Hall Street Associates, L.L.C. v. Mattel Inc.

MEMORANDUM *

This appeal of the district court’s refusal to enforce an arbitration award is before us for the second time. See Hall St. Assoc., LLC v. Mattel Inc., 113 Fed.Appx. 272 (9th Cir.2004). Initially, we reversed the district court for using an improper standard of review and provided instructions to enforce the arbitration award unless grounds for not doing so existed under either 9 U.S.C. §§ 10 or 11. Id. at 272 . On remand, the district court again failed to enforce the arbitration award, this time because it was “implausible.” Implausibility is not a valid ground for avoiding an arbitration award under either 9 U.S.C. §§ 10 or 11.

Although the arbitrator’s assessment of the merits in this case contains possible errors of law, those errors are not a sufficient basis for a federal court to overrule an arbitration award. See Employers Ins. of Wausau v. Nat’l Union Fire Ins. Co. of Pittsburgh, 933 F.2d 1481 , 1486 (9th Cir.1991) (‘We may not predicate reversal on ... erroneous findings of fact or conclusions of law.”); see also Hawaii Teamsters and Allied Workers Union, Local 996 v. United Parcel Serv., 241 F.3d 1177, 1181 (9th Cir.2001) (“Our task *478 is, in essence,…

dissenting:

I respectfully dissent because, although the majority correctly identifies the governing legal principles, I conclude that the arbitrator’s decision was completely irrational.

Paragraph 12(a) of the Lease provides, as relevant here, that “Tenant shall comply with all federal, state and local environmental laws and regulations in its use of the Premises.” Paragraph 12(c) of the Lease provides that the tenant shall not be held liable for certain items “[t]o the extent Tenant has been in compliance with applicable environmental laws.” In context, the only rational reading of the phrase “applicable environmental laws” in Paragraph 12(c) is as shorthand for “all federal, state and local environmental laws and regulations in [Tenant’s] use of the Premises,” the longhand description just given in Paragraph 12(a). That is, any environmental law with which the tenant was required to comply in its use of the premises was “applicable” within the meaning of Paragraph 12 as a whole. Paragraph 12(b) confirms the necessity of interpreting “applicable” in this way because it provides that the tenant “assumes all responsibility for the investigation and cleanup” of any hazardous…