Hall Street Blues: The Uncertain Future of Manifest Disregard

Abstract:     
In 2008, in Hall Street Assocs. v. Mattel, Inc., the Supreme Court resolved a then-existing split in the federal circuits and held that parties cannot contractually expand the grounds for judicial review of an arbitration award when invoking the Federal Arbitration Act's vacatur provisions, elevating the finality of arbitration over the parties’ freedom of contract. The Hall Street decision necessarily impacted subsequent jurisprudence regarding parties’ motions to vacate arbitration awards. While the opinion clearly and explicitly barred further contractual expansion of grounds for review, it also avoided and thus left unresolved the issue of whether it would endorse or reject the judicially-crafted “manifest disregard of the law” ground for review of an arbitration award. In the short time since Hall Street, a new circuit split has emerged on the question of whether manifest disregard of the law survives Hall Street as a valid ground to vacate an award under the FAA. Because the scope of permissible judicial review of arbitration awards poses the fundamental policy question of whether and to what degree courts should intervene in the finality of the arbitration process to ensure its integrity, this article explores that question.

Number of Pages in PDF File: 16

Keywords: arbitration, dispute resolution

JEL Classification: K4

Accepted Paper Series