Case ID: f-appx_634/html/0332-01.html
Source: Caselaw Access Project
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Date Created: 2024-08-24T03:29:51.129683

ISMT, LIMITED, Petitioner-Appellee, v. FREMAK INDUSTRIES, INC., Respondent-Appellant.
    No. 15-2086.
    United States Court of Appeals, Second Circuit.
    Feb. 24, 2016.
    Michael B. Kramer, Michael B. Kramer & Associates, New York, NY, for Appellant.
    Lainie E. Cohen & Robert A, Giacovas, Lazare Potter & Giacovas LLP, New York, NY, for Appellee.
    PRESENT: DENNIS JACOBS, DENNY CHIN, and CHRISTOPHER F. DRONEY, Circuit Judges.
   SUMMARY ORDER

Fremak Industries, Inc. (“Fremak") appeals from the judgment of the United States District Court for the Southern District of New York .(Hellerstein, /.), confirming an arbitral award in favor of ISMT, Limited (“ISMT”). We assume the parties’ familiarity with the underlying facts, the procedural history, and the issues presented for review.

“We review a district court’s decision to confirm an arbitration award de novo to the extent it turns on legal questions, and we review any findings of fact for clear error.” Duferco Int’l Steel Trading v. T. Klaveness Shipping A/S, 833 F.3d 383, 388 (2d Cir.2003). “It is well established that courts must grant an arbitration panel’s decision great deference. A party petitioning a federal court to vacate an arbitral award bears the heavy burden of showing that the award falls within a vary narrow set of circumstances delineated by statute and case law____all of which involve corruption, fraud, or some other impropriety on the part of the arbitrators.” Id. Additionally, “we permit vacatur of an arbitral award that exhibits a ‘manifest disregard of law.’ ” Id. (quoting Goldman v. Architectural Iron Co., 306 F.3d 1214, 1216 (2d Cir.2002)). “Our review under the doctrine of manifest disregard is ‘severely limited.’ It is highly deferential to the arbi-tral award and obtaining judicial relief for arbitrators’ manifest disregard of the law is rare,” Id. at 389 (quoting Gov’t of India v. Cargill Inc., 867 F.2d 130, 133 (2d Cir. 1989)).

“First, we must consider whether the law that was allegedly ignored was clear, and in fact explicitly applicable to the matter before the arbitrators____ Second, once it is determined that the law is clear and plainly applicable, we must find that the law was in fact improperly applied, leading to an erroneous outcome. We will, of course, not vacate an arbitral award for an erroneous application of the law if a proper application of law would have yielded the same result____ Third, once the first two inquiries are satisfied, we look to a subjective element, that is, the knowledge actually possessed by the arbitrators.” Id. at 389-90. The doctrine is circumscribed to those “exceedingly rare instances where some egregious impropriety on the part of the arbitrators is apparent.” Id. An “arbitration award should be enforced, despite a court’s disagreement with it on the merits, if there is a barely colorable justification for the outcome reached.” Banco de Seguros Estado v. Mut. Marine Office, Inc., 344 F.3d 255, 260 (2d Cir.2003) (quoting Landy Michaels Realty Corp. v. Local 32B-32J, Serv. Emps. Int’l Union, AFL-CIO, 954 F.2d 794, 797 (2d Cir.1992)).

Fremak has fallen far short of sustaining its heavy burden. The Tribunal did not manifestly disregard the law in concluding, based on an analysis of the parties’ course of dealing, that Fremak waived its right to timely performance. Fremak contends that the Tribunal improperly weighed the evidence in finding that title passed from ISMT to Fremak on September 10, 2012; however, “the Second Circuit does not recognize manifest disregard of the evidence as proper ground for vacating an arbitrator’s award.” Wallace v. Buttar, 378 F.3d 182, 193 (2d Cir.2004) (quoting Success Sys., Inc. v. Maddy Petroleum Equip., Inc., 316 F.Supp.2d 93, 94 (D.Conn.2004)). Nor did the Tribunal manifestly disregard the law in concluding that Fremak failed to properly demand adequate assurances because it failed to put such a demand into writing. No other circumstance warrants disturbing the arbi-tral award.

For the foregoing reasons, and finding no merit in Fremak’s other arguments, we hereby AFFIRM the judgment of the district court: 
      
      . As a result, it is unnecessary to reach Fre-mak's argument that the Tribunal erred in finding that ISMT provided such assurances,' In any event, Fremak concedes it did not raise this argument below. It "is a well-established general rule that an appellate court will not consider an issue raised for the first time on appeal.” Greene v. United States, 13 F.3d 577, 586 (2d Cir.1994).