Hall St. Assocs., L.L.C. v. Mattel, Inc.

Hall St. Assocs., L.L.C. v. Mattel, Inc.

Supreme Court of the United States

November 7, 2007, Argued; March 25, 2008, Decided

No. 06-989


 [*578]  [**1400] Justice Souter delivered the opinion of the Court.1

HN1[] LEdHN[1][] [1] The Federal Arbitration Act (FAA or Act), 9 U.S.C. § 1 et seq., provides for expedited judicial review to confirm, vacate, or modify arbitration awards. §§ 9-11 (2006 ed.)2  The question here is whether statutory grounds for prompt vacatur and modification may be supplemented by contract. We hold that the statutory grounds are exclusive.

 [*579]  I

This case began as a lease dispute between landlord, petitioner Hall  [***260] Street Associates, L. L. C., and tenant, respondent Mattel, Inc. The property was used for many years as a manufacturing site, and the leases provided that the tenant would indemnify the landlord for any costs resulting from the failure of the tenant or its predecessor lessees to follow environmental laws while using the premises. App. 88-89.

Tests of the property's well water in 1998 showed high levels of trichloroethylene (TCE), the apparent residue of manufacturing discharges by Mattel's predecessors between 1951 and 1980. After the Oregon Department of Environmental  [****9] Quality (DEQ) discovered even more pollutants, Mattel stopped drawing from the well and, along with one of its predecessors, signed a consent order with the DEQ providing for cleanup of the site.

After Mattel gave notice of intent to terminate the lease in 2001, Hall Street filed this suit, contesting Mattel's right to vacate on the date it gave, and claiming that the lease obliged Mattel to indemnify Hall Street for costs of cleaning up the TCE, among other things. Following a bench trial before the United States District Court for the District of Oregon, Mattel won on the termination issue, and after an unsuccessful try at mediating the indemnification claim, the parties proposed to submit to arbitration. The District Court was amenable, and the parties drew up an arbitration agreement, which the court approved and entered as an order. One paragraph of the agreement provided that

"[t]he United States District Court for the District of Oregon may enter judgment upon any award, either by confirming the award or by vacating, modifying or correcting the award. The Court shall vacate, modify or correct any award: (i) where the arbitrator's findings of facts are not supported by substantial  [****10] evidence, or (ii) where the [**1401]  arbitrator's conclusions of law are erroneous." App. to Pet. for Cert. 16a.

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552 U.S. 576 *; 128 S. Ct. 1396 **; 170 L. Ed. 2d 254 ***; 2008 U.S. LEXIS 2911 ****; 76 U.S.L.W. 4168; 2008 AMC 1058; 21 Fla. L. Weekly Fed. S 121


Subsequent History: On remand at, Remanded by Hall St. Assocs. v. Mattel Inc., 531 F.3d 1019, 2008 U.S. App. LEXIS 14490 (9th Cir. Or., July 8, 2008)


Hall St. Assocs., L.L.C. v. Mattel, Inc., 196 Fed. Appx. 476, 2006 U.S. App. LEXIS 19527 (9th Cir. Or., 2006)

Disposition: 196 Fed. Appx. 476, vacated and remanded.

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Business & Corporate Compliance, Pretrial Matters, Alternative Dispute Resolution, Judicial Review, Civil Procedure, Arbitration, Federal Arbitration Act, General Overview, Scope, Governments, Legislation, Interpretation