February 16, 2017 Practice Points

Not Manifest Disregard to Include Attorneys’ Fees in Award

By Brooke L. French

In, Astanza Design, LLC v. Giemme Stile, S.p.A., Case No. 1:16CV1238 (USDC M.D.N.C. Dec. 15, 2016), a federal court confirmed an arbitration award that included attorneys' fees.

The award, which included both damages and attorneys' fees, was entered in favor of Astanza Design, LLC against Giemme Stile, S.p.A. and Giemme USA, LLC (Giemme) in a dispute arising from the parties' agreement that Astanza was to serve as the exclusive representative for Giemme's furniture sales to the LDS Church. Among other things, Giemme contended that the arbitrator lacked authority to award attorneys' fees. The court disagreed.

The parties' contract contemplated that the AAA International Center for Dispute Resolution Rules of Procedure would apply, and Article 34 of those rules provides that the tribunal "shall fix the costs of arbitration in its award." In confirming the award, the court noted that the parties' "bargained for the arbitrator's construction of their agreement" and that an arbitration award "even arguably construing or applying the contract must stand, regardless of this court's view of its merits." The award "drew its essence from the contract and was far from a manifest disregard of the law."

Key words: attorney's fees, AAA, Article 34, manifest disregard

Brooke L. French is a shareholder at Carlton Fields in Atlanta, Georgia.

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