Reinsurance Focus

A number of significant arbitration award decisions have been handed down in the last few weeks:

Employment

• The District Court confirmed an arbitration award as to Main Line that was originally obtained against Main Line by a sister local union. The Court found Main Line in violation of the union’s collective bargaining agreement and that the grievance procedure was properly followed. Sheet Metal Workers’ Int’l. Assoc. Local Union 27 v. Main Line Mechanical, Inc., Case No. 10-01873 (USDC D. N.J. Oct. 25, 2010).
• On cross motions for summary judgment, the District Court granted in part and denied in part HPD’s motion, finding that the arbitrator correctly found that HPD had cause to terminate plaintiff Shaw. The arbitration award was confirmed, except for as to attorneys’ fees and costs. Shaw Constructors v. HPD, LLC, Case No. 10-01874 (USDC E.D. La. Oct. 26, 2010).
• The District Court for Puerto Rico granted Puerto Rico Telephone Co.’s motion for summary judgment finding that plaintiff had failed to establish that the arbitral decision on behalf of a terminated union member should be set aside. The arbitrator’s decision was confirmed. Union Independiente de EmpleadosTelefonicos de Puerto Rico v. Puerto Rico Telephone Co., Case No. 10-1667 (USDC D. P.R. Nov. 15, 2010).
• A physician and his wife initiated an employment action against Washington Hospital Center, which resulted in arbitration. Dr. Tio moved for a vacatur of the award, which was denied by the District Court. Tio v. Washington Hospital Center, Case No. 08-00626 (USDC D.D.C. Nov. 30, 2010).

Jurisdictional Decisions/International Agreements:

• The Sixth Circuit affirmed the District Court’s determination that it lacked jurisdiction to confirm an arbitration panel’s interim award denying class arbitration for lack of ripeness. The Court of Appeals ruled that Dealer Computer failed to demonstrate cognizable hardship. Dealer Computer Servs., Inc. v. Dub Herring Ford, Case No. 09-1848 (6th Cir. Oct. 14, 2010).
• The Eastern District of Pennsylvania vacated its own prior confirmation of an arbitration award in favor of Aurum Asset Managers, finding that it lacked subject matter jurisdiction to confirm the award because Banco is entitled to sovereign immunity. Aurum Asset Managers, LLC v. Banco de Estado do Rio Grande do Sul, Case No. 08-00102 (USDC E.D. Pa. Oct. 13, 2010).
• The Southern District of New York granted Japanese entity NTT DoCoMo’s motion to confirm an arbitration award, finding the US public policy did not preclude an arbitration panel from ordering specific performance of a stock purchase agreement. NTT DoCoMo v. Ultra D.O.O., Case No. 10-03823 (USDC S.D. N.Y. Oct. 12, 2010).
• The Southern District of New York recently granted Swedish firm NYKCool’s motion to confirm an arbitration award and for post-award interest on a dispute related to Contracts of Affreightment. NYKCool A.B. v. Pacific Fruit Co., Case No. 10-03867 (S.D. N.Y. Nov. 24, 2010).

Manifest Disregard for the Law:

• The Second Circuit recently issued a Summary Order affirming the District Court’s confirmation of an arbitration award in favor of the County of Nassau. The Court applied New York law and determined that the award was not in manifest disregard of law because it was not irrational, and that no arbitrator partiality was demonstrated. County of Nassau v. Chase, Case No. 09-3642 (2d Cir. Oct. 4, 2010).
• The District Court for Arizona confirmed an arbitration award against AZ Holding, finding that the arbitrator’s failure to award attorneys’ fees and costs did not amount to manifest disregard of the law. AZ Holding, LLC v. Frederick, Case No. 08-00276 (USDC D. Ariz. Nov. 29, 2010).
• The Southern District of New York denied Goldman Sachs’ motion to vacate an arbitration award and instead confirmed the award, ruling that the arbitrator did not manifestly disregard the law, even though he did not explicate the reasons for his ruling. Goldman Sachs Execution & Clearing L.P. v. The Committee of Unsecured Creditors’ Committee of Bayou Group, LLC, Case No. 10-05622 (USDC S.D. N.Y. Nov. 30, 2010).

This post written by John Black.