Tedeschi v. Smith Barney, Harris Upham & Co., Inc.

OPINION

EDWARD WEINFELD, District Judge.

This action was the aftermath of an arbitration proceeding, the parties to which were Anthony W. Tedeschi (“Tedeschi”), a registered broker, and his former employer, Smith Barney, Harris Upham & Co., Inc., an investment broker. The basic issue submitted to the arbitrators was whether Tedeschi, as the account executive servicing the account of a customer knew or should have known, and failed to report, that the latter (“the defalcating customer”) had received stock to which he was not entitled. Smith Barney sought recovery from Tedeschi for the loss…