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IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF CALIFORNIA

SERGEI PORTNOY,

Plaintiff, No. CIV S-04-1462 GEB JFM PS

vs.

WASHINGTON MUTUAL BANK, F.A., FINDINGS AND RECOMMENDATIONS

Defendant. 

 /

Plaintiff is proceeding pro se with a third amended complaint alleging, inter alia,

breach of contract, violation of the Federal Fair Credit Reporting Act, 15 U.S.C. § 1681, and

violation of Federal Regulation “[12] CFR 229 Subpart B (Availability of Funds).” Defendant’s

petition for motion for an order confirming the arbitration award rendered herein on November

21, 2005, came on regularly for hearing before this court on April 13, 2006 at 11:00 a.m. before

the undersigned. Plaintiff Sergei Portnoy appeared in propria persona and Edward J. McNamara

appeared on behalf of defendant, Washington Mutual Bank ("WMB"). Upon review of the

motion and the documents in support and opposition, upon hearing the arguments of plaintiff and

counsel and good cause appearing therefor, THE COURT FINDS AS FOLLOWS:

Plaintiff opposes the petition to confirm, arguing that the American Arbitration

Association is a private organization and does not have authority to decide federal questions. 

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Plaintiff has presented no legal authority for his position. 

On a petition to confirm an arbitration award, the question is whether the

arbitrator acted in manifest disregard of the law. Appellate courts have unanimously held that

judicial review of an arbitrator's decision "is both limited and highly deferential." Barnes v.

Logan, 122 F.3d 820, 821 (9th Cir.1997). An award must be confirmed if the arbitrators even

"arguably construed or applied the contract and acted within the scope of their authority." Id. 

Manifest disregard of the law means something more than mere error in the law. 

Michigan Mutual Insurance Company v. Unigard Security Insurance Company, 44 F.3d 826, 832

(9th Cir.1995). Instead, it must be clear from the record that the arbitrators recognized the

applicable law and then ignored it. Id. Since arbitrators need not explain their decisions, a

reviewing court can only infer from the facts of the case whether the arbitrator appreciated the

law but chose to ignore it. United Steelworkers of America v. Enterprise Wheel & Car Corp.,

363 U.S. 593, 598, (1960); Houdstermaatschappij v. Standard Microsystems Corporation, 103

F.3d 9, 13 (2nd Cir.1997). When making this inference, the court must search for "even a barely

colorable justification for the outcome reached," and if one is found, the arbitration award must

be confirmed. Id. at 13. This search, however, does not involve a federal question, but rather an

analysis of the conduct of the arbitrators. 

Thus, whether or not the arbitration was performed by a private organization is of

no relevance here. Plaintiff’s objection is overruled.

The Federal Arbitration Act ("FAA"), 9 U.S.C. §§ 1-14, authorizes judicial review

of arbitration awards that are connected with maritime or interstate commerce. 9 U.S.C. § 2. It

also allows a party to petition for confirmation of an arbitration award: 

[A]t any time within one year after the award is made any party to

the arbitration may apply to the court for an order confirming the

award and thereupon the court must grant such an order unless the

award is vacated, modified, or corrected.

9 U.S.C. § 9. The FAA does not confer an independent basis for federal subject matter jurisCase 2:04-cv-01462-GEB -JFM Document 35 Filed 04/19/06 Page 2 of 3
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diction. See Moses H. Cone Mem'l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 25 n.32, (1983).

This matter was submitted to binding arbitration pursuant to an arbitration

agreement executed by plaintiff. True and correct copies of the arbitration agreement and

petition to compel arbitration, and order thereto, were attached to WMB's petition to confirm

arbitration award as Exhibit "A" and Exhibit "B." 

This matter was reviewed by arbitrator Patricia Shuler Schimbor ("Schimbor"). 

Arbitrator Schimbor rendered her opinion and issued her award of arbitrator which is attached to

WMB's petition to confirm arbitrator's award as Exhibit "C." The arbitrator found that plaintiff

failed to meet his burden of proof. This finding is a colorable justification for the denial of

plaintiff’s claim. Therefore, the arbitration award should be confirmed.

In accordance with the above, IT IS HEREBY RECOMMENDED that the award

of arbitrator be entered and be the judgment of this court.

These findings and recommendations are submitted to the United States District

Judge assigned to the case, pursuant to the provisions of Title 28 U.S.C. § 636(b)(l). Within ten

days after being served with these findings and recommendations, any party may file written

objections with the court and serve a copy on all parties. Such a document should be captioned

"Objections to Magistrate Judge's Findings and Recommendations." The parties are advised that

failure to file objections within the specified time may waive the right to appeal the District

Court's order. Martinez v. Ylst, 951 F.2d 1153 (9th Cir. 1991).

Dated: April 18, 2006.

001; portnoy.fr

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