Opinion ID: 783506
Heading Depth: 2
Heading Rank: 4

Heading: Whether the Arbitrator Exceeded His Powers

Text: 51 An arbitrator exceeds his powers when he rule[s] on issues not presented to [him] by the parties. See Fahnestock & Co. v. Waltman, 935 F.2d 512, 515 (2d Cir.1991) (citation and quotation marks omitted); 9 U.S.C. § 10(a)(4). Section 10(a)(4) of the FAA focuses on whether the arbitrator[ ] had the power, based on the parties' submissions or the arbitration agreement, to reach a certain issue, not whether the arbitrator[ ] correctly decided that issue. DiRussa v. Dean Witter Reynolds, Inc., 121 F.3d 818, 824 (2d Cir.1997). MVL contends that the arbitrator exceeded his powers by calculating Primary Year EBITDA in accordance with his understanding of the parties' intent, rather than in accordance with GAAP. The District Court concluded that § 10(a)(4) does not provide a basis for vacatur of the arbitration award because MVL's contention that Sherrill failed to apply GAAP is best characterized as a challenge to his application of the law, rather than a challenge under Section 10(a)(4). (Order, Aug. 30, 2002, at 30.) 52 We agree with the District Court. MVL does not contend that the arbitrator resolved an issue that the parties' agreement did not authorize him to resolve. Indeed, the only issue that he resolved — the calculation of Primary Year EBITDA — was the precise issue that the Amendment authorized him to decide. (Amendment to Stock Purchase Agreement § 1(d); Letter from Sherrill to Morris and Smith of 8/15/01, at 4.) MVL does not argue that the arbitrator decided any issue other than the calculation of EBITDA; rather, MVL argues that he calculated EBITDA incorrectly. Even if MVL is correct, however, that argument provides no basis for vacating the award under § 10(a)(4). See DiRussa, 121 F.3d at 824 (DiRussa's real objection appears to be that the arbitrators committed an obvious legal error in denying him attorney's fees. Section 10(a)(4) was not intended to apply to such a situation.). Accordingly, the District Court correctly concluded that § 10(a)(4) does not provide a basis for vacating the arbitration award.