Wednesday, December 14, 2005

Arbitrators' Refusal to Compel Discovery Does Not Support Vacatur of Panel's Award

Per BNA's U.S. Law Week (Volume 74 Number 22 Tuesday, December 13, 2005, Page 1339):

Arbitrators' refusal to compel requested discovery in a reinsurance dispute does not justify vacatur of the arbitration award under the Federal Arbitration Act, the U.S. Court of Appeals for the First Circuit held Dec. 2 (National Casualty Co. v. First State Insurance Group, 1st Cir., No. 05-1505, 12/2/05).

Even if the FAA allows vacatur based on such a refusal, no violation occurred here, Judge Norman H. Stahl said, because the arbitration panel, by drawing negative inferences against the party that resisted discovery, avoided any deprivation of a fair hearing that could justify vacatur.

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