Conflicts of interest are of great interest to law firms, prosecutors and arbitrators. In two major international arbitrations, parties are seeking review by the U.S. Supreme Court of the standard that courts should apply when considering whether to vacate an arbitration award based on an alleged conflict of interest. The cases are important not only because of the large size of the awards at issue, but also because arbitration is the preferred method by which the world’s commercial disputes are being resolved.

U.S. courts are divided on how they should apply the “evident partiality” standard contained in the Federal Arbitration Act, which must be demonstrated in order to vacate an arbitration award based on an arbitrator’s alleged conflict of interest. Five circuit courts follow the U.S. Court of Appeals for the Second Circuit standard requiring an award to be vacated only if a court would have to conclude an arbitrator was partial. The Ninth Circuit requires only a reasonable impression of possible bias and the Eleventh Circuit articulates the Second Circuit standard, but applies the Ninth Circuit standard. The litigants petitioning for certiorari arise in different procedural postures, but both cases request clarification of the standard.