_____________ No. 95-3579SD

_____________ Ernest D. Olson (Bud), * * Appellant, * * Appeal from the United States v. * District Court for the District * of South Dakota. National Association of * Securities Dealers, a * Corporation; Edward J. Hentges, * an individual, * * Appellees. *

_____________ Submitted: April 11, 1996 Filed: June 7, 1996

_____________ Before McMILLIAN, JOHN R. GIBSON, and FAGG, Circuit Judges.

_____________ FAGG, Circuit Judge.

This is Ernest D. Olson's second federal appeal arising fro m contractually required arbitration of his age discrimination action agains t his forme r employer. After a panel of arbitrators sponsored by th e National Association of Securities Dealers (NASD) decided in the employer' s favor , Olson learned one of the arbitrators, Edward J. Hentges, had a n ongoing business relationship with the employer. Olson asked the district court t o vacate the arbitration decision, contending the arbitrator' s failure to disclose the relationship showed "evident partiality." See 9 U.S.C. § 10(a)(2) (1994). The district court denied Olson's motion, but we agreed with Olson and reversed. Olson v. Mer rill Lynch, Pierce, Fenner & Smith , Inc. , 51 F.3d 157 (8th Cir. 1995). Before arbitrating his ag e disc riminationclaim again, however, Olson filed this separate lawsui t against the NASD for its

### -2-

appoin tment of Hentges. Olson alleges breach of contract, fraudulen t misrepresentation, ne gligent processing of arbitration, gross negligence, breach of warranty, and intentional infliction of emotional distress
. Olson also brought claims against Hentges. The district court dismissed Olson's complaint, holding the NASD was immune from liability and the cour t lacked personal jurisdiction over Hentges. Olso n appeals the dismissal of his claims against the NASD, and we affirm.

Because an arbitrator's role is func tionally equivalent to a judge's role, courts of appeals have uniformly extended judicial and quasi-judicia l immunity to arbitrato rs. Austern v. Chicago Bd. Options Exch., Inc. , 898 F.2d 882, 886 (2d Cir.), cert. denied , 498 U.S. 850 (1990); Wasyl, Inc. v. First Boston Corp. , 8 13 F.2d 1579, 1582 (9th Cir. 1987); Ozark Air Lines, Inc. v. National Mediation Bd. , 797 F.2d 557, 563-64 (8th Cir. 1986); Core y v. New York Stock Exch. , 691 F.2d 1205, 1209 (6th Cir. 1982); Tamari v
. Conrad , 552 F.2d 778, 780-81 (7th Cir. 1977); Shrader v. NASD, Inc. , 855 F. Supp. 122, 123-24 (E.D.N.C. 1994), aff'd , 54 F.3d 774 (4th Cir. 1995) (unpubl ished per curiam). Like judicial and quasi-judicial immunity , arbit ral immunity is necessary to protect decisionmakers from undu e infl uence, and the decision-making process from attack by dissatisfie d litigants. Austern , 898 F.2d at 886; Corey , 691 F.2d at 1211. The courts also ag ree that to give effect to these underlying policies, arbitra l immunityextends beyond arbitrators themselves to organizations tha t spons or arbitrations. Austern , 898 F.2d at 886-87; Corey , 691 F.2d a t 1211; Shrader , 855 F. Supp. at 124; Cort v. American Arbitration Ass'n , 79 5 F. Supp. 970, 972-73 (N.D. Cal. 1992). Without this extension, arbitral immuni tywould be almost meaningless because liability would simply b e sh ifted from individual arbitrators to the sponsoring organizations
. Aus tern , 898 F.2d at 886; Corey , 691 F.2d at 1211. Arbitral immunit y protects all acts wit hin the scope of the arbitral process. Austern , 898 F.2d at 886.

### -3- Olson argues the NASD's appointment of Hentges was not within th e scope of the arbitral process because it occurred before the decision

making process began. The appointment of arbitrators is a necessary part of arbitration admini stration, however, and thus is protected by arbitral immunity. Austern , 898 F.2d at 884; Corey , 691 F.2d at 1208; Cort , 795 F. Supp. at 972. Olson also asserts arbitral immun ity does not apply because the appointment of He ntges violated the NASD's own rules. We reject this contention as well. A sponsoring organization is immune from civi l liabil ityfor improperly selecting an arbitration panel, even when th e selection violates the organization's own rules. Austern , 898 F.2d at 884 , 886; Corey , 691 F.2d at 1208, 1211; see Cort , 795 F. Supp. at 972-73.

Ou r decision does not leave Olson without redress for the NASD' s app ointment of a possibly biased arbitrator. Courts can vacate tainte d arbitrationdecisions under 9 U.S.C. § 10. See Corey , 691 F.2d at 1211;
see also L & H Airco, Inc. v. Rapistan Corp. , 446 N.W.2d 372, 374, 37 7 (Minn. 1989) (involving analogous Minnesota law). Indeed, Olson ha s already sought vacation of the arbitration decision under § 10 an d prevailed. Olson , 51 F.3d at 160. Thus, Olson will receive a ne w arbitrationproceeding free from actual or perceived bias. L & H Airco , 446 N.W.2d at 377.
Having reviewed the issue de novo, we conclude the NASD is immun e from liability for sponsoring the tainted arbitr ation proceeding. We thus affirm the district c ourt's dismissal of Olson's claims against the NASD.
A true copy.

Attest:
CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.