EIGHTH CIRCUIT HOLDS THAT HALL STREET ELIMINATED MANIFEST DISREGARD OF LAW DOCTRINE; AFFIRMS ARBITRATION AWARD
Following an arbitration award and district court confirmation granting Medicine Shoppe International lost future profits and future license fees, defendants/appellants Turner Investments and Donnie Turner (President of Turner Investment) appealed to the Eighth Circuit arguing that the district court erred in confirming the award because the arbitrator showed a manifest disregard for the law. Specifically, Turner Investments assert that Medicine Shoppe failed to demonstrate future profits with reasonable certainty as required by Missouri law, that Medicine Shoppe failed to mitigate damages, and that the award of future fees to a franchisor hampered the growth of important franchise markets contrary to public policy. The Eighth Circuit affirmed the award, citing Hall Street Assoc. LLC v. Mattel, Inc., 552 U.S. 576 (2008) for the proposition that only the enumerated reasons listed in the FAA justify vacatur of an arbitration award. Having found that none of the enumerated reasons existed, the Court affirmed the judgment of the district court. The Eighth Circuit therefore joins the list of Circuit Courts of Appeal which have held that the doctrine of manifest disregard of law did not survive Hall Street. Medicine Shoppe Int’l, Inc. v. Turner Investments, Inc., Case No. 09-2179 (8th Cir. July 21, 2010).
This post written by John Black.
