Olivier Attia v. Audionamix, Inc. and Audionamix, SA; SDNY 14 CV 0706
Sep 21, 2015OUTCOME: $9,371,378 arbitration award overturned
Attia involved an arbitration administered by the AAA using the then-applicable (2012) employment rules. Those rules did not specifically authorize arbitral sanctioning. However, the rules allowed an a ... rbitrator to apportion fees and expenses and gave the arbitrator broad discretion to interpret and apply the rules concerning an arbitrator's powers and authority. During the discovery process, respondent maintained the claimant had destroyed important evidence and demanded "terminating sanctions." In opposition to the motion, claimant submitted his own affidavit stating to be an expert on spoliation and asserted that technically spoliation was not possible. The arbitrator rejected the affidavit on grounds that as a matter of law expert testimony and/or evidence must come from someone qualified as an expert who is not a party to the proceeding. In addition, the arbitrator opined that the claimant's explanations concerning the alleged spoliation had been "disingenuous at best, and is emblematic of his conduct throughout the discovery process, which has been far from exhibiting good faith." Having refused the affidavit, the arbitrator granted the motion for terminating sanctions and entered a default judgment on a counterclaim for $9,371,378. Judge Berman vacated the award and found the arbitrator guilty of misconduct within the meaning of FAA §10 (a)(3). He noted that the refusal to allow the affidavit resulted in a record containing only unchallenged evidence offered by respondent to prove alleged spoliation of evidence. In his published opinion, Berman identified the arbitrator by her name not once but 38 times.
