Kolel Beth Yechiel Mechil of Tartikov, Inc. v. YLL Irrevocable Trust
878 F. Supp. 2d 459
S.D.N.Y.2012Background
- Kolel and YLL/Kochav dispute ownership of 43 life insurance policies sold under a Purchase Agreement with premium obligations and equal division of death benefits.
- Kolel alleged premium nonpayment caused lapse; Kolel sued in Oct 2011 seeking transfer of policies and injunctive relief.
- An Arbitration Agreement (Jan 12, 2012; amended Feb 7, 2012) provided a three-member rabbinical panel to resolve the dispute with broad discretion and limited disclosure requirements.
- The Panel held 7–8 sessions, issued the Award on April 10, 2012 transferring the Policies to Kolel; two arbitrators signed, one abstained.
- Trust Defendants sought vacatur in state court; the case was removed to this Court; May 25, 2012 Order directed Trust Defendants to show cause regarding confirmation.
- The Court applies FAA and Convention standards, granting Kolel’s motion to confirm and denying vacatur due to lack of demonstrated grounds.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Award can be vacated for evident partiality or corruption | Trust Defendants contend Kaufman biased toward Kolel. | Kolel argues no clear bias or corrupt motive; evidence insufficient. | Vacatur denied; no evident partiality or corruption proven. |
| Whether the Award can be vacated for arbitrator misconduct in hearings | Trust Defendants claim premature decision and restricted evidence due to misconduct. | Kolel argues arbitration flexible; limited record; proceedings were adequate. | Vacatur denied; no fundamental fairness violation shown. |
| Whether the Award can be vacated under Convention Article V(2)(b) for public policy | Trust Defendants assert the Award violates public policy. | Kolel maintains award aligns with contract interpretation and policies. | Vacatur denied; no public policy violation shown. |
Key Cases Cited
- Tempo Shain Corp. v. Bertek, Inc., 120 F.3d 16 (2d Cir. 1997) (arbitration review is narrowly limited; deference to panel)
- Zeiler v. Deitsch, 500 F.3d 157 (2d Cir. 2007) (FAA standards; deference to arbitration panels)
- Telenor Mobile Comm’cs AS v. Storm LLC, 584 F.3d 396 (2d Cir. 2009) (public policy grounds construed narrowly)
- Hall Street Assocs. v. Mattel, Inc., 552 U.S. 576 (U.S. 2008) (establishes comprehensive framework for vacatur/confirmation)
- D.H. Blair & Co. v. Gottdiener, 462 F.3d 95 (2d Cir. 2006) (high burden to avoid confirmation under FAA)
- Scandinavian Reinsurance Co. v. Saint Paul Fire & Marine Ins. Co., 668 F.3d 60 (2d Cir. 2012) (evident partiality standard; objective facts matter)
- Morelite Constr. Corp. v. NYC Dist. Council Carpenters Benefit Funds, 748 F.2d 79 (2d Cir. 1984) (partiality can be inferred from objective factors)
- Karppinen v. Karl Kiefer Mach. Co., 187 F.2d 32 (2d Cir. 1951) (abundantly clear standard for §10(a)(1) vacatur)
- Sanford Home for Adults v. Local 6, IFHP, 665 F.Supp. 312 (S.D.N.Y. 1987) (bias proof must be direct, definite, capable of demonstration)
- Feifer v. Prudential Ins. Co., 306 F.3d 1202 (2d Cir. 2002) (contract interpretation may inform arbitration grounds)