IN FEBRUARY 2009, [CUSTOMER] COMPLAINED TO CLEARY GULL ALLEGING CLEARY GULL HAD: (A) FAILED TO FOLLOW A TRANSITION PLAN RELATIVE TO THE INVESTMENT OF HIS ASSETS WITH CLEARY GULL; (B) FAILED TO CREATE A FIXED-INCOME PORTFOLIO; (C) FAILED TO IMPLEMENT HEDGING POSITIONS; AND (D) PURCHASED NEW SECURITIES WITH CASH RATHER THAN TRANSFERRING EXISTING SECURITIES. IN AUGUST OF 2009,[CUSTOMER] RETAINED COUNSEL WHO THEN ASSERTED ON [CUSTOMER]'S BEHALF A CLAIM OF IN EXCESS OF $2 MILLION, ALLEGING: (A) A FAILURE BY CLEARY GULL TO HAVE INVESTED [CUSTOMER]'S ASSETS IN AN 80/20 RATIO BETWEEN EQUITIES AND FIXED-INCOME; AND (B) A FAILURE TO PURCHASE HEDGES AGAINST [CUSTOMER]'S ENTIRE ACCOUNT. [CUSTOMER] BEGAN INVESTING WITH CLEARY GULL IN AUGUST OF 2007. FOR EACH OF HIS ACCOUNTS, INVESTMENT MANAGEMENT SERVICES ADVISORY AGREEMENTS WERE ENTERED THAT PROVIDED CLEARY GULL WITH FULL DISCRETIONARY AUTHORITY TO MAKE ALL INVESTMENT DECISIONS. [CUSTOMER]'S ACCOUNTS SUFFERED DECLINES DURING THE FALL AND WINTER OF 2008, DURING THE SAME PERIOD OF TIME THAT THE OVERALL SECURITIES MARKET SUFFERED UNPRECEDENTED DECLINES. CLEARY GULL DISPUTED [CUSTOMER]'S CLAIMS IN THEIR ENTIRETY BELIEVING [CUSTOMER]'S CRITICISMS OF CLEARY GULL'S INVESTMENT PERFORMANCE TO BE NOTHING MORE THAN HINDSIGHT ATTACKS ON WHAT WERE OTHERWISE SOUND INVESTMENT DECISIONS THAT HAD BEEN RATIFIED BY [CUSTOMER] AT THE TIME. MR GRENIER WAS EMPLOYED AS A RELATIONSHIP MANAGER WITH CLEARY GULL. HIS PRIMARY RESPONSIBILITY WAS TO COORDINATE CLIENT SERVICE INCLUDING THE COORDINATION OF THE SERVICES OF OUTSIDE TAX AND ESTATE PLANNING ADVISORS. ALTHOUGH MR GRENIER WAS IDENTIFIED IN THE COMPLAINT LETTER, HIS RESPONSIBILITIES ARE NOT RELATED TO THE SUBJECT OF THE COMPLAINT.

$2,000,000.00

$250,000.00