United States District Court, W.D. Wisconsin
OPINION AND ORDER
Stephen L. Crocker Magistrate Judge.
lawsuit brought under the court's diversity jurisdiction,
plaintiff EuroChem Trading USA Corporation
(“ECTUS”) seeks to collect more than $14 million
in unpaid invoices for agricultural product that it delivered
to WSAG Center, Inc. (“WSAG”), an agri-business
controlled by defendant W. Kent Ganske. All of the purchase
contracts contained a provision specifying that, in the event
the parties failed to settle their disputes under the
contract, any dispute would be referred to arbitration-
in accordance with the rules of the Society of Marine
Arbitrators (hereinafter referred to as “the
SMA”) and the procedures set forth below. The
jurisdiction of the regular courts shall be excluded . . .
The dispute shall be settled by a sole arbitrator appointed
by the SMA on the basis of the provisions of the present
Contract as well as the laws of the State of Florida. The
award shall be rendered in accordance with the Arbitration
Rules of the SMA and be final and binding upon both parties.
The award shall contain the amount and the apportionment of
the Arbitration costs.
13, 2017, ECTUS served an arbitration demand on WSAG pursuant
to the terms of the contracts. On September 6-7, 2018, an
evidentiary hearing was held before arbitrator Michael Young.
Young heard testimony from five witnesses and accepted 175
exhibits into the record. On January 2, 2019, Young issued a
Partial Final Award, awarding ECTUS compensatory damages of
$14, 283.519.42, plus pre-judgment interest. At Young's
request, the parties submitted briefs regarding ECTUS's
entitlement to an award of attorneys' fees and costs and
the calculation of pre-judgment interest on the amount
receiving and considering the parties' submissions, on
March 6, 2019, Young issued his Final Award, awarding ECTUS
the following: (1) $14, 283, 519.42 in compensatory damages;
(2) $1, 124, 040.03 in prejudgment interest (which continues
to accrue at the rate of$2, 477.12 per day during the year
2019 and adjusted by Florida statute thereafter); (3) $182,
498.96 in attorneys' fees; and (4) $34, 000 in costs, for
a total final award of $15, 624, 058.41.
now asks this court to confirm the arbitration award and
enter judgment against WSAG accordingly. Dkt. 80. WSAG
opposes confirmation of the Final Award and has filed its own
motion to vacate or modify it on various grounds, but none of
WSAG's arguments has any traction. Dkts. 82, 105.
Accordingly, ECTUS's motion for confirmation of the Final
Award will be granted.
petitions the court to confirm the arbitration award under
Section 9 of the Federal Arbitration Act, which provides:
If the parties in their agreement have agreed that a judgment
of the court shall be entered upon the award made pursuant to
the arbitration, and shall specify the court, then at any
time within one year after the award is made any party to the
arbitration may apply to the court so specified for an order
confirming the award, and thereupon the court must grant such
an order unless the award is vacated, modified, or corrected
as prescribed in sections 10 and 11 of this title. If no
court is specified in the agreement of the parties, then such
application may be made to the United States court in and for
the district within which such award was made.
9 U.S.C.A. § 9. WSAG objects to confirmation, and
instead asks the court to either vacate the award under
§ 10 or modify it under § 11.
from the specific grounds articulated in Sections 10 and 11,
a federal court has no authority to set aside an arbitration
award even if the arbitrator “committed serious
error” or issued a decision that is “incorrect or
even whacky.” Johnson Controls, Inc. v. Edman
Controls, Inc., 712 F.3d 1021, 1025 (7th Cir.
2013) (internal citation omitted). See also Chicago
Typographical Union No. 16 v. Chicago Sun-Times, Inc.,
935 F.2d 1501, 1504-05 (7th Cir. 1991) (federal
courts do not review the soundness of arbitration awards, but
only look to make sure the arbitrator upheld the parties'
agreement to arbitrate). If none of the grounds set forth in
Sections 10 or 11 applies, then the court “must
grant” an order confirming the award. Hall St.
Assocs., L.L.C. v. Mattel, Inc., 552 U.S. 576, 587
argues that the court should refuse to confirm the award for
lack of jurisdiction. In the alternative, it argues that
vacatur or remand is warranted because: (1) the arbitrator
applied the rules of the Society of Maritime
Arbitrators, not the rules of the Society of Marine
Arbitrators, as called for by the Contracts, and therefore
the award should be vacated under 9 U.S.C. § 10(a)(4) or
modified under § 11(a); (2) the arbitrator
“refused to hear evidence pertinent and material to the
controversy” when he failed to hold an evidentiary
hearing on WSAG's objection to ECTUS's proposed
attorney's fees, justifying vacatur under §
10(a)(3); (3) the arbitrator made a “material
miscalculation of figures” warranting modification
under § 11(a); and (4) the arbitrator imperfectly
executed his powers when he refused to consider parol
evidence about the parties' course of dealing, warranting
vacatur under § 10(a)(4). I address each argument in turn.
argues that this court has no authority to confirm the Final
Award because the parties did not explicitly consent to
judicial confirmation in the Contracts. This argument is
foreclosed by Seventh Circuit precedent. In Milwaukee
Typographical Union No. 23 v. Newspapers, Inc., 639 F.2d
386, 389-90 (7th Cir.), cert. denied, 454
U.S. 838 (1981), the court held that the parties need not
explicitly agree to judicial confirmation of an award in
order to confer such consent, so long as they agree that any
arbitration decision will be “final and binding”
upon both parties. See also Daihatsu Motor Co. v. Terrain
Vehicles, Inc., 13 F.3d 196, 202 (7th Cir.
1993) (finding consent-to-confirmation under § 9 where
parties agreed that disputes would be “finally
settled” by arbitration). Other circuits, although not
all, agree that the parties' agreement to submit their
disputes to “final and binding” arbitration
strongly implies consent to judicial confirmation. See,
e.g. Booth v. Hume Pub., Inc., 902 F.2d 925, 930
(11th Cir. 1990) (provision in employment
agreement that arbitrator's determination would be final
and binding, along with Hume's full participation in the
arbitration process, was sufficient under the FAA to confer
authority on the district court to confirm the award);
Kallen v. District 1199, National Union of Hospital and
Health Care Employees, 574 F.2d 723, 726 (2d Cir. 1978)
(where language of agreement provided that arbitration would
be final and binding, appellant participated fully in
arbitration process, and federal law would apply to
interpretation of underlying agreement, the district court
had authority under § 9 of the Act to enter judgment on
the award); but see Higgins v. U.S. Postal Service,
655 F.Supp. 739, 744 (D. Maine 1987) (refusing to find that
the “final and binding” language standing alone,
without conduct from which an agreement could be inferred,
was sufficient for relief under § 9 of the Act).
is no dispute that the parties' Contracts in this case
specified that the arbitrator's award shall be
“final and binding” upon the parties. Moreover,
WSAG participated fully in the arbitration process. Under the
law of this circuit, this is enough to confer jurisdiction on
this court to confirm the arbitration award.