Increasingly, attention has been directed at the issue of arbitrator impartiality and the duties of participants in the process. A recent federal case from California involved the failure of both an arbitrator and the American Arbitration Association (AAA) to comply with their respective obligations in this regard. See Equicare Health v. Varian Medical Systems, (USDC, N.D. CA, 2023).

Equicare had entered into an agreement with Varian under which Varian had agreed to make a “reasonable commercial effort” to promote and sell Equicare products while Varian was developing a competitive product. Thereafter, Varian’s sales of Equicare products dropped until there were virtually none. Equicare claimed that Varian had breached the agreement by failing to use reasonable commercial efforts to sell Equicare products while promoting its own.