Grupo Unidos por el Canal SA et al v Autoridad del Canal de Panama - United States Supreme Court Docket No 23-660 - Reply of petitioners Grupo Unidos por el Canal SA - 5 March 2024
Country
Year
2024
Summary
INTRODUCTION
Respondent attempts to diminish but cannot dispute that the lower courts are in open conflict over the meaning of the FAA's evident partiality standard.
That split is widely acknowledged by courts and commentators. It is deep-seated, with (a) at least five circuits following the Second Circuit standard requiring vacatur only if a court would have to conclude an arbitrator was partial, (b) the Ninth Circuit requiring only a reasonable impression of possible bias, and (c) the Eleventh Circuit falling in-between, parroting the Ninth Circuit's standard but applying the Second's. Pet. 17-23. This alone warrants review. Arbitration is the cornerstone of international commercial dispute resolution. And the circuit courts are in open conflict over the most fundamental aspect of that international arbitral regime: the right to disclosure of potential conflicts so that a party can make an informed decision to consent, or not, to the arbitrators deciding the case.
This conflict also implicates this Court's authority to issue decisions that bind the country on questions of federal law. The reason the circuits have divided is because the Second Circuit and others have concluded that this Court's opinion in Commonwealth Coatings Corp. v. Continental Casualty Co., 393 U.S. 145 (1968)-- joined by six justices--was, in fact, a plurality opinion, because they (erroneously) found a conflict between the majority opinion and Justice White's concurrence. That lower-court second-guessing of the facial validity of this Court's binding pronouncements, if allowed to stand, risks undermining the stability of the vertical authority upon which our judiciary rests.
There is therefore no doubt that this case warrants plenary review. Each of Respondent's efforts to show otherwise fails. First, it argues that the circuit conflict is mere wordplay. Nonsense. Courts do not openly acknowledge conflicts where it does not matter. The fact that they have done so here, repeatedly, shows the importance of this recurring issue.
Second, Respondent asserts the conflict does not matter here, because the outcome would be the same under either standard. Not so. The Eleventh Circuit's own prior decisions show how the Ninth Circuit's standard, properly applied, requires a different result.
Regardless, given the fact-intensive nature of these disputes, it is critical that courts apply the right--and same--legal rule. Otherwise, there is no hope that courts will treat like cases alike, one of the central promises of the Rule of Law.
Third, Respondent argues that the court below was correct. Wrong again, and also irrelevant. Here, the Eleventh Circuit sanctioned one party's four-time wing arbitrator secretly helping to award the arbitral president a lucrative appointment in the middle of this case--without even the president disclosing it. And another arbitrator secretly served alongside Respondent's lawyer as co-arbitrators during these proceedings. Both dealings obviously should have been disclosed. Neither was. But regardless, courts across this country should decide that issue under the same legal standard; the outcome should not turn on whether the appeal is heard in New York City, San Francisco, or Miami.
In short, the circuits are in disarray, the decision below is wrong, and this is an ideal vehicle to address the important and recurring questions presented. This Court should grant certiorari.