Source: https://casetext.com/case/thrivent-fin-for-lutherans-thrivent-inv-mgmt-inc-v-bibow
Timestamp: 2019-04-23 02:23:44+00:00

Document:
THRIVENT FINANCIAL FOR LUTHERANS and THRIVENT INVESTMENT MANAGEMENT INC., Petitioners, v. CHRISTOPHER W. BIBOW, Respondent.
Petitioners Thrivent Financial for Lutherans and Thrivent Investment Management Inc. (collectively, "Thrivent") seek confirmation of a Financial Industry Regulatory Authority, Inc. ("FINRA") arbitration award (the "Award"). The Award rejected Respondent Christopher Bibow's claims and recommended expungement of the reasons for his termination on the Form U-5. Bibow seeks vacatur of the the Award, except that he, too, seeks confirmation of the expungement. For the reasons that follow, Thrivent's motion is granted, Bibow's motion is granted in part and denied in part, and the Award is confirmed.
Bibow also filed a lawsuit in this District that was stayed pending resolution of the FINRA arbitration. See Bibow v. Thrivent Financial for Lutherans, et ano., 14-CV-09843 (LAK).
Arbitration awards "are not self-enforcing, [so] they must be given force and effect by being converted to judicial orders by courts; these orders can confirm and/or vacate the award, either in whole or in part." D.H. Blair & Co. v. Gottdiener, 462 F.3d 95, 104 (2d Cir. 2006) (citation omitted); Ceona PTE Ltd. v. Bmt Giant, S.A. De C.V., No. 16-CV-4437 (WHP), 2016 WL 6094126, at *1 (S.D.N.Y. Oct. 19, 2016). "[J]udicial review of an arbitration award is narrowly limited." Barbier v. Shearson Lehman Hutton Inc., 948 F.2d 117, 120 (2d Cir. 1991). An "arbitrator's decision is entitled to substantial deference," Yusuf Ahmed Alghanim & Sons v. Toys 'R' Us, Inc., 126 F.3d 15, 23 (2d Cir. 1997), and "a court is [generally] required to enforce the arbitration award as long as there is a barely colorable justification for the outcome reached." Leeward Constr. Co., Ltd. v. Am. Univ. of Antigua-Coll. of Med., 826 F.3d 634, 638 (2d Cir. 2016) (internal quotation marks omitted). "The arbitrator's rationale for an award need not be explained, and the award should be confirmed if a ground for the arbitrator's decision can be inferred from the facts of the case." D.H. Blair, 462 F.3d at 110 (internal quotation marks omitted). Thus, a court's authority to vacate an arbitration award is limited.
In addition, a court may overturn an award where there has been a "manifest disregard of the law." Benihana, Inc. v. Benihana of Tokyo, LLC, No. 15-CV-7428 (PAE), 2016 WL 3913599, at *10 (S.D.N.Y. July 15, 2016). "[T]he manifest disregard standard, rather than substantially broadening the grounds for vacatur, largely operates 'as a judicial gloss on the specific grounds for vacatur enumerated in section 10 of the FAA.'" Benihana, 2016 WL 3913599, at *10 (quoting Stolt-Nielsen S.A. v. AnimalFeeds Int'l Corp., 548 F.3d 85, 91 (2d Cir. 2008), rev'd and remanded on other grounds, 559 U.S. 662 (2010)). "Vacatur of an arbitral award for manifest disregard of the law 'is a doctrine of last resort,' reserved for 'those exceedingly rare instances where some egregious impropriety on the part of the arbitrators is apparent but where none of the provisions of the FAA apply.'" Benihana, 2016 WL 3913599, at *10 (quoting Duferco Int'l Steel Trading v. T. Klaveness Shipping A/S, 333 F.3d 383, 389 (2d Cir. 2003)). Manifest disregard applies where: "(1) 'the law that was allegedly ignored was clear, and in fact explicitly applicable to the matter before the arbitrators,' (2) 'the law was in fact improperly applied, leading to an erroneous outcome,' and (3) 'the arbitrator ... kn[ew] of its existence, and its applicability to the problem before him.'" Benihana, 2016 WL 3913599, at *10 (quoting Duferco, 333 F.3d at 390).
While Bibow agrees with that portion of the Award recommending expungement and correction of his Form U-5, he contends that the remainder of the Award is inconsistent with expungement. Specifically, he argues that the corrected language demonstrates that the original language was false and therefore supports his defamation claim. He also asserts that the corrected language does not satisfy any explicit provision for termination under the Agreement and therefore supports his breach of contract claim. But "whatever the weight of the evidence considered as a whole, if a ground for the arbitrator's decision can be inferred from the facts of the case, the award should be confirmed." Wallace v. Buttar, 378 F.3d 182, 193 (2d Cir. 2004) (internal quotation marks omitted). Here, a colorable justification for the Award can be inferred.
considering whether to do business with a registered (or formerly registered) person.
By attempting to draw inferences in his favor, Bibow misconstrues the standard of review. "[T]he award should be confirmed if a ground for the arbitrator's decision can be inferred from the facts of the case." D.H. Blair, 462 F.3d at 110 (internal quotation marks omitted); Bear, Stearns & Co., Bear, Stearns Sec. Corp. v. 1109580 Ontario, Inc., 409 F.3d 87, 91 (2d Cir. 2005) (holding that courts must confirm arbitration awards if there is "any basis for upholding the decision."). The panel could have plausibly believed that many of FINRA's rationales did not apply because Bibow's termination was "unrelated to the sale of securities." Moreover, this is not one of "those exceedingly rare instances where some egregious impropriety on the part of the arbitrator is apparent." T. Co Metals, LLC v. Dempsey Pipe & Supply, Inc., 592 F.3d 329, 339 (2d Cir. 2010).

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