When an agreement to arbitrate contains a clear and unmistakable “delegation” provision, gateway questions of arbitrability are for the arbitrator to decide. See, e.g., Kubala v. Supreme Prod. Servs., 830 F.3d 199, 201-02 (5th Cir. 2016), citing First Options of Chi., Inc. v. Kaplan, 514 U.S. 938, 942 (1995); Rent-A-Ctr., W., Inc. v. Jackson, 561 U.S. 63 (2010). But a determination of the delegation issue is not always obvious, and it is sometimes presented to an arbitrator, rather than to a court, in the first instance. In that case, a party challenging arbitrability may feel some trepidation about submitting its challenge to the very arbitrator who could ultimately be deciding the merits of the case. And another, possibly surprising, concern should be the risk that making such a challenge too vigorously in the arbitration proceeding will foreclose a fulsome judicial review of the arbitrator’s ruling on the scope of his or her own authority.
Ordinarily, arbitration awards are subject to very limited and deferential review. E.g., Sanders v. Gardner, 7 F. Supp. 2d 151 (S.D.N.Y. 1998), citing Willemijn Houdstermaatschappij, BV v. Standard Microsystems Corp., 103 F.3d 9, 12 (2d Cir. 1997). Generally, an arbitrator’s determination can only be vacated on the basis of one of four grounds enumerated in the Federal Arbitration Act (“FAA”): fraud, impartiality, misconduct, and evidence that the arbitrator exceeded its authority. 9 U.S.C. § 10(a); Hall St. Assocs., L.L.C. v. Mattel, Inc., 552 U.S. 576, 582 n.4 (2008). And a court’s review of an arbitral award is deferential. Thus, an award will not be vacated “even if the arbitrator’s interpretation of the contract is clearly erroneous, so long as such Award is explained in terms that offer even a barely colorable justification for the outcome reached.” Hygrade Operators, Inc. v. ILA Local 333, 945 F.2d 18, 22 (2d Cir. 1991); accord Fertilizer Corp. of India v. IDI Management, Inc., 517 F. Supp. 948, 960 (S.D. Ohio 1981); Mobile Oil Corp. v. Oil, Chemical & Atomic Workers Int’l Union & Local Union No. 4-522, 777 F. Supp. 1342, 1348-49 (E.D. La. 1991); Portland GE v. United States Bank Trust N.A., 38 F. Supp. 2d 1202, 1208 (D. Ore. 1999).
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