Arbitration Fee Awards Are Spiking Upwards Over The Years.
Arbitrator-X.com has an interesting statistical survey of attorney’s fees awards in Financial Industry Regulatory Authority (FINDRA) arbitrations for the 10-year period of January 1, 2015-December 31, 2024, surveying 1,231 cases with fee awards. Only about 15% of FINDA arbitration awards include fee awards, likely because they were not requested, the arbitrators denied them (a discretionary decision if there is a contractual provision, statutory provision, or FINDRA rules that support fee-shifting in specified circumstances), or the case settled with no fee-shifting. However, the 10-year study did have some trends which we share with you now.
- In 2022, mean fee awards jumped to $247,519, before settling back to $168,580 in 2024—with the spike including one extraordinary case with a $53 million fee award. However, excluding this outlier, the 2022 mean of $195,000 remained dearly double the 2021 level. Also, the median also doubled from $33,000 in 2021 to $70,000 in 2022, a genuine distribution “shift.”
- The standard deviation bands are substantial, reflecting that fee awards vary dramatically from case to case.
- Despite yearly fluctuations, there is a clear upward trajectory from the $95,000-127,000 mean range (2015-2016) to the $168,000 mean range (2023-2024).
- Total fees awarded during the 10 years of cases in the survey totaled over $145 million.
- Median fee awards were consistently lower than means awards, indicating that a small number of very large awards pulled the average up materially.
- The median fee award has risen from $10,000-23,000 (2015-2020) to $25,000-70,000 (2021-2024).
- The 2022 spike in fee awards was heavily driven by customer cases, which saw large increases (nearly four times or $455,000) over the 2021 fee award level of $121,000, driven by the large $5.3 million fee award. However, customer case fee awards dropped back to more historical norms of $144,000-167,000 averages in 2023-2024.
- Employment and member-versus-member cases showed steady increases from $87,000 in 2021 to $180,000 in 2024, sans the 2022 spike.
- In 2024, mean fee award for 89 cases was $168,580, while the median was $25,000 (with the median up from $10,000-15,000 in the mid-2010s), suggesting arbitrators are more willing to award meaningful fee recoveries. This fee exposure may make respondents re-evaluate the merits of a case in their settlement risk calculus
- Early 2025 data suggested the upward trend looked to continue, with the mean fee awards potentially exceeding $185,000.