Court Opinion

ID: 9930212
Source: CourtListenerOpinion
Date Created: 2024-02-06 16:03:20.380428+00
Date Added: 2024-06-11T11:08:21.469735
License: Public Domain

USCA11 Case: 22-11835     Document: 60-1      Date Filed: 02/06/2024   Page: 1 of 20

                                                    [DO NOT PUBLISH]
                                     In the
                 United States Court of Appeals
                          For the Eleventh Circuit

                           ____________________

                                  No. 22-11835
                           ____________________

        THE GOLDMAN SACHS TRUST COMPANY, N.A.,
        PATRICK LANNON
        as Co-Trustees of the Beverly B. Schottenstein Revocable
        Trust U/A/D April 5, 2011,
                                                       Plaintiﬀs-Appellees,
        versus
        J.P. MORGAN SECURITIES, LLC,

                                                               Defendant,

        EVAN A. SCHOTTENSTEIN,
        AVI E. SCHOTTENSTEIN,
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        2                         Opinion of the Court                    22-11835

                                                          Defendants-Appellants.

                               ____________________

                    Appeal from the United States District Court
                        for the Southern District of Florida
                        D.C. Docket No. 1:21-cv-20521-BB
                             ____________________

        Before ROSENBAUM, NEWSOM, and LUCK, Circuit Judges.
        PER CURIAM:
                This appeal considers whether the district court correctly af-
        firmed a unanimous arbitration award that the arbitration panel is-
        sued after 43 hearing sessions spanning 145 hours. Appellants Evan
        Schottenstein and Avi Schottenstein argue that the award should
        be vacated because (1) the arbitration panel’s chairperson did not
        disclose that she had a lawsuit against State Farm that was dis-
        missed five months before the final hearing began, even though
        evidence was introduced that Evan 1 had accepted a job at State
        Farm, and (2) the arbitration panel denied Evan and Avi’s request
        to postpone the final hearing and instead held it virtually. After
        careful consideration, we reject both arguments and affirm the dis-
        trict court’s denial of Evan and Avi’s motion to vacate the arbitra-
        tion award.

        1 Because this case involves four people whose last name is Schottenstein, to

        avoid confusion, we use these individuals’ first names.
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        22-11835                Opinion of the Court                          3

               First, an arbitrator’s failure to disclose information results in
        vacatur of an arbitration award only when evident partiality creates
        an actual conflict or a reasonable person would believe that a po-
        tential conflict exists. Evan and Avi do not claim that an actual
        conflict existed, and no reasonable person would believe that a po-
        tential conflict existed here. State Farm was not involved in the
        arbitration or events leading up to the dispute, State Farm was
        mentioned only twice during the 145-hour hearing, and Evan was
        merely a prospective employee of State Farm with no apparent re-
        lation to the chairperson’s previously dismissed separate lawsuit.
               Second, federal courts vacate arbitration awards based on the
        denial of a request to postpone a hearing only when the arbitration
        panel had no reasonable basis for denying postponement. But
        here, several reasonable considerations led the panel to decline to
        postpone the hearing: the expeditious resolution of the dispute, the
        claimant’s senior age of 94 years, the ongoing COVID-19 pandemic
        and availability of virtual hearings, and Evan and Avi’s consent to
        holding a virtual hearing five months later, anyway.
               Because neither of Evan and Avi’s arguments provides a
        valid basis to vacate the arbitration award, we affirm the decision
        of the district court.
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        4                         Opinion of the Court                 22-11835

                                   I.     BACKGROUND

                On July 24, 2019, Beverly 2 Schottenstein demanded arbitra-
        tion by the Financial Industry Regulatory Authority (“FINRA”)
        against appellants Evan and Avi, her grandsons. Beverly alleged
        constructive fraud, common law fraud, and elder abuse and exploi-
        tation.
                Beverly’s allegations arose out of the transfer of her invest-
        ment assets to a trust account that Evan and Avi managed. Beverly
        asserted that Evan and Avi made sales and purchases, commission
        and fee payments, and a sale that resulted in a huge capital-gains
        tax, all without her knowledge or authorization. She also con-
        tended that Evan and Avi forged her signature to allow them to
        make large transactions without her knowledge and set up a ficti-
        tious email account in her name so that all financial statements
        would be sent to that email address instead of to her.
               Evan and Avi responded that cousin Alexis Schottenstein
        fabricated these allegations. As Evan and Avi told it, Alexis was
        “jealous” of the gifts Beverly gave them. These gifts included an
        apartment, even though Beverly refused to buy Alexis a condomin-
        ium. Evan and Avi said that this animosity boiled over when Alexis
        discovered a draft estate-planning document in Beverly’s papers
        that limited her inheritance.

        2 The record contains different spellings of “Beverly.”
                                                            We use “Beverly” be-
        cause the case caption refers to the “Beverly B. Schottenstein Revocable
        Trust.”
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        22-11835              Opinion of the Court                        5

                In Evan and Avi’s view, Alexis began to control Beverly.
        They alleged that she enlisted a cousin, Cathy Schottenstein Pattap,
        who helped Beverly move her accounts away from Evan and Avi.
        Then, they claimed, Alexis and Cathy created a document with
        false allegations against Evan and Avi titled “Outline/Notes of Se-
        curities Fraud & Financial Elder Abuse Committed by Evan, Avi
        and Bobby Schottenstein against Beverl[]y Schottenstein and her
        Estate.” The outline included accusations that Beverly “was not
        receiving statements on her brokerage account” because Evan cre-
        ated “an online banking portal” with “a fake email address” that he
        controlled and that Beverly was unaware of.
               Allegations from this outline ended up in the statement of
        claim filed with FINRA. So Evan and Avi asserted, among other
        defenses, that Alexis made up the allegations. To support this, they
        pointed to Alexis’s past employment at Wells Fargo. They said
        Alexis was fired from Wells Fargo for enrolling customers in
        online-statement delivery without their consent. And they argued
        that Alexis’s alleged past misconduct relating to online-statement
        delivery parallels the allegations against Evan and Avi for miscon-
        duct relating to online-statement delivery, casting doubt on the
        credibility and truthfulness of those allegations.
               In furtherance of their theory, Evan and Avi convinced the
        arbitration panel to issue subpoenas to Wells Fargo and Alexis.
        Wells Fargo and Alexis both refused to comply with the subpoenas,
        so Evan and Avi filed an enforcement action in the Southern Dis-
        trict of Florida. The magistrate judge there recommended
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        6                      Opinion of the Court                22-11835

        dismissing the action for lack of subject-matter jurisdiction because
        the parties lacked diversity—they were all citizens of New York,
        and the amount in controversy between the parties did not exceed
        $75,000. Schottenstein v. Wells Fargo Bank, N.A., No. 9:20-mc-81924-
        RS, 2020 WL 7399003 (S.D. Fla. Dec. 17, 2020). Evan and Avi vol-
        untarily dismissed the enforcement action after the arbitration
        ended.
               Before that happened, though, on March 27, 2020, FINRA
        postponed all in-person arbitration hearings because of the
        COVID-19 pandemic. It allowed virtual hearings to take place ei-
        ther by joint agreement or panel order.
               On July 23, 2020, Beverly moved for the panel to conduct
        the final hearing virtually. Evan and Avi opposed this motion.
        They argued in relevant part that conducting the hearing virtually
        would impede the “ability to compel documents and testimony
        from non-FINRA member third parties,” and FINRA did not au-
        thorize conducting virtual hearings through its formal rule-making
        process. Evan and Avi asked for the hearing to be postponed from
        October 2020 to the spring of 2021. They agreed, though, that if
        in-person hearings were still not permitted by that time, they
        would not object to virtual proceedings then.
               The arbitration panel denied the request to postpone the fi-
        nal hearing. Instead, in an unreasoned order, it directed the final
        hearing to begin virtually on the day already scheduled in October
        2020. The final hearing stretched over 43 sessions and 145 hours.
        Alexis and Wells Fargo did not testify. But Pattap did testify,
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        22-11835               Opinion of the Court                        7

        including about the outline that she and Alexis put together and
        that Evan and Avi claimed contained false allegations.
                Also during the final hearing sessions on October 21 and 22,
        the arbitration panel heard testimony and saw text messages show-
        ing that Evan had interviewed for and accepted a job at State Farm
        related to property insurance. Specifically, Pattap testified that
        Evan told her in August 2020 that he had “an interview at State
        Farm Insurance.” Then, in a September 2020 text message to Pat-
        tap, Evan said, “I just took the job at State Farm.” The parties do
        not point to any evidence suggesting that Evan actually started
        working at State Farm by the time of the arbitration hearings; in
        fact, after Evan told Pattap he accepted the job, she asked if he had
        started working in the State Farm office, and he responded, “No I
        need to get my property casualty license first.”
               The arbitration panel unanimously issued an arbitration
        award in favor of Beverly and against Evan for more than $9 mil-
        lion and Avi for about $602,251. After the panel issued its award,
        Evan and Avi learned that the arbitration panel’s chairperson,
        Donna Solomon, had filed a lawsuit against State Farm in March
        2020, while the arbitration was pending. The lawsuit was a breach-
        of-contract claim concerning the denial of Solomon’s property-in-
        surance claim. And it was not long-lived. The case was dismissed
        in May 2020, almost five months before the arbitration’s final hear-
        ings began. Solomon did not disclose her lawsuit against State
        Farm during the arbitration.
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        8                         Opinion of the Court                   22-11835

               Beverly filed this action to confirm the arbitration award.
        Evan and Avi moved to vacate the arbitration award on several
        grounds, including that the arbitration panel wrongly denied their
        motion to postpone the final hearing and that Solomon should
        have disclosed her lawsuit against State Farm. The district court
        rejected these arguments and confirmed the arbitration award.
        Evan and Avi timely filed this appeal. 3
                            II.    STANDARD OF REVIEW

                We review orders confirming arbitration awards “for clear
        error with respect to factual findings and de novo with respect to the
        district court’s legal conclusions.” Gianelli Money Purchase Plan &
        Trust v. ADM Inv’r Servs., Inc., 146 F.3d 1309, 1311 (11th Cir. 1998).
        We can affirm the district court’s judgment denying the motion to
        vacate the arbitration award “on any ground that finds support in
        the record.” Grange Mut. Cas. Co. v. Slaughter, 958 F.3d 1050, 1056
        (11th Cir. 2020) (quoting Wetherbee v. S. Co., 754 F.3d 901, 905 (11th
        Cir. 2014)).
                                   III.    DISCUSSION

              As we’ve noted, Evan and Avi argue that the arbitration
        award should be vacated on either of two grounds: (1) the chair-
        person of the arbitration panel failed to disclose information that

        3 We granted the motion to substitute the Goldman Sachs Trust Company,

        N.A., and Patrick Lannon, Esq., Co-Trustees of the Beverly B. Schottenstein
        Revocable Trust U/A/D April 5, 2011, as Plaintiffs-Appellees in this action.
        Substitution Order, ECF No. 53.
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        22-11835               Opinion of the Court                         9

        they say would have created an impression of possible bias on her
        part under 9 U.S.C. § 10(a)(2), and (2) the arbitrators were allegedly
        guilty of misconduct in refusing to postpone the hearing under §
        10(a)(3).
                Courts vacate an arbitrator’s decision “only in very unusual
        circumstances.” Oxford Health Plans LLC v. Sutter, 569 U.S. 564, 568
        (2013) (citation omitted). Indeed, it is “bedrock rule in the law of
        arbitration” that federal courts apply restraint in vacating arbitra-
        tion awards. Grupo Unidos por el Canal, S.A. v. Autoridad del Canal de
        Panama, 78 F.4th 1252, 1261 (11th Cir. 2023), petition for cert. filed
        (U.S. Dec. 15, 2023) (No. 21-14408). This is so because arbitration
        is meant to be “a complete method of dispute resolution, not
        ‘merely a prelude to a more cumbersome and time-consuming ju-
        dicial review process.’” Id. (citation omitted).
               That said, of course, challenges to arbitration awards can
        merit vacatur. But for the reasons we explain below, Evan and Avi
        have not shown that any of the § 10(a) grounds for vacatur apply
        here, and they were not denied a fair hearing.
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        10                     Opinion of the Court                    22-11835

                  A. Solomon’s failure to disclose her State Farm lawsuit did not
                     deprive Evan and Avi of a fair hearing.
               Evan and Avi argue that the arbitration award should be va-
        cated because the arbitration panel’s chairperson, Solomon, failed
        to disclose information that they say would have created an im-
        pression of possible prejudice on her part. Specifically, Solomon
        had filed a breach-of-contract lawsuit against State Farm for deny-
        ing a claim under her homeowner’s insurance policy. And then,
        several months after Solomon’s lawsuit was dismissed, evidence
        was presented during the arbitration proceedings showing that
        Evan had accepted a job with State Farm. Evan argues that a rea-
        sonable person would believe that an arbitrator who recently sued
        State Farm could view its employees as dishonest and could be bi-
        ased against him.
               A federal court may vacate an arbitration award “where
        there was evident partiality . . . in the arbitrators, or either of
        them.” § 10(a)(2). The partiality must be “direct, definite and ca-
        pable of demonstration rather than remote, uncertain and specula-
        tive.” Middlesex Mut. Ins. Co. v. Levine, 675 F.2d 1197, 1202 (11th
        Cir. 1982) (citation omitted). Though the Supreme Court has em-
        phasized the strong policy in favor of leaving arbitration awards
        undisturbed, it has also cautioned that we must be “scrupulous to
        safeguard the impartiality of arbitrators” given that they “have
        completely free rein to decide the law as well as the facts and are
        not subject to appellate review.” Commonwealth Coatings Corp. v.
        Continental Cas. Co., 393 U.S. 145, 149 (1968).
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        22-11835               Opinion of the Court                         11

                We may vacate an arbitration award because of the “evident
        partiality” of an arbitrator only when either “(1) an actual conflict
        exists, or (2) the arbitrator knows of, but fails to disclose, infor-
        mation which would lead a reasonable person to believe that a po-
        tential conflict exists.” Gianelli, 146 F.3d at 1313. Evan and Avi do
        not claim that an actual conflict exists, so we consider whether they
        have established the second basis for vacatur because of an arbitra-
        tor’s “evident partiality.”
               To satisfy the standard for vacatur of an arbitration award
        based on “evident partiality,” a party must show (1) the arbitrator
        knew of the facts creating a potential conflict; (2) the potential con-
        flict was one that a reasonable person would recognize; and (3) the
        arbitrator failed to disclose the conflict. Univ. Commons-Urbana, Ltd.
        v. Univ. Constructors Inc., 304 F.3d 1331, 1341 (11th Cir. 2002). Here,
        all agree that Solomon was aware that Evan had accepted a job at
        State Farm and that Solomon did not disclose her lawsuit against
        State Farm. The dispute focuses on whether a reasonable person
        would recognize potential partiality.
               Here, no reasonable person would believe that Solomon
        was prejudiced against Evan and Avi because Evan had accepted a
        job at State Farm. State Farm was not a party to the arbitration,
        was not involved in the events leading up to the dispute, and was
        mentioned only twice over the 145 hours of hearing sessions. Plus,
        Solomon’s lawsuit was dismissed nearly five months before the fi-
        nal hearing in the arbitration even began. And there is no evidence
        that Solomon’s lawsuit was so contentious that she would view
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        12                      Opinion of the Court                   22-11835

        every single State Farm employee or prospective employee as be-
        ing untrustworthy for the rest of her life. Given the remoteness of
        State Farm to the arbitration, compounded by the fact that the
        State Farm litigation had concluded months before the final arbi-
        tration hearing began, no reasonable person would have believed
        a potential conflict existed.
               The cases cited by Evan and Avi do not help them. For in-
        stance, the brothers rely on a case where the arbitrator’s father was
        an executive of an international union whose local affiliate was a
        party to the arbitration. Morelite Const. Corp. v. N. Y. C. Dist. Council
        Carpenters Ben. Funds, 748 F.2d 79, 84 (2d Cir. 1984). Morelite differs
        from the brothers’ case because (1) the arbitrator’s close relative
        was a controlling member of (2) a party to the arbitration, and (3)
        that close relative’s involvement with a party to the arbitration was
        ongoing throughout the arbitration. Here, on the other hand, (1)
        Evan was not an executive with State Farm (or even yet actively
        employed as a line employee by State Farm); (2) State Farm was
        not a party to the arbitration; and (3) Solomon’s lawsuit against
        State Farm ended nearly five months before the final hearing in the
        arbitration began.
               Evan and Avi also cite a case where the arbitrator became an
        executive at a company that was negotiating with one of the exec-
        utives of a party to the arbitration. New Regency Prods., Inc. v. Nip-
        pon Herald Films, Inc., 501 F.3d 1101, 1107 (9th Cir. 2007). New Re-
        gency doesn’t help the brothers because, unlike in that case, here,
        (1) neither the arbitrator (Solomon) nor a party to the arbitration
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        22-11835               Opinion of the Court                        13

        (Evan) was in the process of becoming an executive (which, unlike
        a line employee, could make decisions controlling the company’s
        policy) at (2) a company that was in ongoing negotiations with (3)
        a party to the arbitration. Indeed, State Farm was never a party to
        the arbitration.
               And the case the brothers argue is “directly on point” con-
        cerned an arbitrator who was involved in separate, ongoing litiga-
        tion between his employer and a party to the arbitration. Sun Re-
        fining & Marketing Co. v. Statheros Shipping Co. of Monrovia, Liberia,
        761 F. Supp. 293, 302–303 (S.D.N.Y. 1991), aff’d, 948 F.2d 1277 (2d
        Cir. 1991). But that case also differs materially from Evan and Avi’s
        case. Unlike in Sun Refining, the arbitrator at issue here (Solomon)
        (1) was not involved in ongoing litigation with (2) a party to the
        arbitration. Rather, (1) the litigation Solomon had initiated against
        State Farm had ended almost five months before the final arbitra-
        tion hearing began, and (2) State Farm was not a party to the arbi-
        tration, and Evan had not been offered a policy-controlling position
        at State Farm that could be viewed as State Farm itself.
                At bottom, too much separation exists between Solomon’s
        relationship with State Farm and the parties to the arbitration. As
        we’ve noted, Solomon’s lawsuit against State Farm ended months
        before the final arbitration hearing began and Solomon heard for
        the first time that State Farm had extended Evan a non-executive
        employment offer. Plus, Evan’s acceptance of a job at State Farm
        was not a major point in the arbitration. Based on these circum-
        stances, assuming that Solomon was prejudiced against all future
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        14                     Opinion of the Court                 22-11835

        property-insurance employees of State Farm would be purely spec-
        ulative. And that is not enough.
                Evan and Avi further argue that Solomon violated FINRA
        disclosure rules by failing to disclose her State Farm lawsuit. Those
        FINRA requirements are separate and apart from the standards this
        Court applies when considering whether to vacate an award. The
        controlling question here is not whether Solomon complied with
        FINRA rules, but rather whether her undisclosed lawsuit against
        State Farm caused evident partiality. While a FINRA violation
        could require vacatur under § 10(a)(2), this is not one of those times
        for the reasons we’ve already discussed—namely, that no reasona-
        ble person could believe that Solomon’s concluded lawsuit against
        arbitration non-party State Farm would have rendered her biased
        against the brothers because Evan had accepted an employment
        offer from State Farm.
               In the alternative, Evan and Avi ask us to remand the case
        for discovery and an evidentiary hearing to probe the extent of Sol-
        omon’s relationship with State Farm and her excuse for not disclos-
        ing the lawsuit. In some cases, an evidentiary hearing may be nec-
        essary to reveal the nature of a relationship between an arbitrator
        and a party related to the arbitration, including the number and
        type of contacts. See, e.g., Univ. Commons-Urbana, 304 F.3d at 1341–
        43 (ordering an evidentiary hearing because there were at least two
        allegations of evident partiality that had merit but an undeveloped
        factual record). Here, the parties do not dispute that Solomon filed
        a breach-of-contract lawsuit against State Farm related to property
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        22-11835                Opinion of the Court                            15

        insurance while the arbitration was pending, or that Evan later tes-
        tified that he had accepted a job at State Farm related to property
        insurance. No additional information would be helpful to deter-
        mining whether Solomon’s lawsuit against State Farm created a
        conflict beyond the facts the parties agree to. Thus, we deny the
        request to remand for an evidentiary hearing.
                   B. The arbitrators did not engage in misconduct under §
                      10(a)(3) when they declined to postpone the final hear-
                                               ing.

               Evan and Avi also ask us to vacate the arbitration award be-
        cause the arbitrators denied their request to postpone the final
        hearing and instead conducted virtual proceedings. They argue
        that the panel had no reasonable basis to decline to postpone the
        hearing because the benefits (expeditiously resolving the dispute,
        especially in light of Beverly’s advanced age) did not outweigh the
        harms (conducting a virtual final hearing even though FINRA rules
        did not expressly allow it and allegedly impeding their ability to
        present third-party evidence).
                The brothers further argue that the arbitration panel’s denial
        of their request to postpone the proceedings prejudiced them be-
        cause it was impossible to enforce subpoenas against Alexis and
        Wells Fargo. Specifically, they assert that our decision in Managed
        Care Advisory Group LLC v. CIGNA Healthcare, Inc., which predated
        COVID-19 and the widespread reliance on virtual proceedings, re-
        stricts an arbitrator’s subpoena power “to situations in which the
        nonparty has been called to appear in the physical presence of the
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        16                     Opinion of the Court                 22-11835

        arbitrator,” thereby barring subpoena enforcement at the virtual
        final hearing. 939 F.3d 1145, 1159 (11th Cir. 2019) (citation omit-
        ted) (emphasis added).
              We are not persuaded.
               The Federal Arbitration Act provides that federal courts may
        vacate arbitration awards “where the arbitrators were guilty of mis-
        conduct in refusing to postpone the hearing, upon sufficient cause
        shown.” § 10(a)(3). The party requesting vacatur bears the burden
        of proving a violation. Riccard v. Prudential Ins. Co., 307 F.3d 1277,
        1289 (11th Cir. 2002).
               In resolving the brothers’ claim, we must first consider
        whether the arbitration panel had “any reasonable basis” for declin-
        ing to postpone the hearing. Schmidt v. Finberg, 942 F.2d 1571, 1574
        (11th Cir. 1991). In Schmidt, we held that vacatur was not war-
        ranted because the arbitration panel may have had several reasons
        for declining to postpone the hearing, including an interest in the
        expeditious handling of disputes and the fact that the party seeking
        the postponement did not explain in any detail what evidence it
        would have presented had the hearing been postponed. Id. at
        1574–75.
               As in Schmidt, here, the arbitration panel had a reasonable
        basis for denying the request to postpone the hearing. For starters,
        Beverly demanded arbitration on July 24, 2019, and the panel
        scheduled the parties’ final evidentiary hearing to begin on October
        19, 2020—almost eighteen months later. The panel may have
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        22-11835               Opinion of the Court                         17

        decided that a postponement would “violate the policy of expedi-
        tious handling of such disputes.” Id. at 1574.
               Though this was the only reasonable basis that the district
        court mentioned in affirming the award, we can affirm its judg-
        ment “on any ground that finds support in the record.” Grange Mut.
        Cas. Co., 958 F.3d at 1056. And here, several other reasonable bases
        supported the arbitration panel’s decision not to postpone the hear-
        ing. For instance, Beverly was 93 years old when she submitted
        her statement of claim to FINRA on July 25, 2019. FINRA has “rec-
        ognized a need for expedited hearings in arbitrations involving”
        seniors and has “encouraged [arbitrators] to consider the health
        and age of a party when . . . [c]onsidering postponement requests.”
        Expedited Proceedings for Seniors & Seriously Ill, FINRA (last visited
        Jan. 7, 2024), http://www.finra.org/arbitration-mediation/rules-
        case-resources/special-procedures/expedited-proceedings-seniors-
        seriously-ill [https://perma.cc/9SW4-5T3E]. So while the interest
        in expeditious resolution of disputes exists in every matter, it is es-
        pecially important when the claimant is elderly.
                The arbitration panel also had to decide whether to move
        the hearing to a virtual platform in fall 2020 or hold out hope that
        the pandemic would abate enough to allow in-person hearings by
        spring 2021. If in-person proceedings were not possible or safe for
        the people involved in this arbitration by spring, then the hearing
        would have been on a virtual platform, anyway. Especially given
        that Beverly was, at that point, 94 years old and therefore at greater
        risk from COVID-19 even if in-person hearings could resume, the
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        18                     Opinion of the Court                  22-11835

        panel could have reasonably decided that postponing the hearing
        for five months on the off chance that in-person proceedings could
        resume made little sense.
               Evan and Avi argue that those reasons do not outweigh the
        fact that FINRA’s Rules did not expressly allow remote proceedings
        and that holding a virtual hearing allegedly allowed Alexis and
        Wells Fargo to argue that enforcing their subpoenas was impossi-
        ble under Managed Care. But the test is not whether we, sitting on
        review, would have made the same decision as the panel. Rather,
        we ask only whether the panel had a reasonable basis to deny the
        postponement. And here, it surely did.
               Plus, even when a panel had no reasonable basis to deny
        postponement, we vacate an award only when the arbitrators’
        choice “prejudice[d] the rights of the parties and denie[d] them a
        fair hearing.” Robbins v. Day, 954 F.2d 679, 685 (11th Cir. 1992), dis-
        approved on other grounds by First Options of Chicago, Inc. v. Kaplan,
        514 U.S. 938 (1995). Here, that did not happen.
               Evan and Avi posit on appeal that the decision not to post-
        pone prevented them from presenting specific evidence from
        Alexis and Wells Fargo. But their request to the panel for a post-
        ponement referred only generally to evidence from “non-FINRA
        member third parties” without specifically naming Alexis or Wells
        Fargo. In Schmidt, we found no misconduct by the panel in declin-
        ing to postpone the hearing when the party seeking postponement
        “did not express a single word to indicate what testimony [the po-
        tentially absent witness] would give that would be material to the
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        22-11835               Opinion of the Court                        19

        issues raised in the claim.” 942 F.2d at 1574. Evan and Avi’s request
        here similarly included not a single word about what specific testi-
        mony would be excluded. Perhaps the arbitration panel may have
        been able to perceive that Evan and Avi sought to postpone so they
        could obtain testimony from Alexis and Wells Fargo to show that
        the allegations were fabricated. But given that Evan and Avi
        claimed Pattap worked together with Alexis, “the panel could rea-
        sonably have believed that whatever testimony need be given . . .
        could be given by” Pattap. Id. And indeed, Pattap testified at the
        hearing as to the creation of the allegations.
                Not only that, but the brothers have not shown that they
        would have been able to compel Alexis and Wells Fargo’s presence
        at the final hearing even if the final hearing had been in the spring
        of 2021, which is when they sought to postpone it until. To be sure,
        prejudice can occur when an arbitration panel’s refusal to postpone
        a hearing prevents a party from introducing material, noncumula-
        tive evidence from key witnesses. See Tempo Shain Corp. v. Bertek,
        Inc., 120 F.3d 16, 20–21 (2d Cir. 1997). But it was the virtual nature
        of the hearing that prevented enforcement of the subpoenas
        against Alexis and Wells Fargo. And even if the arbitration panel
        had granted the brothers’ request and postponed the hearing until
        spring 2021, the brothers have not shown that the hearing would
        have been in person, anyway. So they’ve failed to show that Alexis
        and Wells Fargo would have been able to have been compelled to
        appear in spring 2021. In other words, Evan and Avi have not
        shown prejudice.
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        20                    Opinion of the Court                 22-11835

                As to Evan and Avi’s complaint that FINRA Rules did not
        expressly authorize a virtual proceeding, that fares no better. To
        be clear, the brothers have not sought vacatur under § 10(a)(4)
        based on their argument that the panel exceeded its authority in
        conducting a virtual proceeding. Rather, they argue that the fact
        that FINRA did not expressly sanction virtual proceedings through
        its rulemaking process means that the panelists had no reasonable
        basis to deny the postponement of the hearing. But as of March 27,
        2020, FINRA Dispute Resolution expressly offered virtual hearing
        services to parties “by joint agreement or by panel order.” And
        Evan and Avi’s request for postponement consented to a virtual
        hearing in spring 2021, in any case. So it was not unreasonable for
        the arbitrators to deny the postponement.
              In short, the arbitration panel had a reasonable basis to deny
        the request to postpone the hearing. And Evan and Avi’s rights
        were not prejudiced by the decision to conduct a virtual hearing.
        Because the panel had a reasonable basis to deny the request to
        postpone the hearing, and the denial did not result in prejudice in
        any case, this ground for vacatur fails.
                                IV.   CONCLUSION

              We AFFIRM the district court’s denial of the motion to
        vacate the arbitration award.