Arbitration is supposed to be easier and faster than litigation. But the ongoing battle between Mattel Inc. and Hall Street Associates proves it has the potential to be anything but. What should have been a relatively simple landlord-tenant dispute resolved after a weeklong hearing by an arbitrator has taken three tangled trips through the federal court system over the course of nearly eight years, finally landing on the Supreme Court’s October 2007 docket.
In Hall Street Associates v. Mattel the Supreme Court will decide a relatively bland legal issue–whether the terms of the Federal Arbitration Act (FAA) preclude companies from agreeing to expanded grounds for judicial review of an arbitration award outside of the four narrow bases for such review the FAA sets forth. The 9th Circuit had ruled that FAA did preclude such agreements. As the Supreme Court determines that issue and finally puts Hall Street and Mattel’s battle to rest, the future of arbitration as a viable way to resolve important commercial disputes hangs in the balance.
