SCOTUS Denies Certiorari in Selden. At Issue: FAA Review of Awards Based on Public Policy

This article first appeared in the Securities Arbitration Alert Blog.

As reported in SAA 2021-19 (May 20), the Supreme Court on May 17 denied Certiorari in Seldin v. Estate of Silverman, 305 Neb. 185 (Mar. 6, 2020), covered previously in SAA 2020-11 (Mar. 18).

There, a unanimous Nebraska Supreme Court held that an arbitration Award cannot be challenged under the Federal Arbitration Act (“FAA”) based on public policy violations. Said the Court: “Prior to 2008, a circuit split existed on whether courts could apply nonstatutory standards when reviewing arbitration awards under the FAA…. In Hall Street Associates, L.L.C. v. Mattel, Inc., the U.S. Supreme Court resolved the split and held that under the FAA, courts lack authority to vacate or modify arbitration awards on any grounds other than those specified in §§ 10 and 11 of the FAA…. Because the U.S. Supreme Court’s decision in Hall Street Associates, L.L.C. abrogated public policy as grounds for vacating an arbitration award under the FAA, we … hold that under the FAA, a court is not authorized to vacate an arbitration award based on public policy grounds because public policy is not one of the exclusive statutory grounds set forth in § 10 of the FAA.”

The questions presented in the denied Petition for Certiorari were: “1. Whether the FAA categorically forecloses courts from vacating an arbitration award on the ground that the award is contrary to public policy. 2. Whether the FAA’s protection against an arbitrator’s ‘evident partiality’ (9 U.S.C. § 10(a)(2)) is triggered when there is a reasonable impression of partiality, or instead by a more heightened standard such as a showing of actual bias.”

(ed: *We’re not surprised. **Selden, No. 20-895, is on page 3 of the Order List.)

George Friedman

George H. Friedman is the publisher and Editor-in-Chief of the Securities Arbitration Alert, a weekly online publication covering the latest developments in financial services arbitration and mediation. He is also the principal of George H. Friedman Consulting, LLC, providing expert advice on arbitration and mediation in general and the FINRA…