RICARDO M. URBINA, District Judge.
This matter arises from an employment dispute between the petitioners, a physician and his spouse, and the physician's former employer, respondent Washington Hospital Center ("the Hospital"). On November 5, 2004, in a prior action before this court, the court dismissed the petitioners' claims against the Hospital and its fellow respondents on the grounds that those claims were subject to a mandatory arbitration provision in the subject employment contract. The petitioners subsequently submitted their claims to arbitration and a final arbitration award was entered in favor of the respondents. Dissatisfied with the result of the arbitration proceedings, the petitioners initiated this action seeking vacatur of the arbitration award. Because the petitioners have not demonstrated that vacatur is appropriate, the court denies their petition to vacate the arbitration award.
Petitioner Thian Lok Tio, M.D. ("Dr. Tio") is a former employee of the Hospital,
On April 18, 2003, the Hospital terminated Dr. Tio's employment. Tio, 2004 WL
On November 5, 2004, the court granted the defendants' motion. Id. at *7. In reaching its decision, the court held that the Agreement, including the arbitration provision, was valid and enforceable. Id. at *6. The court also concluded that the arbitration provision encompassed all of the claims asserted by Dr. Tio and that Mrs. Tio's claims were entirely derivative of and dependent on Dr. Tio's claims and therefore subject to mandatory arbitration as well. Id. at *7.
The petitioners subsequently initiated an arbitration proceeding before Judicial Arbitration & Mediation Services, Inc. ("JAMS"), asserting all of the claims raised in their complaint. Pet. ¶ 13; Respts' Opp'n at 3. During a preliminary hearing, and without objection, the arbitrator narrowed the parties to those within the scope of the Agreement between Dr. Tio and the Hospital. Respts' Opp'n, Ex. E ("Final Award") at 2. On January 25, 2007, after briefing and oral argument, the arbitrator granted in part the Hospital's motion for summary judgment and dismissed all of the claims except Dr. Tio's claims for breach of contract and wrongful termination on the basis of discrimination. Id.
Beginning in late August 2007, the arbitrator conducted a hearing that spanned eight days. Id. at 3. At the hearing, the parties presented "diametrically opposed" versions of the events at issue. Id. at 3 n. 1. After considering the cumulative weight of all admissible evidence, including testimony adduced during the hearings, id., the arbitrator summarized his factual findings, in relevant part, as follows:
Id. at 4.
According to the arbitrator, Dr. Tio established at the hearing that he is a member of a protected class and that he suffered an adverse employment action when he was terminated from the hospital. Id. Nonetheless, the arbitrator held that to
Following the arbitrator's ruling, the petitioners filed this petition to vacate the arbitration award. See generally Pet. The petitioners contend that the arbitration award should be vacated because their claims were not subject to the Agreement's mandatory arbitration clause, the arbitrator displayed bias and acted in manifest disregard of the law and the fee-splitting provision of the Agreement's arbitration clause violates public policy. See generally id.; Petrs' Mem. in Support of Pet. ("Petrs' Mem."). The respondents maintain that the petitioners have presented no valid justification for vacating the final arbitration award. See generally Respts' Opp'n. With this matter ripe for disposition, the court turns to the applicable legal standards and the parties' arguments.
Despite this court's November 5, 2004 ruling, the petitioners contend that their claims should not have been submitted to arbitration because (1) the Agreement involves foreign or interstate commerce and is therefore exempt from the provisions of the Federal Arbitration Act ("FAA") under 9 U.S.C. § 1, (2) Dr. Tio's claim of tortious interference with third-party physician-patient contracts falls outside the scope of the Agreement as the claim arose after the termination of his employment with the Hospital and (3) the Hospital waived its right to invoke the arbitration clause of the Agreement as it did not seek to arbitrate this dispute prior to terminating Dr. Tio's employment. Pet. ¶¶ 5, 9-10. The petitioners raised each of these arguments in the prior proceedings before this court in response to the respondents' motion to dismiss and compel arbitration.
The court notes that the petitioners did not challenge the November 5, 2004 order dismissing their claims or the court's ruling concerning the scope of the arbitration provision. Under the FAA, "[a]n appeal may be taken from a final decision with respect to an arbitration that is subject to this title." 9 U.S.C.S. § 16(a)(3). A "final decision" is a decision "that ends the litigation on the merits and leaves nothing more for the court to do but execute the judgment." Green Tree Fin. Corp.-Alabama v. Randolph, 531 U.S. 79, 86, 121 S.Ct. 513, 148 L.Ed.2d 373 (2000) (internal quotations omitted). The court's November 5, 2004 order granting the Hospital's motion to dismiss and referring the petitioner's claims to arbitration under the arbitration clause of the Agreement constituted a final appealable decision. Id. at 89, 121 S.Ct. 513 (holding that district court order dismissing claims and directing arbitration is final within the meaning of 9 U.S.C. § 16(a)(3), and therefore appealable). Therefore, to the extent the petitioners disagree with the court's prior ruling, they failed to timely raise their objections on appeal.
Judicial review of arbitration awards is extremely limited. Kurke v. Oscar Gruss & Son, Inc., 454 F.3d 350, 354 (D.C.Cir.2006). The court "do[es] not sit to hear claims of factual or legal error by an arbitrator" in the manner that an appeals court would review a decision of a
9 U.S.C. § 10(a). The party challenging an arbitration award bears the burden of demonstrating that one of the statutory grounds set forth in the FAA exists. See Al-Harbi v. Citibank, N.A., 85 F.3d 680, 682 (D.C.Cir.1996).
In addition to the statutory grounds for vacatur, this Circuit has also stated that vacatur of an arbitration award is permitted if the arbitrator acted in "manifest disregard of the law,"
The Petitioners argue that vacatur is appropriate under the FAA on two
The court turns first to the petitioners' claim of evident partiality. A party challenging an arbitration award because of evident partiality bears a "heavy" burden to establish "specific facts that indicate improper motives on the part of an arbitrator." Al-Harbi, 85 F.3d at 683 (quoting Peoples Sec. Life Ins. Co. v. Monumental Life Ins. Co., 991 F.2d 141, 146 (4th Cir.1993)). "The alleged partiality must be direct, definite, and capable of demonstration rather than remote, uncertain or speculative." Id. (quoting Peoples Sec. Life Ins., 991 F.2d at 146). "[A] mere appearance of bias is insufficient to demonstrate evident partiality." Alston v. UBS Fin. Servs., Inc., 2006 WL 20516, at *3 (D.D.C. Jan. 2, 2006).
The petitioners contend that the arbitrator exhibited evident partiality in numerous procedural, substantive and evidentiary rulings during the course of the arbitration proceedings. See generally Pet. But rather than identifying specific facts that indicate improper motives on the part of the arbitrator, the petitioners rely primarily on speculative and conclusory allegations to support their claim. The petitioners do not support their assertion of evident partiality with a single citation to the record of the arbitration proceedings or any other evidence setting forth the specific facts necessary to support their position. See generally Pet.; Petrs' Mem. Indeed, the petitioners' claim of evident partiality rests almost exclusively on their dissatisfaction with the arbitrator's rulings that "eliminate[d] and restrict[ed] the claims, the parties, the number of witness [sic], [and] the timing and order of presentation of Petitioner's case in chief." Pet. ¶ 15. These rulings, however, do not demonstrate evident partiality.
The petitioners also contend that the arbitrator's ultimate conclusion and decision to enter the final arbitration award in favor of the respondents demonstrates his evident partiality. See Pet. ¶ 12; Petrs' Mem. at 24-25. It would appear that the petitioners base this contention on their belief that the arbitrator inappropriately credited the testimony of witnesses offered by the respondents, even though "[t]hey were contradicted on cross-examination." Petrs' Mem. at 25. The petitioners, however, have not identified specific testimony that they believe was unworthy of credence and point to no specific facts that indicate improper motives on the part of the arbitrator in concluding that the weight of the evidence favored the defendant. See generally Pet.; Petrs' Mem. Indeed, the arbitrator specifically noted in the final arbitration award that the parties had offered conflicting versions of the circumstances. Final Award at 3. The arbitrator further observed that "[w]hile the credibility of witnesses was taken into account. . . a finding that does not comport with a particular party's testimony should not necessarily be deemed a finding that the party lacked credibility. All findings were based upon the cumulative weight of all admissible evidence." Id. At any rate, the court is "not authorized to reconsider the merits of an award even though the parties may allege that the award rests on errors of fact." Teamsters Local Union No. 61, 272 F.3d at 604 (quoting United Paperworkers Int'l Union, AFL-CIO v. Misco, Inc., 484 U.S. 29, 36, 108 S.Ct. 364, 98 L.Ed.2d 286 (1987)). The court will not second-guess the arbitrator's award simply because the petitioners disagree with his factual conclusions.
Equally unavailing is the petitioners' argument that the arbitration award should be vacated because the arbitrator was guilty of misconduct in failing to hear certain evidence. See Pet. ¶ 14; Petrs' Mem. at 25-26. An arbitrator has the broad discretion to control the evidence in an arbitration proceeding, including the authority to refuse to hear evidence that is cumulative or of little relevance. Lessin v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 481 F.3d 813, 817-18 (D.C.Cir.2007); see also Fairchild, 516 F.Supp. at 1314 (noting that "arbitrators are charged with the duty of determining what evidence is relevant and what is irrelevant"). To justify vacatur on the ground of misconduct, the petitioners must demonstrate that the excluded evidence was pertinent and material to the controversy, 9 U.S.C. § 10(a)(3), and that the exclusion of the evidence deprived the petitioners of a fundamentally fair hearing, Lessin, 481 F.3d at 816; see also Fairchild, 516 F.Supp. at 1314 (recognizing that evidentiary mistakes do not provide grounds for vacating an arbitration award unless they undermine the fundamental fairness of the proceedings). Thus, "every failure to receive relevant evidence does not constitute misconduct under the [FAA] so as to require vacation of the award." Fairchild, 516 F.Supp. at 1314.
The "pertinent and material" evidence that the petitioners contend was erroneously excluded includes testimony by the wife of a hospitalized patient, testimony of "other patients . . . to show total revenue generated due to high income for specialized procedures," "testimony of other physicians and fellows as to Dr. Tio's leadership in running the unit," and "rebuttal testimony of witness to refute testimony of respondents['] witnesses." Pet. ¶ 14. It is
Accordingly, although the petitioners have demonstrated their dissatisfaction with the result of the arbitration proceeding, they have not established that vacatur is appropriate under 9 U.S.C. § 10(a). Because the petitioners failed to meet their burden, the court declines to vacate the arbitration award on statutory grounds.
As an alternate ground for vacatur, the petitioners contend that the arbitrator acted in manifest disregard of the law. Pet. ¶ 14; Petrs' Mem. at 20-21. Although the petitioners' arguments are not entirely clear, their primary contention appears to be that the arbitrator demonstrated manifest disregard of the law by denying the respondents' motion for summary judgment as to the breach of contract claim, but granting the motion as to Dr. Tio's claims of tortious interference, IIED and discrimination.
The respondents contend that their motion for summary judgment was "amply supported by record evidence demonstrating that [they were] entitled to summary judgment," Respts' Opp'n at 21, and have identified portions of the record indicating that the arbitrator made a reasoned and
To demonstrate that the arbitrator acted in manifest disregard of the law, the petitioners must show that the arbitrator knew of a governing legal principle, yet refused to apply it in ruling on their claims. LaPrade, 246 F.3d at 706. Because the parties briefed and argued the matters at issue in the respondents' motion for summary judgment, the court assumes arguendo that the arbitrator knew the legal principles that govern the petitioners' substantive claims. The petitioners, however, still must demonstrate that the arbitrator refused to apply these governing legal principles to their claims when he ruled on the respondents' motion for summary judgment.
The petitioners suggest that because there was a genuine issue of material fact related to their breach of contract claim, there must have also been a genuine issue of material fact related to their other claims. Petrs' Mem. at 21. This argument assumes that the petitioners' claims are comprised of overlapping or identical elements, such that they must all survive summary judgment or all be dismissed. Such an assumption is not justified. Indeed, it should be self-evident that the elements of a claim of IIED or tortious interference with a business relationship are not the same as the elements of a claim for breach of contract. Compare, e.g., Pitt v. Dist. of Columbia, 491 F.3d 494, 505-06 (D.C.Cir.2007) (setting forth the elements of an IIED claim under District of Columbia law) with Sturdza v. United Arab Emirates, 281 F.3d 1287, 1305 (D.C.Cir.2002) (setting forth the elements of a tortious interference claim under District of Columbia law) and Ihebereme v. Capital One, N.A., 2010 WL 3118815, at *3 (D.D.C. Aug. 9, 2010) (setting forth the elements of a breach of contract claim). Because the petitioners have offered no evidence to demonstrate that the arbitrator refused to apply or ignored the legal principles governing claims of tortious interference or IIED or any other claim at issue in the proceedings, they have not demonstrated that the arbitrator acted in manifest disregard of the law by granting in part and denying in part the respondents' motion for summary judgment. See generally Pet.; Petrs' Mem.
The petitioners also contend that the arbitrator acted in manifest disregard of the law by granting the respondents' motion for summary judgment on Dr. Tio's discrimination claim. See Pet. ¶ 14 (contending that "this partial finding [on the motion for summary judgment] is wrong with regard to claims of discrimination where the breach of contract could be based on such grounds"); Petrs' Mem. at 27 (arguing that the "Petitioners' discrimination claims should not have been cut off by way of Summary Judgment granted to the Respondents"). The record plainly indicates, however, that the arbitrator denied the respondents' motion for summary judgment on this claim. See Pre-Hearing Order No. 1 (granting summary judgment to the Hospital and dismissing all claims except Dr. Tio's claims of breach of contract and wrongful termination of employment on the basis of discrimination) (emphasis added); Final Award at 2 (stating that "the claims remaining to be heard
The petitioners also suggest that the arbitrator acted in manifest disregard of the law by ruling on the respondents' motion for summary judgment "with a single sentence." Pet. ¶ 14. Although the arbitrator did not render a detailed opinion as to the basis of his rulings on the motion for summary judgment, he was under no obligation to do so. See Sargent v. Paine Webber Jackson & Curtis, Inc., 882 F.2d 529, 532 (D.C.Cir.1989) (holding that arbitrators are not required to explain the basis for their awards); cf. Kurke, 454 F.3d at 354-55 (noting that "[e]ven where an explanation for an award is deficient or non-existent, [the court] will confirm it if a justifiable ground for the decision can be inferred from the facts of the case" (quoting Duferco Int'l Steel Trading v. T. Klaveness Shipping A/S, 333 F.3d 383, 390 (2d Cir.2003))).
In this case, the arbitrator indicated during the hearing that the basis of his ruling was the Hospital's forty-three page summary judgment brief. Hearing Tr. at 81:1-7. In their motion for summary judgment, the respondents set forth the material facts as to which there was no genuine dispute and produced deposition testimony and documentary evidence to establish those facts. See generally Respts' Opp'n, Ex. Q. For each of the petitioners' claims, the respondents addressed the governing legal standard and identified essential elements that they believed to be unsupported by the record. Id. In contrast, the petitioners' opposition to the respondents' motion for summary judgment consisted primarily of conclusory arguments about why summary judgment was not appropriate. See generally Respts' Opp'n, Ex. M. The only evidence offered in support of the petitioners' opposition was an affidavit of Dr. Tio. Id. This record amply justifies the arbitrator's decision to grant summary judgment to the respondents on some of the petitioners claims, and vacatur is not appropriate simply because the arbitrator ruled on the Hospital's motion for summary judgment without providing a detailed explanation for his ruling.
In sum, even after a liberal reading of the petitioners' arguments, it is clear they have not established that the arbitrator acted in manifest disregard of the law by refusing to apply governing legal principles to their claims. Accordingly, the court declines to vacate the arbitrator's ruling on this basis.
The petitioners also argue that the arbitration award should be vacated because it is against public policy to require a claimant who is advancing a discrimination claim in an arbitration proceeding to pay half the cost of the arbitration.
In an action to vindicate a public right, this Circuit disfavors placing the financial burden of arbitral proceedings on the party pursuing a claim. See Cole, 105 F.3d at 1485 (holding that employee could not be required to arbitrate discrimination claim as a condition of employment "if the arbitration agreement required him to pay all or part of the arbitrator's fees and expenses"). Nonetheless, a fee-splitting provision does not impede the remedial and deterrent functions of the statutory right "so long as the prospective litigant effectively may vindicate his or her statutory cause of action in the arbitral forum." Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20, 28, 111 S.Ct. 1647, 114 L.Ed.2d 26 (1991) (alteration in original) (citing Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614, 637, 105 S.Ct. 3346, 87 L.Ed.2d 444 (1985)).
The petitioners have no basis to challenge the fee-splitting requirement at this stage in the proceeding because there is no evidence that the requirement limited their ability to effectively vindicate Dr. Tio's statutory cause of action. LaPrade, 246 F.3d at 708 (rejecting an employee's challenge to a fee-splitting provision in an arbitration agreement because the employee did not claim "that the possibility of a large assessment arising from arbitration of her claims prevented her from attempting to vindicate her rights" or that "the arbitration panel failed to consider the evidence that she submitted to show she was financially unable to pay any assessment"). Indeed, there is nothing in the record to suggest that the petitioners objected to sharing the burden of the arbitration costs until after the arbitrator entered a final arbitration award in favor of the respondents.
For the foregoing reasons, the court denies the petition to vacate the arbitration award. An Order consistent with this Memorandum Opinion is separately and contemporaneously issued this 30th day of November, 2010.
