1. Ethics in Arbitration
Dan Kolb
Edna Sussman

2. Ethics Standards Apply to Arbitrators and Counsel
Applicable Standards for Arbitrators:
Domestic Standards
Model ABA Standards
Provider standards
AAA
JAMS
CPR
If the Netural is a Lawyer Applicable Code of Professional Responsibility where admitted and for the seat of the Arbitration.
International Standards
I.C.D.R.
IBA Standards
Chartered Institute of Arbitrators Standards
I.C.C. Standards
Ethical Requirements for Lawyers in other Countries

3. Applicable Standards for Advocates
Applicable Codes of Responsibility:
For State where admitted
At the seat of the Arbitration

4. Unauthorized Practice Of Law In Arbitration
Absent an express requirement requiring pro hac vice admission, to serve as Arbitrator or counsel in an arbitration lawyers typically need not be admitted to practice in the jurisdiction that is the seat of the arbitration. See New York Rule 5.5: Unauthorized Practice of Law; Multi- Jurisdictional practice of law: …
c) A lawyer admitted in another United States jurisdiction, and not disbarred or suspended from practice in any jurisdiction, may provide legal services on a temporary basis in this jurisdiction that:
. . .
(3) are in or reasonably related to a pending or potential arbitration, mediation, or other alternative resolution proceeding in this or another jurisdiction, if the services arise out of or are reasonably related to the lawyer's practice in a jurisdiction in which the lawyer is admitted to practice and are not services for which the forum requires pro hac vice admission
Parties may be represented in an international arbitration by whoever they select. See I.C.D.R. Article 12, Representation.

5. Arbitrator Impartiality Is Essential to the Process
An award can be set aside for evident bias.
The Arbitrator and the Arbitrator’s family should not have a financial or other personal interest in the outcome.
Important for arbitrators to protect the award by assuring appropriate disclosure.
It is good practice to disclose all known relationships with Parties, Counsel, and other Arbitrators even though they may not show evident bias.
Maintaining independence and disclosure are ongoing obligations during the arbitration.
A Party made aware of an issue waives if there is no objection. AAA Commercial Arbitration Rules R-37. Waiver of Rules. “Any party who proceeds with the arbitration after knowledge that any provision or requirement of these rules has not been complied with and who fails to state an objection in writing shall be deemed to have waived the right to object.”
If an issue is raised during the arbitration providers typically decide initially whether there is evident bias.

6. “Reasonable Inquiry” Is Necessary So That Disclosure Is Appropriate
The Arbitrator should search for information that would likely indicate evident bias.
Where there may be an issue as to possible connections or associations that would not show evident bias an extensive and burdensome search is not necessary, even though the same connections or associations would be disclosed if recalled.
Prior associations through Bar Associations.
Parties or Counsel in litigation many years back.
Possible non-compromising contacts on social media.
It is good practice to keep good records of prior involvement with Parties, Counsel and Experts as a neutral.
It is good practice to disclose to the Parties and counsel the limits on any search.
Not searching all prior cases.
Not searching all prior Bar Committees.
Not disclosing all social media – friends/connections.

7. Scandinavian Re v. Saint Paul, 668 F.3d 60 (2d Cir. 2012)
Second Circuit considered vacature of a reinsurance arbitration award resulting from two ARIAS arbitrators’ non-disclosure of their concurrent appointment to another arbitration.
The District Court vacated the award, finding that the second arbitration involved similar subject matter, parties and a common witness. The Court stated that:
The arbitrators put themselves in a position where they could obtain ex parte information about some of the issues in question in the arbitration, and that the concurrent service "constituted a material conflict of interest," that met the evident partiality standard under the Federal Arbitration Act.
The Second Circuit reversed:
“[E]vident partiality…will be found where a reasonable person would have to conclude that an arbitrator was partial to one party to the arbitration."  
The arbitrators’ overlapping service did not constitute a material relationship with a party that would reflect the possibility of bias in favor of or against a party.
“[N]ondisclosure does not by itself constitute evident partiality.” The proper focus is instead on whether the facts that were not disclosed suggest a material conflict of interest." 
“A party is not entitled to the complete and unexpurgated business biographies of the arbitrators whom the parties have selected." 

8. Freeman v. Pittsburgh Glass Works, LLC, 709 F.3d 240 (3d Cir. 2013)
Vacature was sought as to an arbitration award that denied the claimant’s ADEA claim, alleging that::
The arbitrator failed to disclose that senior employees of the employer contributed to the arbitrators campaign to be elected to the Pennsylvania Supreme Court.
The arbitrator taught a law school course with an in-house counsel for the employer, which she also failed to disclose.
The District Court denied the motion to vacate, holding that the matters not disclosed were neither substantial nor material.
The Third Circuit upheld the District Court, concluding that:
"An arbitrator is evidently partial only if a reasonable person would have to conclude that she was partial to one side.“
No reasonable person would conclude that the arbitrator was partial.
The employer had made campaign contributions to the arbitrator’s election campaign, but so had the employee’s lawyer in amounts that were larger than the employer’s employees.

9. U. S. Electronics, Inc. v. Sirius Satellite Radio, Inc. 17 N. Y
U.S. Electronics, Inc. v. Sirius Satellite Radio, Inc. 17 N.Y.3d 912 (N.Y., 2011)
The losing party asked that the award be vacated because the son of the tribunal chair, who was a member of Congress:
Advocated a merger between Sirius and XM Satellite Radio.
Was also politically aligned with another Congressman who was the founder and director of a competitor of U.S. Electronics.
The New York Court of Appeals adopted the Second Circuit’s reasonable person standard:
Evident partiality was not exhibited as a result of “attenuated matters and relationships.”
The connections that were alleged to exist were too tenuous to impute partiality.

10. Port Arthur Steam Energy v
Port Arthur Steam Energy v. Oxbow Calcinating, Harris County, Texas – Cause No
Arbitration award vacated because the arbitrator’s former firm, which had closed in 2001, retained an interest in an active litigation involving one of the lawyers representing a party in the arbitration.
Although the arbitrator had no access to systems that would have permitted him to conduct a conflicts check at his former firm, the Court stated that “he could have called and asked a certain few of his colleagues about pending matters….”

11. Johnson Controls, Inc. v. Edman Controls, Inc. , --- F
Johnson Controls, Inc. v. Edman Controls, Inc., --- F.3d ----, 2013 WL (7th Cir. 2013)
Sanctions for Motions to Vacate Arbitration Awards
A motion to vacate an arbitration award based on the argument that the arbitrator exceeded his jurisdiction resulted in strong warning from the 7th Circuit.
“[C]hallenges to commercial arbitral awards bear a high risk of sanctions.”
“Attempts to obtain judicial review of an arbitrator’s decision undermine the integrity of the arbitral process... Edman has been deprived not only of the value of the distributorship it expected to have for Panama, but also part of the value of the arbitration to which both parties agreed.”

12. DigiTelCom, Ltd. v. Tele2 Svergie AB, 2012 WL 3065345 (S.D.N.Y., 2012)
Sanctions for Motions to Vacate Arbitration Awards
The District Court stated in denying a motion to vacate the arbitration award, and awarding sanctions that:
The arbitrators “merely interpreted [the contracts] in terms that were unfavorable to [DigiTelCom].” 
“Litigants must be discouraged from defeating the purpose of arbitration by bringing such petitions based on nothing more than dissatisfaction with the tribunal’s conclusions.”
The attempt to vacate was “an assault on the [arbitration] tribunal’s fact finding and contractual interpretation rather than on its actual authority.” 

13. Confidentiality Should Be Maintained By The Arbitrator But Parties Are Often Only Bound by Agreement Or The Arbitrator’s Order
The Ethical Standards of ADR organizations require that an Arbitrator maintain confidentiality.
The AAA Code of Ethics for Arbitrators in a Commercial Dispute provides: “AN ARBITRATOR SHOULD BE FAITHFUL TO THE RELATIONSHIP OF TRUST AND CONFIDENTIALITY INHERENT IN THAT OFFICE. The arbitrator should keep confidential all matters relating to the arbitration proceedings and decision.”
JAMS Rule 21: Confidentiality and Privacy
(a) JAMS and the Arbitrator shall maintain the confidential nature of the Arbitration proceeding and the Award, including the Hearing, except as necessary in connection with a judicial challenge to or enforcement of an Award, or unless otherwise required by law or judicial decision.
(b) The Arbitrator may issue orders to protect the confidentiality of proprietary information, trade secrets or other sensitive information.
(c) Subject to the discretion of the Arbitrator or agreement of the Parties, any person having a direct interest in the Arbitration may attend the Arbitration Hearing. The Arbitrator may exclude any non- Party from any part of a Hearing.

14. Confidentiality Should Be Maintained By The Arbitrator But Parties Are Often Only Bound by Agreement Or The Arbitrator’s Order
CPR Rule 18:  Confidentiality   “Unless the parties agree otherwise, the parties, the arbitrators and the Neutral Organization shall treat the proceedings, any related disclosure and the decisions of the Tribunal, as confidential, except in connection with judicial proceedings ancillary to the arbitration, such as a judicial challenge to, or enforcement of, an award, and unless otherwise required by law or to protect a legal right of a party. To the extent possible, any specific issues of confidentiality should be raised with and resolved by the Tribunal.”
An Arbitrator may have the support of a clerk or other support person if there is disclosure to counsel and the Parties.
AAA Commercial Arbitration Rule 23(a):
“The arbitrator shall have the authority to issue any orders necessary to enforce the provisions of rules R-21 and R-22 and to otherwise achieve a fair, efficient and economical resolution of the case, including, without limitation: (a) conditioning any exchange or production of confidential documents and information, and the admission of confidential evidence at the hearing, on appropriate orders to preserve such confidentiality…”

15. Duty of Honesty and Candor
An Arbitrator should conduct the proceedings fairly. ABA Model Rules Canon 10.
The Advocate has a duty to make no false statement of fact or law to the Tribunal. Model Rules of Professional Responsibility Rule 3.3: Candor Before the Tribunal.