Reinsurance Arbitration Award Tossed by Federal Judge for Failure to Disclose Arbitrator Partiality

Hinshaw attorney Scott M. Seaman, a Chicago-based partner and co-chair of the firm's national Insurance Services Practice Group, discussed with Caroline Simson of Law360 a recent decision by a New York federal judge vacating an arbitration award in a reinsurance dispute due to evident partiality by the arbitrator. In the case, it was determined that the appointed arbitrator had failed to disclose certain business relationships he had with the party that ultimately prevailed in the arbitration.

Seaman said that while courts are fairly reluctant to overturn an arbitration award following extensive proceedings, the decision in this case was a good thing for the arbitration process overall. Vacating the arbitration award "focuses parties and panel members on the need for full disclosure and reminds everybody of the potential consequences for conflict," he noted.

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"Arbitrator Partiality Ruling Highlights Disclosure Importance" was published by Law360, April 24, 2017.