Giller v. Oracle USA, Inc.
Filing
29
MEMORANDUM OPINION AND ORDER re: 5 MOTION to Dismiss the Petition filed by Oracle USA, Inc.: For the reasons set forth within, Oracle's motion to dismiss certain portions of the petition is granted. The arbitration award is confirmed in its entirety. The Clerk is directed to enter Judgment and to close this case. The Clerk is directed to close all pending motions. (Signed by Judge John G. Koeltl on 2/13/2012) (ab)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
────────────────────────────────────
JAMES GILLER,
Plaintiff/Petitioner,
11 Civ. 02456 (JGK)
- against -
MEMORANDUM OPINION
AND ORDER
ORACLE USA, INC.,
Defendant/Respondent.
────────────────────────────────────
JOHN G. KOELTL, District Judge:
The plaintiff/petitioner, James Giller, brought this
petition to confirm in part and vacate in part an arbitration
award that resolved an employment dispute between Giller and his
former employer, the defendant/respondent, Oracle USA.
Oracle
now moves pursuant to Federal Rule of Civil Procedure 12(b)(6)to
dismiss the claims in the petition that seek to vacate the parts
of the award that were favorable to Oracle.
The Court has
subject matter jurisdiction in this case pursuant to 28 U.S.C. §
1332.
I.
In deciding a motion to dismiss pursuant to Rule 12(b)(6),
the allegations in the Complaint are accepted as true, and all
reasonable inferences must be drawn in the plaintiff's favor.
McCarthy v. Dun & Bradstreet Corp., 482 F.3d 184, 191 (2d Cir.
2007).
The Court's function on a motion to dismiss is “not to
weigh the evidence that might be presented at a trial but merely
to determine whether the complaint itself is legally
sufficient.”
1985).
Goldman v. Belden, 754 F.2d 1059, 1067 (2d Cir.
The Court should not dismiss the Complaint if the
plaintiff has stated “enough facts to state a claim to relief
that is plausible on its face.”
U.S. 544, 570 (2007).
Bell Atl. Corp. v. Twombly, 550
“A claim has facial plausibility when the
plaintiff pleads factual content that allows the court to draw
the reasonable inference that the defendant is liable for the
misconduct alleged.”
(2009).
Ashcroft v. Iqbal, 129 S.Ct. 1937, 1949
While the Court should construe the factual allegations
in the light most favorable to the plaintiff, “the tenet that a
court must accept as true all of the allegations contained in
the Complaint is inapplicable to legal conclusions.”
Id.
When presented with a motion to dismiss pursuant to Rule
12(b)(6), the Court may consider documents that are referenced
in the Complaint, documents that the plaintiffs relied on in
bringing suit and that are either in the plaintiff’s possession
or that the plaintiff knew of when bringing suit, or matters of
which judicial notice may be taken.
See Chambers v. Time
Warner, Inc., 282 F.3d 147, 153 (2d Cir. 2000); see also City of
Roseville Emps.’ Ret. Sys. v. Energysolutions, Inc., No. 09 Civ.
8633, 2011 WL 4527328 at *1-2 (S.D.N.Y. Sept. 30, 2011).
2
II.
The following allegations are assumed to be true for the
purposes of this motion unless otherwise stated.
Giller worked as Consulting Sales Manager for Oracle
between February 2005 and April 2008.
(Pet. to Confirm in Part
& Vacate in Part the Arb. Award ¶ 1; Pet. Ex. A (“Award”), at
2.)
Giller worked on a long-term master technology agreement
between Oracle and the City University of New York (“CUNY”) that
closed on May 31, 2007.
(Award, at 3-4.)
Although the parties
expected that the agreement eventually would involve $135
million of sales for Oracle, this was merely a projection of the
contract’s potential value.
(Award, at 3-4; Pet. ¶ 9.)
CUNY,
as a public institution, could not sign a contract that bound it
for longer than one year.
(Pet. ¶ 9.)
The $135 million
represents the projected value of CUNY’s expected purchases over
five or six years.
(Award, at 4; Pet. ¶ 9.)
In 2007, CUNY
purchased $20 million worth of services from Oracle. (Award, at
4; Pet. ¶ 9.)
Although both Oracle and CUNY expected that CUNY
would sign purchase orders in each of the following four or five
years, CUNY was not obligated to do so and there was no such
guarantee.
(Award, at 4; Pet. ¶ 9.)
As a Consulting Sales Manager, Giller received commissions
for sales that he booked at a rate determined annually by
3
Oracle.
(Award, at 4; Pet. ¶ 6; Decl. of Gary M. Meyers in Opp.
to Mot. to Dismiss Pet. (“Meyers Decl.”) Ex. 2A (“Compensation
Plan”), at 3-20.)
Giller received commissions from the 2007
CUNY transaction based not on the $135 million that included all
expected future sales, but on $18 million of the initial $20
million purchase.
(Award, at 4.)
After the close of its 2007
fiscal year, Oracle placed a retroactive cap on the amount of
money Giller could receive as payment for commissions for that
year.
(Award, at 7-9, 12; Pet. ¶ 10.)
For the year following Giller’s booking of the CUNY
transaction, Oracle significantly increased Giller’s sales
target, which resulted in a decrease in his commission rate.
(Award, at 15-16.)
territory.
Oracle also reduced Giller’s sales
(Pet. ¶ 20.)
Giller also alleges that his managers
treated him poorly, that Oracle wished to “manage him out of the
company,” and that Giller was not a part of their long range
plans.
2008.
(Pet. ¶¶ 22-25.)
Giller resigned from Oracle in April
(Pet. ¶ 25.)
Giller’s employment relationship with Oracle was governed
by a broad Employment Agreement and Mutual Agreement to
Arbitrate.
(Decl. of Christopher J. Collins in Supp. of Mot. to
Dismiss Ex. 2 (“Agreement”).)
That Agreement, which is dated
January 16, 2005, provides:
4
You and Oracle understand and agree that any existing
or future dispute or claim arising out of or related
to your Oracle employment, or the termination of that
employment, will be resolved by final and binding
arbitration and that no other forum for dispute
resolution will be available to either party, except
as to those claims identified below. The decision of
the arbitrator shall be final and binding on both you
and Oracle and it shall be enforceable by any court
having proper jurisdiction.
(Agreement.)
None of the exceptions to arbitration applied, and
Giller submitted his employment dispute to an arbitrator in an
Employment Arbitration Tribunal of the American Arbitration
Association as provided for in the Agreement.
Giller filed three claims against Oracle in the
arbitration.
(Meyers Decl. Ex. 2 (“Stmt. of Claim”) ¶¶ 17-31.)
The first claim for fraudulent inducement was dismissed by the
arbitrator on summary judgment and is not at issue here.
(Award, at 1.)
Giller’s second claim sought to recover
commission payments on the entirety of the potential $135
million purchase order with CUNY.
(Stmt. of Claim ¶¶ 22-26.)
Giller claimed that the failure to pay him a commission on the
entire amount of $135 million was a breach of contract or a
breach of the implied covenant of good faith and fair dealing.
(Statement of Claim ¶¶ 22-26.)
Giller’s third claim sought to
recover for discrimination on the basis of age.
Claim ¶¶ 27-31.)
(Statement of
Giller argued that the increased sales target
and resulting decreased rate of commission, and other actions
5
undertaken by Oracle created an intolerable work atmosphere that
amounted to constructive discharge.
15.)
(Statement of Claim ¶¶ 9-
Giller alleged that this adverse employment action was
motivated by discrimination on the basis of his age.
(Statement
of Claim ¶¶ 27-31.)
In a thorough decision, following a three day evidentiary
hearing, the arbitrator found that the retroactive cap placed on
Giller’s commissions constituted a breach of contract and
awarded him $99,355.
(Award, at 12-13.)
However, the
arbitrator found in favor of Oracle on the remainder of Giller’s
contract claim, including Oracle’s determination that Giller was
not entitled to receive a commission for the higher, projected
amount of the CUNY transaction until Oracle actually “booked” a
CUNY payment for that amount.
(Award, at 12.)
The arbitrator
found that Oracle’s Compensation Plan entitles Consulting Sales
Managers to receive commissions when the client executes a
purchase order and that Oracle does not pay commissions for
future or expected purchases.
(Award, at 13.)
While the
arbitrator agreed that Oracle breached its contract with Giller
by retroactively reducing the commission he actually earned for
2007, the arbitrator found that the Compensation Plan between
the parties allowed Oracle to change an employee’s sales target
and commission rate before and during a given fiscal year.
(Award, at 12, 15-18.)
6
The arbitrator also found the evidence insufficient to
establish that Giller experienced either an adverse employment
action or discrimination on the basis of age.
22.)
(Award, at 21-
The arbitrator found that Giller’s work environment was
not “so intolerable that a reasonable person in his
circumstances would be compelled to resign.”
(Award, at 21.)
The arbitrator also found “no persuasive evidence in the record
to demonstrate that the actions [Oracle] took against [Giller]
were the result of discrimination on the basis of age.”
(Award,
at 22.)
Giller filed suit in this Court seeking to vacate the
arbitration award with respect to the arbitrator’s findings on
the amount of commissions owed to him and on his age
discrimination claim, and confirming the portion of the award
that awarded him $99,355.
III.
The task for a party seeking to vacate an arbitration award
is a formidable one.
The party challenging an arbitration award
generally bears a heavy burden of proof, and courts generally
will conduct only limited review of arbitration decisions.
See,
e.g., Willemijn Houdstermaatschappij, BV v. Standard Microsys.
Corp., 103 F.3d 9, 12 (2d Cir. 1997) (“Arbitration awards are
7
subject to very limited review in order to avoid undermining the
twin goals of arbitration, namely, settling disputes efficiently
and avoiding long and expensive litigation.”(alterations
omitted)); In re Arbitration Between Space Sys./Loral, Inc. v.
Yuzhnoye Design Office, 164 F. Supp. 2d 397, 403 (S.D.N.Y. 2001)
(“[L]imited review of arbitration decisions is necessary both to
effectuate the parties’ agreement to submit their disputes to
arbitration and to avoid costly and protracted litigation about
issues the arbitrators have already decided.”); see also
Hamilton v. Sirius Satellite Radio, Inc., 375 F. Supp. 2d 269,
273 (S.D.N.Y. 2005).
The parties acknowledge that the arbitration agreement in
this case is governed by the Federal Arbitration Act, 9 U.S.C. §
1 et seq., (the "FAA").
The FAA authorizes a district court to
vacate an arbitration award on four statutory grounds, including
“where there was evident partiality or corruption in the
arbitrators . . . [or] where the arbitrators exceeded their
powers, or so imperfectly executed them that a mutual, final,
and definite award upon the subject matter submitted was not
made.”
9 U.S.C. § 10(a)(2);(4); see also Stolt-Nielsen SA v.
AnimalFeeds Int'l Corp., 548 F.3d 85, 90-94 (2d Cir. 2008) rev’d
on other grounds, 130 S.Ct. 1758 (2010).
An arbitration award also may be vacated if it constitutes
“manifest disregard” of the law.
Telenor Mobile Commc'ns AS v.
8
Storm LLC, 584 F.3d 396, 407 (2d Cir. 2009); Stolt-Nielsen, 548
F.3d at 91-94.
The Court of Appeals for the Second Circuit has
explained that the “manifest disregard” doctrine can be
“reconceptualized as a judicial gloss on the specific grounds
for vacatur enumerated in section 10 of the FAA.”
Nielsen, 548 F.3d at 94. 1
Stolt-
The Court of Appeals has repeatedly
emphasized that review of an arbitration award for manifest
disregard of the law is “severely limited,” and “to modify or
vacate an award on this ground, a court must find both that (1)
the arbitrators knew of a governing legal principle yet refused
to apply it or ignored it altogether, and (2) the law ignored by
the arbitrators was well defined, explicit, and clearly
applicable to the case.”
Halligan v. Piper Jaffray, Inc., 148
F.3d 197, 202 (2d Cir. 1998) (internal quotations omitted); see
also Duferco Int’l Steel Trading v. T. Klaveness Shipping A/S,
333 F.3d 383, 389-91 (2d Cir. 2003); Hamilton, 375 F. Supp. 2d
at 273 (S.D.N.Y. 2005).
Review under the doctrine of manifest disregard of the law
is not an inquiry into the correctness of the decision, and the
“erroneous application of rules of law is not a ground for
vacating an arbitrator’s award, nor is the fact that an
arbitrator erroneously decided the facts.”
1
Siegel v. Titan
The Supreme Court has left open the question whether “manifest disregard”
survives as an independent ground for judicial review or as a judicial gloss
on the enumerated grounds for vacatur in 9 U.S.C. § 10. Stolt-Nielsen, 130
S.Ct. at 1768 n.3.
9
Indus. Corp., 779 F.2d 891, 892-93 (2d Cir. 1985) (citations
omitted); see Merrill Lynch, Pierce, Fenner & Smith, Inc. v.
Bobker, 808 F.2d 930, 933-34 (2d Cir. 1986)(explaining that a
court is “not at liberty to set aside an arbitration panel’s
award because of an arguable difference regarding the meaning or
applicability of laws urged upon it”).
Instead, the error must
be “plainly evident from the arbitration record,” Duferco, 333
F.3d at 388, such that it is “obvious and capable of being
readily and instantly perceived by the average person qualified
to serve as an arbitrator,” Bobker, 808 F.2d at 933; see also
Hamilton, 375 F. Supp. 2d at 273-74 (S.D.N.Y. 2005).
The arbitration decision must be confirmed if there is
“even a barely colorable justification for the outcome reached.”
In re Arbitration Between Andros Compania Maritima and Marc Rich
& Co., A.G., 579 F.2d 691, 703-04 (2d Cir. 1978).
Vacating an
award for manifest disregard of the law is appropriate “only in
those exceedingly rare instances where some egregious
impropriety on the part of the arbitrators is apparent.”
Stolt-
Nielsen, 548 F.3d at 91-92 (internal quotation marks omitted);
see also Hamilton, 375 F. Supp. 2d at 274.
Moreover, the Court
of Appeals has made it clear that it does not “recognize
manifest disregard of the evidence as a proper ground for
vacating an arbitration award.”
Stolt-Nielsen, 548 F.3d at 91.
Accordingly, between 1960 and the Duferco decision in 2003,
10
the Court of Appeals for the Second Circuit has vacated some or
all of an arbitral award for manifest disregard of the law in
only four of at least forty-eight cases.
389.
Duferco, 333 F.3d at
This is because interference with arbitration awards would
“thwart the usefulness or arbitration, making it the
commencement, not the end, of litigation.”
Id.
(internal
quotation marks omitted); see Wallace v. Buttar, 378 F.3d 182,
191 (2d Cir. 2004) (describing the “sobering odds” of prevailing
on a manifest disregard argument). 2
IV.
A.
Giller seeks to vacate the portion of the arbitration award
denying his age discrimination claim on the basis that it
evidences a manifest disregard of the law.
Giller claims he
suffered an adverse employment action, motivated by
discrimination on the basis of age.
(Award, at 18.)
The
adverse employment action alleged by Giller was constructive
discharge.
(Award, at 18.)
Here, the Petition fails to plead facts sufficient to state
a claim for vacatur under the manifest disregard standard.
Despite Giller’s allegations, the Petition identifies no legal
2
In Stolt-Nielsen, the Court of Appeals updated the statistics. It noted
that since Duferco, the Court of Appeals has vacated one award, and remanded
two others for clarification, while declining to do either in fifteen cases.
Stolt-Nielsen, 548 F.3d at 91-92 n.7.
11
standard that the arbitrator failed to apply.
The arbitrator
plainly applied the correct legal standard to determine whether
Giller had been subjected to a constructive discharge.
See,
e.g., Pa. State Police v. Suders, 542 U.S. 129, 147 (2004) (“A
plaintiff who advances [a constructive discharge] claim must
show working conditions so intolerable that a reasonable person
would have felt compelled to resign.”).
The Petition instead
argues that the arbitrator erred in applying the standard for
constructive discharge to her findings of fact.
29.)
(Pet. ¶¶ 26-
However, this is simply a challenge to the arbitrator’s
findings of fact, which is not a basis to vacate the award.
The
arbitrator, after considering the credibility of the witnesses,
concluded that Giller had failed to establish the necessary
elements for a claim of constructive discharge or indeed a claim
that he was the victim of age discrimination.
Far from being
conclusions that were in manifest disregard of the law, the
conclusions were reasonable conclusions from the factual record.
Therefore, Oracle’s motion to dismiss Giller’s petition to
vacate the denial of his age discrimination claim is granted.
B.
Giller next alleges that the arbitrator manifestly
disregarded clearly applicable principles of contract
interpretation that resulted in an incorrect construction of the
parties’ Compensation Plan.
(Pet. ¶ 30.)
12
The Petition alleges
that the arbitrator knew of and intentionally disregarded the
rules of contract interpretation established by the New York
Court of Appeals by consulting extrinsic evidence to interpret
allegedly unambiguous terms in the parties’ Compensation Plan.
(Pet. ¶ 30.)
Under New York law, “a written agreement that is
complete, clear and unambiguous on its face must be enforced
according to the plain meaning of its terms.”
Greenfield v.
Philles Records, Inc., 780 N.E.2d 166, 170 (N.Y. 2002).
Extrinsic evidence of the parties' intent may not be considered
unless the agreement’s terms are reasonably susceptible to more
than one meaning.
Id.
A petitioner seeking judicial review of an arbitrator’s
interpretation of a contract faces an especially heavy burden.
The Court of Appeals for the Second Circuit has suggested that
an arbitrator’s contractual interpretation is beyond the scope
of judicial review for manifest disregard of the law.
See,
e.g., Westerbeke Corp. v. Daihatsu Motor Co., Ltd., 304 F.3d
200, 214 (2d Cir. 2002) (Sotomayor, J.) (“The arbitrator’s
factual findings and contractual interpretation are not subject
to judicial challenge, particularly on our limited review of
whether the arbitrator manifestly disregarded the law.”); Yusuf
Ahmed Alghanim & Sons v. Toys ‘R’ Us, Inc., 126 F.3d 15, 25 (2d
Cir. 1997) (“Interpretation of . . . contract terms is within
the province of the arbitrator and will not be overruled simply
13
because we disagree with that interpretation.”).
A petition
alleging that the arbitrator failed to apply a clearly
applicable principle of contract interpretation similarly has
been found to exceed the scope of judicial review under the
manifest disregard standard.
See, e.g., Sempra Energy v. Nat’l
Union Fire Ins. Co. of Pittsburgh, Pa., No. 06 Civ. 6107, 2006
WL 3147155, at *2 (S.D.N.Y. Oct. 31, 2006) (“‘[M]isapplication
of rules of contract interpretation does not rise to the stature
of a manifest disregard of law.’”
(alterations omitted)
(quoting I/S Stavborg v. Nat’l Metal Converters, Inc., 500 F.2d
424, 431 (2d Cir. 1974)) (internal quotation marks omitted).
Giller asks this Court to vacate the arbitration award because
of the arbitrator’s alleged misapplication of the New York parol
evidence rule.
of the law.
Such claims do not constitute manifest disregard
See I/S Stavborg, 500 F.2d at 431-32; Sempra
Energy, 2006 WL 3147155 at * 2.
In any event, Giller’s claims have no merit.
Giller
contends that the arbitrator misinterpreted the provision in his
Compensation Plan relating to “multiple transactions to a single
customer, grouped together for special discount approvals and
offerings.”
(Pet. ¶ 14.)
He contends that the entire CUNY
project should have been covered by this provision and included
in the computation of his commissions for the 2007 fiscal year.
He argues that because the provision was unambiguous, it was
14
manifest disregard of the law to consider testimony about its
meaning and application.
There was no error, much less a
manifest disregard of the law.
The arbitrator could reasonably
have concluded that the language was not unambiguous, and the
arbitrator’s ultimate conclusion that it did not apply to the
CUNY project was amply supported.
Similarly, Giller complains that Oracle should not have
included amounts for the CUNY project in his sales target for
the 2008 fiscal year, because this was a misinterpretation of
the sales targets described in his Compensation Plan.
The
arbitrator did not explicitly consider extrinsic evidence in her
interpretation of the sales target provision of the Compensation
Plan.
Rather, she examined the meaning of the provision within
the context of the entirety of the agreement.
In any event, it
cannot be said that the arbitrator’s interpretation of the
Compensation Plan was unreasonable, much less that it was so
unreasonable as to rise to the level of manifest disregard of
the law.
V.
Giller argues that it was manifest disregard of the law and
a violation of section 10(a)(4) of the FAA for the arbitrator
not to consider whether Oracle breached the implied covenant of
15
good faith and fair dealing by failing to pay him commissions
for the CUNY project beyond the $99,355 ordered by the
arbitrator.
(Pet. ¶ 30.)
The arbitrator specifically found
that Oracle was correct in not including the entire $135 million
as a basis for compensation in fiscal year 2007, and that Oracle
did not breach its contract with Giller by increasing his sales
target in the subsequent year, which had the effect of reducing
his commission rate.
(Award, at 12-18.)
Thus, the arbitrator
found that these actions were consistent with the Compensation
Plan.
Giller now contends that the arbitrator simply ignored
his separate claim for breach of the implied covenant of good
faith and fair dealing.
Giller had, in fact, pleaded his breach
of contract and breach of the implied covenant of good faith and
fair dealing as the same second claim for relief based on the
same facts.
There was, in any event, no error in the
arbitrator’s rejection of the claim for breach of the implied
covenant of good faith and fair dealing, and certainly no
manifest disregard of the law, or a violation of section
10(a)(4).
The implied covenant of good faith and fair dealing, which
is read into every contract under New York law, is not distinct
from the contract itself.
See Page Mill Asset Mgmt. v. Credit
Suisse First Boston Corp., 98 Civ. 6907, 2000 WL 335557, at *8
(S.D.N.Y. Mar. 30, 2000); 511 W. 232nd Owners Corp. v. Jennifer
16
Realty Corp., 773 N.E.2d 496, 500-01 (N.Y. 2002).
“This
covenant embraces a pledge that neither party shall do anything
which will have the effect of destroying or injuring the right
of the other party to receive the fruits of the contract.”
Jennifer Realty Corp., 773 N.E.2d at 500 (internal citation
omitted).
A claim for breach of the implied covenant can be
maintained simultaneously with a breach of contract claim “only
if the damages sought by the plaintiff for breach of the implied
covenant are not ‘intrinsically tied to the damages allegedly
resulting from breach of contract.’”
Page Mill Asset Mgmt.,
2000 WL 335557, at *8 (quoting Canstar v. J.A. Jones Constr.
Co., 622 N.Y.S.2d 730, 731 (App. Div. 1995)); see also Excelsior
Fund, Inc. v. JP Morgan Chase Bank, N.A., 06 Civ. 5246, 2007 WL
950134, at *6-7 (S.D.N.Y. Mar. 28, 2007) (dismissing implied
covenant claim as duplicative of contract claim).
Giller argues that Wakefield v. N. Telecom, Inc., 769 F.2d
109 (2d Cir. 1985), supports the proposition that breach of the
implied covenant and breach of contract are distinct causes of
action.
In Wakefield, the Court of Appeals found that an
employer’s termination of an at-will employee “for the purpose
of avoiding the payment of commissions which are otherwise owed”
may breach the implied covenant despite the employee’s status as
an at-will employee.
769 F.2d at 112.
Here, however, unlike
Wakefield, the arbitrator found that Giller was not terminated,
17
actually or constructively, but voluntarily resigned his
position at Oracle.
(Award, at 21-22.)
Furthermore, in
Wakefield, the employer terminated the salesman after the
salesman had completed a number of sales but before commissions
were paid.
769 F.2d at 111-12.
In ruling for the plaintiff,
the Court of Appeals noted that the commissions “were virtually
certain to become vested . . . .”
Id. at 114.
Here, by
contrast, the arbitrator found that Giller’s sales had not yet
generated commissions because the client was not obligated by
contract to make any additional purchases and the subsequent
purchase orders were not yet booked.
(Award, at 12-13.)
Given
this uncertainty, the arbitrator found that Giller’s
Compensation Plan did not entitle him to the alleged commissions
on future sales at issue.
These findings supported the
arbitrator’s rejection of the breach of contract claim and also
disposed of the breach of implied covenant claim.
It cannot be
said that the arbitrator failed to decide Giller’s implied
covenant claim and, as such, the facts alleged in the Petition
cannot establish that the arbitrator manifestly disregarded the
law or violated section 10(a)(4) of the FAA.
18
VI.
Giller raised a somewhat different contention at oral
argument of the current motion.
He argued that the Supreme
Court’s decision in Stolt-Nielsen expanded the meaning of
section 10(a)(4) to cover the alleged errors of the arbitrator
in interpreting the Compensation Plan between the parties in
this case.
The petitioner misreads Stolt-Nielsen.
Section 10(a)(4) is a narrow provision that applies, by its
terms, only where “the arbitrators exceeded their powers, or so
imperfectly executed them that a mutual, final, and definite
award upon the subject matter submitted was not made.”
The
Supreme Court made it clear that,
“It is not enough . . . to show that the panel
committed an error -- or even a serious error. It is
only when an arbitrator strays from interpretation and
application of the agreement and effectively dispenses
his own brand of industrial justice that his decision
may be unenforceable.”
Stolt-Nielsen, 130 S.Ct. at 1767 (internal citation, quotation
marks, and alteration omitted).
In Stolt-Nielsen, the Supreme
Court found that the arbitration panel imposed a class action
provision in the arbitration agreement that the parties had not
intended and on which they did not agree.
130 S.Ct. at 1776.
In this case, the parties plainly intended to submit their
dispute to the arbitrator to decide.
19
Moreover, the arbitrator
decided the contractual dispute that was properly committed to
her based on her interpretation of the contract.
This was not a
case of importing contractual provisions based on any personal
views of industrial justice.
Accordingly, Oracle’s motion to dismiss Giller’s petition
to vacate the denial of his breach of contract claim is granted.
VII.
Giller also seeks to vacate the arbitration award pursuant
to section 10(a)(2) of the FAA based on the alleged partiality
of the arbitrator.
Giller argues that the arbitrator’s failure
to decide the dispute in his favor, in light of the arguments
discussed above, supports a conclusion regarding the
arbitrator’s partiality.
(Pet. ¶ 30.)
Aside from the adverse
ruling, which “alone rarely evidence[s] partiality,”
Scandinavian Reins. Co., Ltd. v. St. Paul Fire & Marine Ins.
Co., No. 10 Civ. 0910, 2012 WL 335772, at *10 (2d Cir. February
3, 2012), the Petition contains no plausible factual allegations
to support a claim of the arbitrator’s partiality.
Oracle’s
motion to dismiss Giller’s claim for vacatur under section
10(a)(2) is therefore granted.
20
VIII.
At argument, Oracle agreed that the award of $99,355 in
Giller's favor should be confirmed.
Because there is no basis
to vacate the portions of the award in Oracle's favor, the
entire award should be affirmed.
CONCLUSION
The Court has considered all of the arguments of the
parties.
To the extent not specifically addressed above, any
remaining arguments are either moot or without merit.
For the
reasons discussed above/ Oracle's motion to dismiss certain
portions of the petition is granted.
confirmed in its entirety.
The arbitration award is
The Clerk is directed to enter
Judgment and to close this case.
The Clerk is directed to close
all pending motions.
SO ORDERED.
Dated:
New York, New York
February 13, 2012
,
21
John G. Koel tl
d States District Judge
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