While it may be unethical for an arbitrator to not fully disclose his or her connections to an appointing side of an arbitration, discovering these connections later won’t guarantee that a less-than-ideal award will be vacated, the U.S. Court of Appeals for the Second Circuit ruled in an opinion Thursday.
In Certain Underwriting Members of Lloyd’s of London v. Insurance Company of the Americas, a panel composed of Circuit Judges Dennis Jacobs, Reena Raggi and Peter Hall reversed a district judge’s decision to vacate an arbitration award. The panel remanded the case, finding it appropriate to vacate an award on evident partiality grounds if the relationship “violates the contractual requirement of disinterestedness,” or if the arbitrator’s undisclosed relationships clearly affect the award.
