Southern District of New York Holds That Arbitrator’s Refusal to Postpone Hearing and Consider Witnesses Not “Misconduct” Requiring Vacatur
The petitioner moved to confirm an arbitration award, and the respondent cross-moved to vacate, claiming the arbitrator was guilty of misconduct in refusing to postpone the hearing upon the unexpected passing of a witness’ father, then refusing to consider testimony of a different witness, and for showing manifest disregard of the law. The court explained that litigants carry a heavy burden when seeking to vacate an award based on arbitrator misconduct, noting that not every failure to consider relevant evidence requires vacatur. Only when an arbitrator refuses to accept evidence from a “key witness,” such that the opposition’s critical arguments would go unopposed, would the misconduct rise to the level ordinarily required for vacatur. Here, the respondent essentially admitted that one of the excluded witnesses was not “key” and that the other was meant only to corroborate the respondent’s own evidence, rather than rebut the petitioner’s. For these and other reasons, the court held that the arbitrator’s refusal to consider these witnesses was not improper, much less misconduct requiring vacatur. The court also found no evidence to suggest that this was one of the “exceedingly rare” instances in which an award may be vacated for manifest disregard of the law. The court therefore granted the petitioner’s motion to confirm the award, and denied the respondent’s cross-motion.
Eaton Partners, LLC v. Azimuth Capital Mgmt. IV, Ltd., No. 1:18-cv-11112 (S.D.N.Y. Oct. 18, 2019),