Hruban v. Steinman ( 2002 )

Opinions of the United
2002 Decisions States Court of Appeals
for the Third Circuit
7-25-2002
Hruban v. Steinman
Precedential or Non-Precedential: Non-Precedential
Docket No. 01-2277
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Recommended Citation
"Hruban v. Steinman" (2002). 2002 Decisions. Paper 442.
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NOT PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
No. 01-2277
JOSEPH J. HRUBAN,
Appellant
v.
BARRY F. STEINMAN
ON APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE
EASTERN DISTRICT OF PENNSYLVANIA
(District Court No. 00-CV-04285)
District Court Judge: Honorable Eduardo C. Robreno
Argued on June 24, 2002
Before: BECKER, Chief Judge, ALITO and AMBRO, Circuit Judges.
MICHAEL K. CORAN (Argued)
MICHAEL A. IACONELLI
Klehr, Harrison, Ha
Ellers, LLP
260 South Broad Street
Philadelphia, PA 19102
Counsel for Appellant
MERRILL G. DAVIDOFF
ERIC L. CRAMER (Argued)
JENNA MACNAUGHTON-WONG
Berger & Montague, P.C.
1622 Locust Street
Philadelphia, PA 19103
Counsel for Appellee
OPINION OF THE COURT
PER CURIAM:
In this appeal, Joseph Hruban challenges the decision of an arbitration panel of the
National Association of Securities Dealers to award Barry Steinman over $1 million for
his claims arising under Pennsylvania’s Wage Payment and Collection Law, 43 Pa. Stat.
260. The District Court denied Hruban’s complaint seeking to upset the arbitrators’
award. Under the deferential standard by which this Court must review the arbitrators’
decision, we affirm.
The facts of this case are well known to the parties. Because we write only for
their benefit, we will not belabor the factual and procedural background. This Court
exercises plenary review over the District Court’s grant of Steinman’s motion under Fed.
R. Civ. P. 12(b)(6) to dismiss Hruban’s complaint.
We review decisions of an arbitration panel under a highly deferential standard.
The grounds upon which this Court may vacate an arbitration award are "narrow in the
extreme." Amalgamated Meat Cutters & Butcher Workmen of N. Am., Local 195 v.
Cross Brothers Meat Packers, Inc., 518 F.2d 1113, 1121 (3d Cir. 1975). It is not the
proper role of the court to "sit as the [arbitration] panel did and reexamine the evidence
under the guise of determining whether the arbitrators exceeded their powers." Mutual
Fire, Marine, & Inland Ins. Co. v. Norad Reins. Co., Ltd., 868 F.2d 52, 56 (3d. Cir.
1989). In particular, Hruban invokes three grounds for vacatur recognized in prior
Circuit precedent: (1) the panel exceeded its powers, (2) the panel displayed a manifest
disregard of the law, and (3) the panel’s decision was contrary to public policy.
First, to determine whether arbitrators exceeded their powers, this Court has
employed a two-step analysis: (a) the form of the award must be rationally derived either
from the agreement between the parties or from the parties’ submission to the arbitrators,
and (b) the terms of the award must not be "completely irrational." Mutual Fire, 868
F.2d at 56. A second possible ground for vacatur is "manifest disregard of the law."
Kaplan v. First Options of Chicago, 19 F.3d 1503, 1520 (3d Cir. 1994); see also First
Options of Chicago v. Kaplan, 514 U.S. 938, 942 (1995).
Third, to warrant vacatur on public policy grounds under our prior cases, the
arbitration award must "violate[] a ’well-defined and dominant’ public policy, which we
must ’ascertain[] by reference to the laws and legal precedents and not from general
considerations of supposed public interests.’" Exxon Shipping Co. v. Exxon Seamen’s
Union, 993 F.2d 357, 360 (3d Cir. 1993) (quoting W.R. Grace & Co. v. Local Union
759, Int’l Union of Rubber Workers, 461 U.S. 757, 766 (1983)). See also Buckhannon
Bd. and Care Home, Inc. v. West Virginia Dept. of Health & Human Res., 532 U.S. 598
(2001).
Under the standard of review we are bound to follow, Hruban fails to establish
any grounds for vacatur. However, Hruban urges this Court to "change the standard of
review." Appellant’s Br. at 60. Hruban argues for a broader standard to allow "greater
judicial involvement in the review process relating to arbitration awards." Id. at 59. In
light of the relevant precedents of the Supreme Court and this Circuit, we decline to
adopt the broader standard of review Hruban advocates. We affirm the District Court’s
decision and sustain the arbitrators’ award to Steinman.