2004 Decisions

Opinions of the United

States Court of Appeals

for the Third Circuit

7-22-2004

Piller v. Valentino

Precedential or Non-Precedential: Non-Precedential

Docket No. 00-1146

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Recommended Citation

"Piller v. Valentino" (2004). 2004 Decisions. Paper 473.

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NOT PRECEDENTIAL

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

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No. 00-1146

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SHAINDE PILLER

 Appellant

 v.

JOHN J. VALENTINO; MARY CLARE VALENTINO; 3177-79 RICHMOND

ST; 3036 RICHMOND STREET CORP., t/a JV DISTRIBUTING

___________

On Appeal from the United States District Court

for the Eastern District of Pennsylvania

(D.C. Civil No. 99-mc-00040)

District Judge: The Honorable Stewart Dalzell

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Submitted Under Third Circuit LAR 34.1(a)

June 21, 2004

Before: NYGAARD, McKEE, and CHERTOFF, Circuit Judges.

(Filed: July 22, 2004)

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OPINION OF THE COURT

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NYGAARD, Circuit Judge.

Appellant Shainde Piller appeals from an order granting the appellees’ motion to

confirm their arbitration award. We will affirm.

I.

Various individuals and corporations, including Piller and referred to herein as the

Kent parties, had business relationships with John J. and Mary Claire Valentino, 3177/79

Richmond Corp., and 3036 Richmond Street Corp., t/a JV Distributing. The Kent parties

purchased electronics goods from JV. Through an unwritten agreement, the parties also

formed 1832 MacAurthur Corporation.

A dispute between the Kent parties and JV occurred when JV alleged that the Kent

parties refused to pay for approximately $1,000,000 in goods (the accounts receivable

claims), and the parties disagreed about capital contributions to 1832 Corp. (the 1832

claims). JV filed suit, and the parties agreed to arbitrate the dispute before the American

Arbitration Association. After eighteen months of arbitration, the arbitrator awarded JV

$878,122.23 on the accounts receivable claims and $203,479.27 on the 1832 claims, and

additionally ordered that 1832 Corp. be liquidated. JV filed an action to confirm the

arbitration award and the Kent parties moved to vacate the award. After the parties

agreed the awards were flawed and should be vacated, the District Court issued such an
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order. The matter was remanded to the AAA and, after consideration of new submissions

by the parties and reconsideration of the materials previously before him, the arbitrator

entered a final award in favor of JV that was similar to the initial award. Shainde Piller,

the remaining Kent party, filed an action in the District Court to vacate the final award. 

The Court granted JV’s cross-petition to confirm the final award and this appeal

followed.

II.

The courts have very limited discretion to disturb an arbitration award. See, e.g.,

Amalgamated Meat Cutters & Butcher Workmen v. Cross Bros. Meat Packers, Inc., 518

F.2d 1113, 1121 (3d Cir. 1975) (noting that our scope of review under the FAA is

“narrow in the extreme”); see also 9 U.S.C. §§ 9-10. Section 10(a) of the FAA limits the

grounds on which a court may vacate an arbitration award to: (1) awards procured by

corruption, fraud, or undue means; (2) cases where there was evident partiality or

corruption by the arbitrator(s); (3) cases where the arbitrator(s) acted with misconduct so

as to prejudice a party; or (4) cases where the arbitrator(s) exceeded or imperfectly

executed their powers such that a final and definite award was not made. 9 U.S.C. §

10(a). We have held that 

an arbitrator’s award must be upheld if the interpretation can in

any rational way be derived from the agreement, viewed in the

light of its language, its context, and any other indicia of the

parties’ intention; only where there is a manifest disregard of the

agreement, totally unsupported by principles of contract
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construction and the law of the shop, may a reviewing court

disturb the award. 

U.S. Steel & Carnegie Pension Fund v. McSkimming, 759 F.2d 269, 270-71 (3d Cir.

1985) (internal quotations omitted).

III.

On appeal, Piller makes two arguments attacking the arbitrator’s award. First, she

argues that the arbitrator exceeded his authority by deviating from the parties’ agreement

to be bound by the report of the accounting firm Tait, Weller & Baker (“TWB”). 

Arbitrators derive their authority from the arbitration agreement, and where action

is taken in excess of this granted authority, a court may vacate the award. We have used a

two-step process to determine whether an arbitrator exceeded his powers: (1) the form of

the award must be rationally derived either from the agreement between the parties or

from the parties’ submission to the arbitrators, and (2) the terms of the award must not be

“completely irrational.” Mut. Fire, Marine & Inland Ins. Co. v. Norad Reinsurance Co.,

868 F.2d 52, 56 (3d Cir. 1989). 

Here, the arbitrator did not exceed his authority because the terms of the award

were not irrational and it was derived from the agreement of the parties and the parties’

submissions. The parties had agreed to retain TWB to report on the accounts receivables

and the 1832 claims, and these reports were admitted into evidence and considered by the

arbitrator. In addition, however, the arbitrator appropriately considered the testimony of a
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number of individuals and extensive documentary evidence. In doing so, the arbitrator

did not exceed his powers.

Piller’s second argument is that the arbitrator’s award should be vacated because

the arbitrator acted in manifest disregard of the law and facts. We have held that in order

for a court to vacate an arbitration award, there must be absolutely nothing in the record

to justify the arbitrator’s decision. See News Am. Publ’ns, Inc. v. Newark, 918 F.2d 21,

24 (3d Cir. 1990). “As long as the arbitrator has arguably construed or applied the

contract, the award must be enforced.” Id. at 24 (emphasis in original) (citing United

Paperworkers Int’l Union v. Misco, 484 U.S. 29, 38 (1987)).

As discussed above, the arbitrator’s decision was based on a consideration of all

the evidence before him. Piller has identified no specific facts that the arbitrator

manifestly disregarded. Thus under our highly deferential standard of review, we will

affirm.

IV.

For the reasons set forth, we will affirm the District Court’s order granting the

appellees’ motion to confirm the award.
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