Thank You For Submiting Feedback!
There is no general requirement that arbitrators explain the reasons for their award.
Appellee customer brought an action in district court to vacate an arbitration decision in favor of appellant broker under 9 U.S.C.S. § 10. Appellant was granted an interlocutory review under 28 U.S.C.S. § 1292(b), after the district court remanded the case to the arbitrators to state the basis of their decision. The district court held that absent that statement, it could not be determined whether the arbitrators' decision was in "manifest disregard" of the applicable securities laws.
Did the arbitrators have an obligation to explain the basis of their decision?
On appeal, the court reversed the order. The court noted that arbitrators are not required in the first instance to state the basis for their opinions, and found nothing in this particular case to justify the extraordinary requirement of the district court's order.