Andros Compania Maritima, S.A. v. Marc Rich & Co., A.G

In Andros Compania Maritima, S.A. v. Marc Rich & Co., A.G., 579 F.2d 691 (2d Cir. 1978), Marc Rich & Co. was the losing party in an arbitration and thereafter investigated the neutral arbitrator's prior service. Based on that investigation, Marc Rich moved to vacate the award and offered an affidavit to the trial court that showed that the prevailing party's non-neutral arbitrator, Nelson, had participated in appointing the neutral arbitrator, Arnold, as a neutral arbitrator in nineteen other arbitrations. In each of those nineteen cases, Arnold voted the same way as Nelson. The trial court refused to vacate the award. On appeal Marc Rich complained that it had not been given an adequate opportunity to show why the arbitration award should be set aside. The Second Circuit observed that at first blush, Marc Rich's request "seemed reasonable, particularly in light of the broad discovery usually allowed in the federal courts." But it nevertheless upheld the district court's confirmation of the arbitration award without further proceedings. The circuit court articulated three grounds for doing so. First, it reiterated its holding in Cook 19 that an arbitrator is only required to disclose "'dealings of which the parties cannot reasonably be expected to be aware.'" Second, it did not regard the undisclosed information "as the sort of information an arbitrator would reasonably regard as creating an impression of possible bias." Third, the Second Circuit concluded that Arnold's and Nelson's "service together on arbitration panels was no secret" since Marc Rich was able to obtain this information after "'an exhaustive review of approximately 1200 published awards of the Society of Maritime Arbitrators.'" Marc Rich, the court said, "could have made such a review just as easily before or during the arbitration rather than after it lost its case."