbitrators exhibited ʺevident partialityʺ or ʺcorruptionʺ; (3) the arbitrators were guilty

of ʺmisconductʺ such as ʺrefusing to hear evidence pertinent and material to the

controversyʺ or ʺany other misbehaviorʺ that prejudiced the rights of any party; or

(4) the arbitrators ʺexceeded their powers.ʺ

(a); see also AT&T Mobility LLC

v. Concepcion,

, 350 (2011). This Circuit does not recognize manifest

disregard of the evidence as a proper ground for vacating an arbitration panelʹs award,

and will only find a manifest disregard for the law where there is no colorable

justification for a panelʹs conclusion. Wallace v. Buttar,

(2d Cir. 2004).

ʺ[T]he burden of proof necessary to avoid confirmation of an arbitration award is very

high, and a district court will enforce the award as long as ʹthere is a barely colorable

justification for the outcome reached.ʹʺ Kolel Beth Yechiel Mechil of Tartikov, 729 F.3d at

103–04 (citation omitted).

Upon review, we find no error in the district courtʹs confirmation of the

arbitration award. Mrs. Pfeffer failed to meet her ʺvery highʺ burden to demonstrate

that vacatur was appropriate. Id. at 103. The transcript of the arbitration reveals no

suggestion that the award was produced by undue means, evident partiality, or

misconduct. Her allegations that the Panel failed to abate defense counselʹs abrasive

manner and that it was intimidated by him are belied by the record. Contrary to Mrs.

Pfefferʹs allegations, the transcript of the proceedings shows that the Panel considered

her evidence, understood the issues underlying her claims, and afforded her latitude

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because she was proceeding pro se. Furthermore, Mrs. Pfeffer has shown nothing to

indicate that the Panel manifestly disregarded the law in coming to its conclusion.

We have considered Mrs. Pfefferʹs remaining arguments and find them to

be without merit. Accordingly, we AFFIRM the judgment of the district court.

FOR THE COURT: Catherine OʹHagan Wolfe, Clerk

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