Standard Security Life Insuran v. FCE Benefit Administrators, In, 967 F.3d 667

Standard Security Life and Madison National (Insurers) contracted with FCE to administer health-insurance policies; arbitration clause governed disputes, with a carve-out for indemnity disputes tied to Section 17/19.
Insurers terminated the agreement and demanded arbitration in 2017–2018, alleging breach (failure to remit premiums, mishandled claims, excessive fees, regulatory fines); FCE counterclaimed for wrongful termination.
The tribunal bifurcated the arbitration into Phase I (discrete claims heard Sept–Nov 2018) and Phase II (new/remaining claims heard Feb 2019).
Phase I Partial Final Award (Dec 31, 2018) awarded Insurers about $5.35 million; Phase II Final Award (Mar 11, 2019) denied several remaining claims.
Insurers sought confirmation in federal court; an initial confirmation attempt was dismissed as unripe (district court unaware Phase II award had been entered), then the court confirmed both Phase I and Phase II awards. FCE appealed confirmation of the Phase I award.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether Phase II superseded Phase I so only Phase II could be confirmed	Phase II is the only final adjudication; its "all other claims denied" language revokes Phase I	Phase I was a "Partial Final Award" disposing finality of Phase I claims; Phase II addressed distinct claims	Phase II did not supersede Phase I; Phase I was final as to Phase I claims and properly confirmable
Whether arbitrators exceeded authority by deciding indemnity (Section 17) claims	Insurers: disputes under Section 17 were arbitrable because neither party invoked Section 19; tribunal could decide them	FCE: Section 18/19 carved indemnity disputes out of arbitration and made Texas courts exclusive; Insurers should have sued in court	Court held Section 19 is permissive; because neither party invoked litigation and FCE did not timely object, arbitrators had authority; waiver/AAA rules support arbitrability
Whether award labeled "Embezzlement" exceeded arbitrator power or violated due process	Insurers: label reflected excessive/unearned fee claim under the Agreement; FCE had notice and defended	FCE: embezzlement is a criminal matter outside contract scope and was not pleaded; label surprised FCE and violated due process	Tribunal merely resolved a contract-fee dispute under the Agreement; term "embezzlement" was rhetorical and not beyond arbitral authority; no due-process violation found

Baravati v. Josephthal, Lyon & Ross, Inc., 28 F.3d 704 (7th Cir. 1994) (judicial review of arbitration awards is narrowly limited)
Hasbro, Inc. v. Catalyst USA, Inc., 367 F.3d 689 (7th Cir. 2004) (confirmation of arbitration awards is typically routine)
First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938 (1995) (arbitration awards set aside only in very unusual circumstances)
Butler Mfg. Co. v. United Steelworkers of Am., 336 F.3d 629 (7th Cir. 2003) (courts enforce arbitrator’s award unless arbitrator exceeded delegated authority)
Anderson v. Norfolk & W. Ry. Co., 773 F.2d 880 (7th Cir. 1985) (distinguishing when a partial award is not intended to be final)
AO Techsnabexport v. Globe Nuclear Servs. & Supply GNSS, Ltd., [citation="404 F. App'x 793"] (4th Cir. 2010) (partial awards not confirmable if not final on severable claims)
AGCO Corp. v. Anglin, 216 F.3d 589 (7th Cir. 2000) (party that submits an issue to arbitration cannot later claim arbitrator lacked authority)
Hill v. Norfolk & W. Ry. Co., 814 F.2d 1192 (7th Cir. 1987) (court asks whether arbitrator interpreted the contract, not whether interpretation was correct)
Olson v. Wexford Clearing Servs. Corp., 397 F.3d 488 (7th Cir. 2005) (assessing finality of arbitration awards)
Kochert v. Adagen Med. Int’l, Inc., 491 F.3d 674 (7th Cir. 2007) (forum-selection/jurisdiction clauses can be permissive rather than mandatory)