Originally from Dispute Resolution Journal

Investors and others involved in the securities industry will likely remember 1987 for two events: the United States Supreme Court decision in Shearson!American Express v. McMahon in june and "Black Monday" in October. Shortly after the Court's decision, which validated the use of arbitration to resolve customer-broker disputes arising out of the Securities Exchange Act of 1934, the American Arbitration Association promulgated Securities Arbitration Rules.

This article examines the new rules, highlighting how they differ from the AAA's Commercial Arbitration Rules and the rules of arbi tration systems operated by the securities industry. The background leading up to the Supreme Court's decision in the McMahon case is analyzed, and a study is made on the impact on case filings of both McMahon and "Black Monday."