February 24, 2017 Practice Points

Motion to Vacate Untimely

By Michael S. Oberman

On January 19, 2017, by summary order, the Second Circuit's affirmation in Martin v. Deutsche Bank Securities Inc. reiterated that a petition to vacate an award must be served within three months after the award is filed or delivered (quoting and citing Sec. 12 of the FAA).

In this case, Martin's counsel within the time period emailed counsel for Deutsche Bank attaching a copy of the petition to vacate and asking whether counsel would accept service on behalf of the bank. Deutsche Bank's counsel offered to accept service if given 90 days to respond to the petition. Martin's counsel did not accept that offer. Martin's counsel then effected personal service after the three month period had expired.

The Second Circuit affirmed the district court's dismissal of the petition as untimely. Under Section 12 of the FAA, local law controlled effective service and Federal Rule of Civil Procedure 5 makes email service effective only if the party to be served consents in writing. On this record, the courts found no written consent to accept email service. As a result, the emailing of the petition did not achieve service within the three month period, and the three month period ran without effective service being made.

The obvious lesson is to be mindful of section 12 of the FAA and Rule 5 of the Federal Rules of Civil Procedure when seeking to vacate an arbitration award.

Keywords: Rule 5, Federal Rules of Civil Procedure, section 12, FAA, service, vacate

Michael S. Oberman is counsel with Kramer, Levin Naftalis & Frankel LLP in New York, New York.


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