RETURN DATE: SEPTEMBER10, 2024
`ASHLEY R. SCHEXNAILDRE,
`Plaintiff
`
`: SUPERIOR COURT
`:
`JUDICIAL DISTRICT OF
`: BRIDGEPORT
`
`VS.
`
`FINANCIAL INDUSTRY REGULATORY
`AUTHORITY,INC.,
`Defendant
`
`AUGUST6, 2024
`
`VERIFIED COMPLAINT
`
`1.
`
`Plaintiff Ashley R. Schexnaildre, FINRA CRD No. 6182170 (“Plaintiff”) is an
`
`individual residing at 68 Magnolia Road, Trumbull, Connecticut. At all material times, Mr.
`
`Schexnaildre has been a registered investment adviser representative with the Securities and
`
`Exchange Commission through his then-employer United Capital Financial Advisers, LLC
`
`(“United Capital’).
`
`2.
`
`Defendant Financial Industry Regulatory Authority, Inc. (“Defendant”or
`
`“FINRA”), is a self-regulatory organization registered with the Securities Exchange Commission
`
`as a national securities association authorized to regulate the U.S. securities markets and
`
`professionals whosell securities in the United States pursuant to the Securities Exchange Act of
`
`1934, 15 U.S.C. § 78a et seq. (the “Act’’).
`
`3.
`
`FINRA is obligated to “establish and maintain a system for collecting and
`
`retaining registration information” about registered representatives. See 15 U.S.C. § 780—
`
`3(i)(1)(A). “Registration information”is defined as “information reported in connection with the
`
`registration or licensing of brokers and dealers and their associated persons.” See 15 U.S.C. §
`
`780-3(i)(1)(A).
`
`
`ASHLEY R. SCHEXNAILDRE,
`Plaintiff
`
`: SUPERIOR COURT
`:
`JUDICIAL DISTRICT OF
`: BRIDGEPORT
`
`VS.
`
`FINANCIAL INDUSTRY REGULATORY
`AUTHORITY,INC.,
`Defendant
`
`AUGUST6, 2024
`
`VERIFIED COMPLAINT
`
`1.
`
`Plaintiff Ashley R. Schexnaildre, FINRA CRD No. 6182170 (“Plaintiff”) is an
`
`individual residing at 68 Magnolia Road, Trumbull, Connecticut. At all material times, Mr.
`
`Schexnaildre has been a registered investment adviser representative with the Securities and
`
`Exchange Commission through his then-employer United Capital Financial Advisers, LLC
`
`(“United Capital’).
`
`2.
`
`Defendant Financial Industry Regulatory Authority, Inc. (“Defendant”or
`
`“FINRA”), is a self-regulatory organization registered with the Securities Exchange Commission
`
`as a national securities association authorized to regulate the U.S. securities markets and
`
`professionals whosell securities in the United States pursuant to the Securities Exchange Act of
`
`1934, 15 U.S.C. § 78a et seq. (the “Act’’).
`
`3.
`
`FINRA is obligated to “establish and maintain a system for collecting and
`
`retaining registration information” about registered representatives. See 15 U.S.C. § 780—
`
`3(i)(1)(A). “Registration information”is defined as “information reported in connection with the
`
`registration or licensing of brokers and dealers and their associated persons.” See 15 U.S.C. §
`
`780-3(i)(1)(A).
`
`
`
`4.
`
`Registration information is reported to FINRA on the Uniform Application for
`
`Securities Industry Registration or Transfer (“Form U4”) and is maintained in FINRA’s Central
`
`Registration Depository (“CRD”) database.
`
`op
`
`Certain registration informationrelating to disputes with customers is made
`
`available to the public via an online resource, https://brokercheck.finra.org/ (“BrokerCheck”).
`
`6.
`
`FINRA Rule 2080, promulgated by FINRA pursuantto its rulemaking authority
`
`under the Act, provides that “membersand associated persons seeking to expunge information
`
`from the CRD system arising from disputes with customers must obtain an order from a court of
`
`competent jurisdiction directing such expungement...”
`
`7.
`
`Mr. Schexnaildre, a registered investment advisor representative,is an “associated
`
`person” under FINRA’s rulesand is identified by FINRA with CRD No. 6182170.
`
`8.
`
`Mr. Schexnaildre has been a registered representative for over 10 years and has
`
`never had any customer complaint disclosure placed on his CRD otherthan that described
`
`herein.
`
`9.
`
`Mr. Schexnaildre’s BrokerCheck report currently contains informationrelating to
`
`a customerdispute, which was reported by United Capital to FINRA on a Form U4andis
`
`identified as CRD Occurrence No. 2123067 (the “Disclosure’’).
`
`10.
`
`The Disclosure relates to Dr. Eric Klein and Mrs. Jamie Klein, who are long-time
`
`customers of Mr. Schexnaildre, in connection with their respective IRA accounts(the
`
`“Customers”).
`
`11.
`
`The Disclosure alleges receipt by United Capital of a written complaint seeking
`
`$200,000 in damagesandalleging, “Investmentadviser failed to disclose the risks associated
`
`with the exit of a collar in a discretionary account.”
`
`
`
`12.
`
`Because nolitigation or arbitration was ever commencedagainst United Capital
`
`or Mr. Schexnaildre, there is no case name or docket numberthat gave rise to the Disclosure nor
`
`is there any final decision in anyarbitration or civil litigation relating to the Disclosure.
`
`13.|Mr. Schexnaildre has consistently denied the allegation as false, and the
`
`Customers agreed, having withdrawn their complaint, as reflected in the Disclosure.
`
`14.
`
`An investmentcollar strategy involves holding a long position in a stock while
`
`simultaneously buying a protective put option and selling a coveredcall option. This strategy
`
`limits potential losses while also capping potential gains, effectively creating a range within
`
`which the investments returns will fall.
`
`15.
`
`At the time of the investment in the Summerof 2020 during the COVID-19
`
`Pandemic and in the months leading up to the Presidential Election, the collar strategy was
`
`consistent with the Customers’ expressed investment objectives of limiting downside risk during
`
`a potentially volatile period in the market and the Nation.
`
`16.
`
`Mr. Schexnaildre clearly disclosed to the Customers the risks associated with the
`
`exit of the collar, including missing out on potentially larger gains. Through the many
`
`explanations given by Mr. Schexnaildre and those working with him, in addition to the
`
`documents received by the Customers, the Customers were made aware of the both the benefits
`
`and risks of pursuing the collar investment strategy. Given the uncertainty in the market because
`
`of the COVID-19 pandemic in the summerof 2020, they chose to minimizethe risk on the
`
`downside.
`
`17.
`
`The Customersalso indicated in one or more agreements associated with the
`
`investments that their investment objective was “most aggressive” and they could tolerate “wide
`
`fluctuations in market value, especially over the short term.”
`
`
`
`18.
`
`After the markets realized significant gains during the second half of 2020, the
`
`question wasraised as to why their accounts, which had increased in value, did not benefit even
`
`more from the advancing market. This question was interpreted by United Capital as a customer
`
`complaint to be reported on Mr. Schexnaildre’s Form U-4.
`
`19.
`
`The Customers, however, acknowledgedthat the investment was suitable and that
`
`they understoodthe risks and benefits of the collar strategy; and withdrew any “complaint.”
`
`20.
`
`FINRA Rule 2080 contemplates that a Court exercising its equitable powers may
`
`issue an order of expungement from the CRD system.
`
`21.
`
`Theallegations described in the Disclosure are “clearly erroneous” under FINRA
`
`Rule 2080(b)(1)(A) and/or “false” under FINRA Rule 2080(b)(1)(C).
`
`22.+Asaresult of all of the foregoing, Mr. Schexnaildreis entitled to a court order
`
`directing FINRA to expunge the Disclosure from his CRD record.
`
`
`
`WHEREFORE,Plaintiff claims:
`
`1. A declaratory judgmentthat the allegation that is subject of the Disclosureis “clearly
`
`erroneous” under FINRA Rule 2080(b)(1)(A) and/or“false” under FINRA Rule
`
`2080(b)(1)(C).
`
`2. A permanent mandatory injunction requiring FINRA to expungeall referencesto the
`
`Disclosure relating to Plaintiff from the Plaintiff's Form U-4, the CRD, Brokercheck
`
`and all other documents in whichit exists.
`
`3. Such other and furtherrelief as the Court deemsjust and proper.
`
`Dated this 6" day of August, 2024.
`
`THE PLAINTIFF
`ASHLEY R. SCHEXNAILDRE
`—
`\
`
`ffBe Jy
`
`
`Richard Slavin, Esq.
`Cohen and Wolf, P.C.
`320 Post Road West
`Westport, CT 06880
`P: 203.341-5310 | F: 203.341.5311
`rslavin@cohenandwolf.com
`
`David Dobin, Esq.
`Cohen and Wolf, P.C.
`1115 Broad Street
`Bridgeport, CT 06604
`Tel: (203) 368-0211
`Fax: (203) 394-9901
`ddobin@cohenandwolf.com
`Juris #010032
`
`
`
`RETURN DATE: SEPTEMBER10, 2024
`
`SUPERIOR COURT
`
`ASHLEY R. SCHEXNAILDRE,
`Plaintiff
`
`JUDICIAL DISTRICT OF
`BRIDGEPORT
`
`VS.
`
`FINANCIAL INDUSTRY REGULATORY
`AUTHORITY,INC.,
`Defendant
`
`AUGUST6, 2024
`
`STATEMENT OF AMOUNT IN DEMAND
`
`The Plaintiff hereby states that the amount in demand,exclusive of interest and costs,is
`
`greater than FIFTEEN THOUSAND($15,000) DOLLARS.
`
`THE PLAINTIFF
`ASHLEY R. SCHEXNAILDRE
`oe HCPAony ae
`
`
`
`
`Richard Slavin, Esq.
`Cohen and Wolf, P.C.
`320 Post Road West
`Westport, CT 06880
`P: 203.341-5310 | F: 203.341.5311
`rslavin@cohenandwolf.com
`
`David Dobin, Esq.
`Cohen and Wolf, P.C.
`1115 Broad Street
`Bridgeport, CT 06604
`Tel: (203) 368-0211
`Fax: (203) 394-9901
`ddobin@cohenandwolf.com
`Juris #010032
`
`
`
`RETURN DATE: SEPTEMBER10, 2024
`
`: SUPERIOR COURT
`
`ASHLEY R. SCHEXNAILDRE,
`Plaintiff
`
`JUDICIAL DISTRICT OF
`:
`: BRIDGEPORT
`
`VS.
`
`FINANCIAL INDUSTRY REGULATORY
`AUTHORITY,INC.,
`Defendant
`
`SS: Wess por
`
`))
`
`)
`
`STATE OF CONNECTICUT
`
`COUNTY OF FAIRFIELD
`
`The undersigned, under oath, hereby states and deposesthat the matters contained in the
`
`foregoing Verified Complaintare true to the best of my knowledge andbelief.
`
` Schexnaildre
`Onthis the Laeaa ofAugust, 2024, Ashley R. Schexnaildre personally appeared
`
`before me, the undersigned officer, known to meto be the person whose nameis subscribed to
`the within instrument, and acknowledgedthat he executed the same for the purposestherein
`contained.
`
`IN WITNESS WHEREOFI hereunto set my hand.
`
`YEUtt io, UA, ee.
`Wurst Aor
`
`
`DateSuperiorCourt~ Notary Public/Commissioner-ofthe
`
`
`My Commission Expires:
`
`RANDALLN. BECKER
`Notary Pusiic-StateofConnecticut
`My Commission Expires
`October31, 2026
`
`ase et titres,
`at ER
`ts
`
`*
`
`Heese vert!
`
`
`
`RETURN DATE: SEPTEMBER10, 2024
`
`SUPERIOR COURT
`
`ASHLEY R. SCHEXNAILDRE,
`Plaintiff
`
`JUDICIAL DISTRICT OF
`BRIDGEPORT
`
`VS.
`
`FINANCIAL INDUSTRY REGULATORY
`AUTHORITY,INC.,
`Defendant
`
`AUGUST6, 2024
`
`CERTIFICATE PURSUANT TO PRACTICE BOOK SECTION 17-56(b)
`
`Plaintiff hereby certifies that all persons who havean interest in the subject matter of the
`
`declaratory judgment requestedinthis action,that is direct, immediate, and adverse to the
`
`interest of one or moreofplaintiff or defendants, have been namedparties to this action, or been
`
`given reasonable notice thereof.
`
`Plaintiff further certifies that it has given notice of this action, via registered or certified
`
`mail, return receipt requested, to the following parties who maypossessa direct, immediate,
`
`and/or adverseinterests in the subject matter of the declaratory judgment requested in this action,
`
`at the following addresses:
`
`Dr. Eric Klein
`20 Manitou Road
`Westport, CT 06880
`
`Mrs. Jamie Klein
`20 Manitou Road
`Westport, CT 06880
`
`State of Connecticut Departmentof
`Banking
`Attn: Securities Division
`260 Constitution Plaza
`Hartford CT 06103-1800
`
`State of Connecticut Departmentof
`Banking
`c/o Attorney General
`165 Capitol Avenue, Suite 5
`Hartford, CT 06106
`
`United Capital Financial Advisers, LLC
`c/o Corporation Service Company, Agent
`for Service
`Goodwin Square
`225 Asylum Street
`20th Floor
`Hartford, CT, 06103
`
`
`
`THE PLAINTIFF
`
`ASHLEY R. SCHEpune :
`2. GQOLax
`
`Richard Slavin, Esq.
`Cohen and Wolf, P.C.
`320 Post Road West
`Westport, CT 06880
`P: 203.341-5310 | F: 203.341.5311
`rslavin@cohenandwolf.com
`
`David Dobin, Esq.
`Cohen and Wolf, P.C.
`1115 Broad Street
`Bridgeport, CT 06604
`Tel: (203) 368-0211
`Fax: (203) 394-9901
`ddobin@cohenandwolf.com
`Juris #010032
`
`
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