Morgan Keegan & Co. has three weeks to pay former Chicago Bulls basketball star Horace Grant $333,000 or it could lose its brokerage license.
The Memphis-based firm that was acquired by Raymond James Financial Inc. last April, received a letter from the Financial Regulatory Authority Inc. dated Nov. 19 stating that the brokerage had until Dec. 10 to pay the full arbitration award of $1.46 million plus interest to Mr. Grant or its operating license would be revoked.
“Morgan Keegan is trying to stiff Horace Grant out of over $300,000 in interest he's entitled to by law,” said Andrew Stoltmann, Mr. Grant's lawyer.
The case was one of over a thousand that were filed against Morgan Keegan after several of its bond funds imploded during the financial crisis. The brokerage has already paid Mr. Grant $1.59 million, but according to Mr. Stoltmann they owe him more.
“Our position is that they owe 10% interest from the date of the award [Sept. 11, 2009],” said Mr. Stoltmann. He said Morgan Keegan is trying to claim they owe the 10% interest only from the date of the award until July 2010, when it lost its case in court trying to overturn the award. The brokerage appealed that decision and lost the appeal last month.
Morgan Keegan is refusing to go down without a fight and has asked the federal court to determine whether it owes the additional interest.
“Morgan Keegan has already paid in full the award rendered in the Grant arbitration proceeding….Morgan Keegan disputes the additional amount requested and, as of today, will ask the appropriate federal court to determine whether any additional interest is owed. This should resolve the matter of Morgan Keegan's supposed impending “suspension” since, as the FINRA notice itself states, no action will be taken so long as Morgan Keegan timely demonstrates it has paid the award in full,” the company said in a statement.