Reinsurance Focus

A number of significant arbitration award decisions have been handed down over the past several weeks.

Orders generally confirming or vacating arbitration awards

• The Ninth Circuit recently reversed the vacatur of an award finding that the award was not excessive in size and that the arbitration panel did have jurisdiction to enter a punitive damages award. However, the Ninth Circuit also found that Lloyds Underwriters failed to establish the partiality of two of the arbitrators. Lagstein v. Certain Underwriters at Lloyd’s, London, Case No. 03-01075 (9th Cir. June 10, 2010).
• In Perhach v. Option One Mortgage Corp., Case No. 08-60637 (11th Cir. June 15, 2010), the Eleventh Circuit affirmed the district court’s denial of Albert Perhach’s pro se motion for relief from an order compelling arbitration and his motion to vacate the arbitrator’s award in favor of his former employer Option One Mortgage Corp.
• The Southern District of New York in Rai v. Barclays Capital Inc., Case No. 10-1675 (S.D. N.Y. June 15, 2010) denied Rai’s motion to vacate an arbitration award against him and entered an order confirming the award in Barclays’ favor.
• Hearing cross-motions to confirm and vacate an arbitration award in Petrie v. Clark Moving & Storage, Case No. 09-06495 (W.D.N.Y. May 17, 2010), the Western District of New York confirmed the arbitrator’s award in favor of the Petries finding no manifest disregard of the law.
• The Northern District of California denied Pacific Development Partners motion to vacate or modify an arbitration award in favor of Elem Indian Colony of Pomo Indians. The Court affirmed the arbitrator’s ruling that a contract for casino development was void. Elem Indian Colony of Pomo Indians v. Pacific Development Partners X, LLC, Case No. 09-1044 (N.D. Cal. May 19, 2010).
• In Adams v. Barnes, Case No. 09-1860 (N.D. Tex. June 17, 2010), the District Court denied former Dallas Cowboy Flozell Adams’ motion to vacate an arbitration award in favor of his former agent Roosevelt Barnes. The Court confirmed the award.
• In International Brotherhood of Teamsters, Local 701 v. CBF Trucking, Inc., Case No. 09-5525 (D. N.J. June 10 2010), the District Court granted the union’s motion to dismiss CBF Trucking counterclaim and confirmed an arbitration award in favor of the Teamsters.

Violation of public policy

• In American Postal Workers Union, AFL-CIO v. United States Postal Service, Case No. 09-1084 (N.D. Tex. May 14, 2010), the District Court dismissed plaintiffs’ Complaint to Vacate Arbitration Award and confirmed defendant’s motion to confirm the award. The Court held that the award did not violate Texas public policy and that the award was not a result of any factual error in the arbitrator’s findings.

Attorneys fees

• Illinois Union Ins. Co. v. North County Ob-Gyn Medical Group, Case No. 09-2123 (S.D. Cal. May 18, 2010): The Southern District of California confirmed an arbitration panel’s ruling that legal fees paid by the insurance company on the medical group’s behalf eroded the liability of a policy issued by IU to NCOG.
• In First Automotive Service Corp. v. First Colonial Ins. Co., Case No. 07-682 (M.D. Fla. June 16, 2010), the District Court denied motions to remand the case and for sanctions under Rule 11 and confirmed a modified arbitration award as to attorneys’ fees and costs. Judgment was entered in favor of First Automotive and Northbrook Indemnity Co.

Interest

• In Diaz v. Cruz, Case No. 09-286 (Mass. Ct. App. May 21, 2010), the Massachusetts Court of Appeals determined that, while the Superior Court had jurisdiction to hear a motion to confirm an arbitration award, it erred in granting prejudgment interest in favor of the plaintiff.

This post written by John Black.