Bed, Bath & Beyond Losses with Morgan Stanley Broker Derek M Johnson?

MORGAN STANLEY (Respondent) recently had a FINRA arbitration filed against them by customers of DEREK MICHAEL JOHNSON. The Claimants, who reside in California, maintained accounts with the Respondent and their registered representative, DEREK MICHAEL JOHNSON (DEREK M JOHNSON). Johnson is not named in the lawsuit.

The lawsuit alleges that the Claimants did not wish to speculate with their savings since they were nearing retirement and both had health issues.  According to the lawsuit, DEREK M JOHNSON continuously purchased Bed, Bath & Beyond stock for the Claimants. The lawsuit alleges that Johnson continued to purchase stock even after Bed, Bath & Beyond declared bankruptcy, allegedly hoping the stock would return to $40 per share.  DEREK M JOHNSON, according to the lawsuit, also allegedly overconcentrated the Claimants’ savings in speculative energy stocks which have also experienced significant declines. The lawsuit states that many of these recommendations occurred in retirement accounts where the Claimants cannot claim tax losses.

The lawsuit is alleging the Claimant has suffered damages of over $750,000, due to violations by the Respondent of Breach of Fiduciary Duty, Violation of NASD and NYSE Rules, Breach of Contract, Negligent Supervision and Negligence.

According to Markets.com the decline of Bed Bath & Beyond reflected challenges faced by traditional retailers in an increasingly competitive market, due to shifts in consumer behavior and the rise of e-commerce.  Shareholders did not receive any compensation following the cancellation of Bed Bath & Beyond shares. Instead, proceeds from asset sales or debt restructuring will be used to repay secured creditors and other debt holders.

According to FINRA’s BrokerCheck, available to the public on FINRA’s website, DEREK M JOHNSON has been registered both as a broker and investment advisor with MORGAN STANLEY of Brea, California since 6/5/2020.  He was previously registered with JP MORGAN SECURITES of Newport Beach, California from 01/20/2012 - 06/11/2020. Johnson has 19 years of experience in the securities industry and has been listed with 4 firms. 

There is one disclosure, a “Customer Dispute,” listed on DEREK M JOHNSON’s FINRA CRD report dated 12/10/2021.  The allegations were, “Claimant alleges Registered Rep recommended an unsuitable investment strategy. Activity dates October 2017 to May 2020.”  This dispute settled for $750,000.00.

To discuss this article or any other securities issues contact Soreide Law Group and speak to an experienced securities lawyer at no cost:  888-760-6552.

Soreide Law Group represents our clients nationwide before FINRA on a contingency fee basis. Soreide Law Group encourages other clients of DEREK M JOHNSON who lost money in Bed, Bath & Beyond to call our firm to discuss your rights and to find out if you may also be able to file a FINRA arbitration to recoup some or all of your losses.