Appeals Court Throws Out Confidential Arbitration in Delaware
This post has been viewed 2,909 times.
A decision by a federal appeals court has ended Delaware’s experiment with confidential arbitration.
In an opinion released Wednesday, a three-judge panel for the United States Court of Appeals for the Third Circuit upheld a lower court ruling that Delaware’s state-sponsored arbitration program violated the First Amendment.
The controversial arbitration program was established by Delaware in 2009. Delaware is the leading state for incorporations by public companies, and the five judges on Delaware’s Chancery Court specialize in business disputes. The state Legislature was worried about Delaware’s continuing pre-eminence in resolving these disputes in light of the extraordinary growth in confidential arbitration for resolving disputes.
To “preserve Delaware’s pre-eminence in offering cost-effective options for resolving disputes,” the Legislature established a business arbitration program. The program was limited to business disputes involving Delaware companies and had to involve an amount in dispute of at least $1 million.
Read original articleTags: Arbitration Program, Delaware, federal appeals court
Related Posts
June 3, 2014
In a case that has attracted the attention of legal experts from across the country, the U.S. Court of Appeals for the Third...
October 31, 2013
Tom Stipanowich called the Delaware Court of Chancery’s arbitration program “a veritable trifecta of procedural advantages...
April 23, 2013
Last week, author Dan Solin, a long-time critic of FINRA, published a column in U.S. News & World Report attacking...
