Carl’s practice focuses on commercial litigation, particularly investment and securities litigation, FINRA arbitrations, and trust and estate litigation. He has been a FINRA (formerly NASD) arbitrator since 2000, and writes and speaks frequently on securities litigation and trust and estate litigation topics.
In his securities litigation practice Carl represents investors, stockbrokers, registered investment advisors and brokerage firms. He has represented both sides in cases involving investment losses, unsuitable investment recommendations, negligent investment advice, securities losses, securities fraud, and stock fraud; retirees with claims over losses in 401(k) and other retirement accounts, investors in private offerings, Ponzi scheme victims, employees with claims over losses on stock options or company stock, developers selling tenant-in-common (TIC) interests, registered representatives and brokerage firms in employment claims such as raiding, breaches of noncompete agreements, and collection of forgivable promissory notes, and registered representatives and sellers of private offerings in securities regulatory proceedings. Carl has pursued and defended innumerable claims in FINRA arbitrations and state and federal courts involving investments in stocks, bonds, leveraged ETFs and inverse ETFs such as ProShares, mutual funds, closed-end mutual funds, limited partnerships, initial public offerings, annuities, equity indexed annuities, structured products, tenant-in-common interests, REITs, principal protected notes and other securities products.
In his trust litigation and estate litigation practice, Carl has represented parties in cases involving will contests and lost will cases; disputes over revocable living trusts, and trust accountings; trustees and successor trustees defending claims for investment losses or breaches of fiduciary duties; trust beneficiaries pursuing claims for imprudent investments or breaches of fiduciary duty; victims of elder financial abuse; executors and heirs in probate litigation, such as removing executors or personal representatives; and surviving spouses’ claims for equitable contribution.
Carl joined Tousley Brain Stephens in 2013 when the firm he founded, Carlson & Dennett, P.S., merged into Tousley Brain Stephens after 17 years of operation.
Garrison v. Sagepoint Financial, Inc. 185 Wn.App. 461, 345 P.3d 792 (2015). – Trial pending; represent trusts in action against stock brokerage firm alleging failure to supervise one of its stockbrokers who, while acting as Financial Advisor employed by a different financial advisory firm, lost or diverted over $20 million from trusts held at anther brokerage firm. Won appeal on an issue of first impression, holding that a brokerage firm may have a duty to supervise a dually-registered stockbroker/financial adviser in such circumstances.
Gretchen Doe v. Wachovia Securities LLC – Represented investor who lost $600,000 on junk bonds recommended by her stockbroker. Settled for return of full $600,000 purchase price to client.
International Brachytherapy s.a. v. Core Oncology, Inc. – Represented European company in claim to recover $2 million invested in securities in a U.S. company, based on alleged misrepresentations in connection with the sale of the securities. After case fully prepared for trial in U.S. District Court in Seattle, settled for $1.7 million.
Jenny and Lorrie Roe v. A.G. Edwards & Co. – Represented investors in unsuitability claim based on recommendations that investors engage in margin borrowing. Following three day NASD (now FINRA) securities arbitration hearing, clients awarded $165,000.
Salomon Smith Barney et. al v. U.S. Bancorp Piper Jaffray, et. al. – Represented two retired Smith Barney brokers in action against former Smith Barney broker with whom they had fee sharing agreement, to recover losses after broker quit Smith Barney and took retirees’ former customers to his new firm. Following three day NASD(now FINRA) securities arbitration hearing, panel awarded client full damages and attorneys’ fees.
Securities arbitrations – Defended a California securities firm in numerous securities arbitration claims by investors against firm’s stockbrokers working in branch offices in Washington state, for negligent or unsuitable investment recommendations, churning, securities fraud and other claims. Represented same securities firm in claim against Merrill Lynch for Merrill Lynch’s failure to disclose bad conduct by a rogue ex-Merrill Lynch broker in response to pre-employment inquiry by client. Client hired rogue broker, who subsequently diverted several customers’ money. Matter settled on confidential terms.
Represented national stock brokerage firm in claim against another firm for raiding stockbrokers from client’s Seattle branch office. Case settled shortly before arbitration hearing.
Represented a Washington state Indian Nation in claims against stockbrokers and broker-dealer for unsuitable recommendations that the Nation use short-term, low-risk funds to trade in shares of initial public offerings of closed-end mutual funds. Following 12-day securities arbitration hearing, client awarded $391,000.
Represented regional brokerage firm seeking indemnification from two former employee stockbrokers for expenses incurred as the result of customer claims alleging unsuitable asset allocation of investment portfolio by the stockbrokers. Following securities arbitration hearing, mixed award was issued.
Co-authored Amicus Brief of the Public Investors Arbitration Bar Association, filed inRaymond James Fin. Servs., Inc. v. Phillips, No. 2D10-2144, 2011 WL 5555691 (Fla. Dist. Ct. App. Nov. 16, 2011), review granted, 81 So. 3d 415 (Fla. 2012). Court of Appeals, held for first time that Florida’s statutes of limitations do not apply to FINRA arbitrations.
Wrote Amicus Brief of the Public Investors Arbitration Bar Association, filed in Broom v. Morgan Stanley DW, 169 Wn.2d 231 (2010) (with Joseph C. Long, Professor Emeritus, Univ. of Oklahoma Law School). In a significant ruling on securities arbitrations, Washington State Supreme Court held that Washington’s statutes of limitation do not apply in FINRA arbitrations.
In re Estate of Black, 153 Wn.2d 152, 102 P.3d 796 (2004) – Represented party in a will contest in Adams County Superior Court involving a lost will. Preliminary rulings by Superior Court appealed to State Supreme Court, which issued a frequently-cited opinion on the law of lost wills. After remand for trial, case settled on confidential terms.
In re Estate of Ives v. Ramsden, 142 Wn. App. 369, 174 P.3d 1231 (2009) – Represented estate of elderly investor in claims against financial advisor for unsuitable recommendations to invest in limited partnerships. Following trial in Clallam County Superior Court, court awarded damages and full attorneys’ fees to client. Decision upheld on appeal to Washington State Court of Appeals, resulting in a significant opinion on Washington law involving securities law claims.
In re Estate of Kazmark, 170 Wn. App. 1022 (2012) (unpublished) – Represented heirs in will contest involving mutual wills. Following three day trial in Spokane County Superior Court, Judge revoked will under which clients had been disinherited and reinstated the mutual will under which clients received 75% of estate. Defended appeal, in which Court of Appeals upheld trial court decision.
John Does v. Morgan Stanley Trust Company – Represented trust beneficiaries in claim against trust company and insurance company, alleging trustee’s and insurance company’s failures to properly handle a life insurance trust. Case settled shortly before trial, with client recovering $540,000, including all attorneys’ fees and costs.
John Does v. Seattle law firm – Represented heirs in legal malpractice claim against attorney who drafted a will that did not include a tax credit trust. Case settled a week before trial for $300,000.
Roe v. Doe, Trustee – Defended trustee of family trust against $1.9 million claim by remainder beneficiary alleging trustee had unsuitably invested trust money, and made improper distributions to the trust’s income beneficiary (who was her father). Following two week King County Superior Court trial, court awarded damages of less than ten percent of amount sought, and small amount of attorneys’ fees. Both sides appealed to Washington State Court of Appeals, which affirmed all trial court rulings.
Represented trust beneficiaries in claims against professional fiduciary company that took over as successor trustee, following original trustee’s resignation, for failure to properly review and change imprudently-invested trust portfolio which then lost heavily in crash of Internet stocks in 2000. Settled for substantial amount on confidential terms.
Chen v. Days Inn Hotel – Defended hotel in a two day trial against claim by former general manager for alleged wrongful withholding of wages involving unpaid $100,000 bonuses and salary. Court awarded former general manager $3,000.
John Doe v. Housing Authority of the City of Houston – Represented Seattle owner of Section 8 houses in Houston, in action against Houston Housing Authority based on its failure to comply with federal regulations regarding rental rates. Case settled shortly before trial on terms acceptable to the client.
John Does v. National gun rights advocacy organization – Defended founder and Chairman of national nonprofit foundation in action by former foundation Executive Director and employees alleging malfeasance, and seeking receivership for foundation; client counterclaimed for defamation. Following six week King County Superior Court trial, all claims against client dismissed and client awarded $30,000 for defamation.
Commercial real estate foreclosures – Represented New West Federal Savings and Loan Association (entity formed by FSLIC after taking over failed savings and loan company during S&L crisis of early 1990s) in several commercial real estate foreclosures, receivership actions and bankruptcy litigation, as FSLIC sought to dispose of failed savings and loan company’s bad loans.
Ultramar of Canada, Inc. v. Westlake Petroleum, Inc. v. Union Oil Co. – Represented Union Oil Company in action by Canadian petroleum importer against oil broker for taxes incurred due to mishandled export of a barge of petroleum, and broker’s $350,000 third-party action against Union Oil. Following two week jury trial, jury awarded Canadian broker $100,000 in damages against client on third-party claim.
Windermere Real Estate South, Inc. v. John Doe – Defended real estate developer against Windermere real estate broker for claim for a $130,000 commission. Following two day trial in Grant County Superior Court, all claims were dismissed and Windermere was ordered to pay client’s attorneys’ fees.
Represented publicly-traded company defending wrongful termination claim by former managing director of company’s Southeast Asia Region; company counterclaimed against managing director alleging he conspired to embezzle corporate funds. Managing Director withdrew the wrongful termination claim before hearing, and following 2½ week AAA hearing, arbitrators awarded $5.9 million to the company on its embezzlement claims.
Co-chair, Washington State Bar Association CLE, 12th Annual Trust & Estate Litigation Seminar (April 2015)
Speaker and author: The Law of Mutual Wills in Washington, Washington State Bar Association, 9th Annual WSBA Trust and Estate Litigation Seminar (March 2012)
Speaker and author: Trust and Estate Fiduciaries’ Investment Duties and Risks, National Business Institute CLE (continuing legal education), Resolving Estate, Will and Trust Contests (March 2012)
Speaker and author: Comparison of the Federal ‘Manifest Disregard’ Standard vs. Washington State’s ‘Facial Legal Error’ Standard for Vacating Arbitration Awards
Rubic LLC, CLE, Review of Private Arbitration Awards: Washington & Federal (November 2010)
Author: The Implications of Trust and Estate Fiduciaries’ Investment Duties, The Codicil, WSBA Real Property, Probate and Trust Section Newsletter (Summer 2009)
Speaker and author: Damages in Estate and Trust Litigation, King County Bar Association 11th Annual Probate Litigation Seminar (2008)
Speaker and author: Identifying and Litigating Claims Against Stockbrokers and Investment Advisers, National Business Institute CLE, Securities Fraud: Prosecuting and Defending Securities Fraud Claims & Defense of Regulatory Actions (2008)
Author: The Prospectus Defense in Securities Arbitrations, Public Investors Arbitration Bar Association (PIABA) Bar Journal, Vol. 15, No. 2 (2008)
Speaker and author: Identifying and Pursuing Claims Against Investment Advisors, WSBA 4th Annual Trust and Estate Litigation Seminar (2007)
Author: A Primer on the Unauthorized Practice of Law in Securities Arbitrations: What You Don’t Know Can Hurt You, Securities Arbitration 2006: Taking Responsibility Practising Law Institute (2006)
Author: The Unauthorized Practice of Law in Securities Arbitrations: The Times They are a Changin’, PIABA Bar Journal, Vol. 13 (2006)
Speaker and author: Investors-Getting your Money Back, The Seminar Group CLE, Liability of Financial Advisers (2005 and 2006)
Speaker and author: Damages in Trust and Estate Litigation, WSBA CLE. Trust and Estate Litigation (2005)
Speaker and author: Securities Claims and the Probate Practitioner, King County Bar Association CLE, Annual Probate Litigation & Ethics Seminar (2004, 2005 and 2006)
Speaker: Claims Against Fiduciaries: Law and Theory, WSBA CLEs, Trust and Estate Litigation (April 2004); and 2004 Best of CLE (2004)
Chair: WSBA CLE, Securities Law for the Business Lawyer-And the Rest of Us (2003)
Speaker and author: Securities Arbitration: Practice and Procedure, Sources of Law Governing Stockbrokers, and Unauthorized Practice of Law Issues in NASD Arbitrations, National Business Institute CLE, Stockbroker Fraud (2003)
Chair and Speaker: The NASD Dispute Resolution Arbitration Process, King County Bar Association CLE, Money Troubles: Pursuing and Defending Claims Against Stockbrokers and Brokerage Firms (2001)
Speaker and author: Will Contests, King County Bar Association CLE, Probate Litigation and Ethics (1998-2000)
Speaker and author: Anatomy of the NASD Arbitration Process, National Business Institute CLE, Stockbroker Fraud (1999)
Chair and speaker: How to Process Claims Against Stockbrokers, King County Bar Association CLE, Stockbroker Litigation (1998)
Co-Chair and speaker: WSBA CLE , How to Handle Estate Planning/Probate Litigation (1997)
Co-chair and speaker: Stockbroker Blues: Customer Litigation Against Stockbrokers,King County Bar Association CLE (1994 and 1996)
Chair and speaker: King County Bar Association CLE, Probate Litigation (1994 and 1996)
Washington State Bar Association
King County Bar Association
Financial Industry Regulatory Authority (“FINRA,” formerly NASD) – Arbitrator
Public Investors Arbitration Bar Association – Member
RCH Technical Institute. Board of Directors. Renton, Washington college-level vocational school and job placement center for the physically disabled
BAR/BRI of Washington Bar Review. Lecturer for bar exam preparation course for many years, on Partnership Law, Limited Liability Companies, and the law of Agency
Gainsborough Condominium Homeowners’ Association, President
Recognized as a “Super Lawyer” in Washington Law & Politics magazine (2011-2015)
AV-Peer Review™ Rated by Martindale-Hubbell®
AVVO rating of 10.0 (highest possible)
J.D., Stanford Law School
B.A., Stanford University
U.S. District Court for the Eastern District of Washington
U.S. District Court for the Western District of Washington
U.S. Court of Appeals for the Ninth Circuit