Rare Vacatur in Arbitration Appeal

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I've been involved in a number of arbitrations in my career, both as lead counsel at the hearing stage and in post-hearing proceedings challenging the award. I've learned to tell clients that the time to win the case is at the arbitration hearing, because the chances of getting a trial judge or an appellate panel to change the outcome later are slim.

The Dallas Court of Appeals recently declined to rubber stamp an arbitration result in Alim v. KBR (Kellogg, Brown & Root)-Halliburton (No. 05-09-00395-CV). The Court vacated an award under 9 U.S.C. § 10(a)(2) because "the arbitrator failed to disclose facts which might, to an objective observer, create a reasonable impression of the arbitrator's partiality." More specifically, he did not reveal that he had served as an arbitrator in a prior case involving KBR's party representative and a related company.

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