725 F.3d 27
1st Cir.2013Background
- Doral appeals a district court decision denying vacatur of an arbitral award arising from García-Vélez's severance claim.
- Doral argued the arbitration tribunal misconducted by denying pre-hearing and hearing subpoenas related to García-Vélez's employment with the merged entity.
- The tribunal scheduled and conducted arbitration, addressing subpoenas after deadlines; it denied both pre-hearing and hearing subpoenas as untimely or improper.
- The award found García-Vélez entitled to severance and ordered pre-award interest; Doral was ordered to pay substantial fees and costs.
- Doral sued in district court seeking vacatur under 9 U.S.C. § 10(a)(3) for misconduct and excess of powers regarding pre-award interest.
- The district court denied vacatur; the First Circuit affirms, upholding the arbitration process and the award.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Did the tribunal's denial of subpoenas constitute misconduct under § 10(a)(3)? | Doral: denial prevented relevant evidence; violated fair hearing. | García-Vélez: subpoenas untimely; would have delayed proceedings; tribunal has discretion. | No misconduct; fair hearing satisfied; denial within tribunal's discretion. |
| Was the award of pre-award interest within the tribunal's authority? | Doral: tribunal lacked authority to award pre-award interest under the contract. | García-Vélez: parties agreed to AAA Commercial Arbitration Rules; Rule 43(d)(1) permits pre-award interest. | Within authority; arbitration rules authorize pre-award interest. |
Key Cases Cited
- Raytheon Co. v. Automated Bus. Sys., Inc., 882 F.2d 6 (1st Cir. 1989) (fair hearing requires notice and opportunity to present evidence)
- Hotels Condado Beach, La Concha and Convention Ctr. v. Unión De Tronquistas Local 901, 763 F.2d 34 (1st Cir. 1985) (exclusion of central evidence may warrant vacatur)
- Kashner Davison Sec. Corp. v. Mscisz, 531 F.3d 68 (1st Cir. 2008) (limits on vacatur; cannot reweigh merits; presumptions against relief)
- Georgia-Pacific Corp. v. Local 27, United Paperworkers Int'l Union, 864 F.2d 940 (1st Cir. 1988) (arbitrators' authority and standard of review)
- Prudential-Bache Sec., Inc. v. Tanner, 72 F.3d 234 (1st Cir. 1995) (limits on reconsideration of arbitration decisions)
- Dean v. Sullivan, 118 F.3d 1170 (7th Cir. 1997) (courts do not reevaluate merits decided by arbitrators)
- Zayas v. Bacardí Corp., 524 F.3d 65 (1st Cir. 2008) (arbitrator's written explanations not mandatory)
- United Paperworkers Int'l Union v. Misco, Inc., 484 U.S. 29 (U.S. Supreme Court 1987) (extremely deferential review of arbitration awards)
- Keebler Co. v. Truck Drivers, Local 170, 247 F.3d 8 (1st Cir. 2001) (arbitrator may set procedures within fair process)
- U.S. v. Misco, Inc., 484 U.S. 29 (1987) (emphasizes deference to arbitration)