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Sacks filed a petition for review in the Ninth Circuit after the Commission approved three FINRA rules changes. He filed a motion with the Commission to stay its order approving the rules changes pending review in the court of appeals.
FINRA rules were amended to allow non-lawyers to represent persons in arbitrations unless state law prohibits it. The new rule does not permit persons previously barred from the industry to appear as a representative. Sacks was previously barred and represents people in arbitrations.
Stays pending appeal may be granted by the Commission if "justice so requires." Previously the Commission has considered four factors in deciding such motion: 1) whether petitioner has shown a strong likelihood he will prevail; 2) whether he will suffer irreparable injury; 3) whether there will be substantial harm to other parties if a stay is granted; and 4) whether a stay will serve the public interest.
The Commission denied the stay. It noted that a stay pending appeal is an extraordinary remedy. Among other things, Sacks did not comply with Commission rules that require that before a petition for stay is filed after the Commission acts pursuant to delegated authority as it did here, written notice must be sent to the Commission. It also ruled that financial detriment (here Sacks claimed his business would be destroyed by the rule) does not constitute irreparable injury.