Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

MARCUS v. MASUCCI

October 31, 2000

STEVEN MARCUS, PLAINTIFF,
V.
SAMUEL MASUCCI AND BEAR, STEARNS & CO., INC., DEFENDANTS.



The opinion of the court was delivered by: Robert W. Sweet, Judge.

OPINION

Defendants Samuel Masucci ("Masucci") and Bear Stearns & Co., Inc. ("Bear Stearns") (collectively, the "Defendants") have moved to compel plaintiff Steven Marcus ("Marcus") to arbitrate this dispute and dismissing or, alternatively, staying this action pending arbitration pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure and the Federal Arbitration Act ("FAA"), 9 U.S.C. § 1 et seq., and the By-laws of the National Association of Securities Dealers Inc. ("NASD"). For the reasons set forth below, the motion will be granted, arbitration is compelled, and this action is dismissed with leave granted to reopen if necessary upon completion of the arbitration.

The Parties

Marcus is employed by Chase Securities, Inc. ("Chase Securities"). Bear Stearns is a registered broker-dealer of securities.

Masucci is employed by Bear Stearns as a Managing Director.

Prior Proceedings

This action was commenced on May 8, 2000 by Marcus by the filing of a complaint alleging fifteen causes of action against the Defendants arising out of their use of an investment product called Shared Application Mortgage Securities ("SAMS"), including misappropriation of trade secrets, unfair competition, and unjust enrichment. Marcus seeks damages, the imposition of a construction trust and an accounting.

The instant motion was filed on July 10, 2000, and submissions were received through August 12, 2000, at which time the matter was deemed fully submitted.

Facts

For the purposes of a motion to dismiss, the factual allegations of the complaint are taken as true, though it is appropriate when considering jurisdictional issues to consider matters outside the parameters of the pleadings. See Cargill Intern. S.A. v. M/T Pavel Dybenko, 991 F.2d 1012, 1019 (2d Cir. 1993); Kamen v. A.T. & T. Co., 791 F.2d 1006, 1011 (2d Cir. 1986); Exchange Nat. Bank of Chicago v. Touche Ross & Co., 544 F.2d 1126, 1130-31 (2d Cir. 1976), modified on other grounds by Chemical Bank v. Arthur Andersen & Co., 726 F.2d 930 (2d Cir. 1981).

According to the complaint, Marcus and Masucci were previously employed at SBC Warburg Pincus Dillon Read ("Warbury Pincus") where they worked on the development of SAMS. Warburg Pincus abandoned the project in October 1998, terminated Marcus and Masucci, and granted them a release concerning the SAMS materials.

According to Marcus, he and Masucci then formed a joint venture to develop and promote SAMS.

The complaint further alleges that from November 1998 until March 1999, Marcus and Masucci sought to interest investment firms in the project. Bear Stearns was one of these firms. Bear Stearns negotiated with both Masucci and Marcus. In April 1999, Bear Stearns hired Masucci as a managing director. Marcus was not hired and remained unemployed until April 10, 2000, when he was hired by Chase Securities.

Chase Securities is a member of the NASD and Marcus is a NASD-registered employee of Chase Securities. The Defendants allege without contradiction by Marcus that in order to become a registered employee of Chase Securities, Marcus would have been required to sign a "Form U-4 Uniform Application For Securities Industry Registration or Transfer" ("Form U-4"). Form U-4 provides that the registered employee agrees:

to arbitrate any dispute, claim or controversy that may arise between [the employee and his] firm, or a customer, or any other person, that is required to be arbitrated under the rules, constitutions, or ...

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.