The underlying arbitration involved a dispute between Petitioner Global Liquidity Partners, LLC ("Global"), a "securities execution services firm that . . . us[es] confidential and proprietary technology, software, programs and trading strategies," and Respondents Jeffrey Wegher, a former employee and member of Global, Jennifer Wegher, his wife, and Lynde Point Technologies, LLC ("Lynde Point"), a company of which Mrs. Wegher is the sole member. In the arbitration, Global alleged that the Respondents engaged in a scheme to unlawfully compete with Global's business by misappropriating confidential information in order to start an entity to compete with Global. The arbitration hearing lasted twenty days, at which the parties presented eleven witnesses and about 450 exhibits. The arbitrator then entered an award in favor of Global, which Global moved to confirm. In their cross-motion to vacate, Respondents argued that they were prejudiced because the arbitrator 1) was biased against the Weghers, 2) prevented Mrs. Wegher from having adequate time to present her case, 3) allowed Global to use the majority of the time allotted for the hearing, and 4) exceeded his powers by imposing an injunction on Mrs. Wegher and Lynde Point when no contract existed between Global and Mrs. Wegher or Lynde Point.
Noting that there is a strong presumption under the Federal Arbitration Act in favor of enforcing arbitration awards, the court reviewed each ground upon which Respondents requested that the court vacate the award. First, Respondents alleged that the arbitrator demonstrated bias against them and in favor of Global. The New Jersey federal court noted that in order to vacate an award based on evident partiality, the court must find that the arbitrator more than merely appeared biased. Looking at the facts and arguments made, the court found that Respondents had not met their burden in demonstrating evident partiality. The court also found that that Respondents did not meet their burden that the arbitrator had refused to hear pertinent evidence when each party stated on the record that they had no other evidence to present at the hearing. Finally, with respect to manifest disregard of the law, the court noted that both Mrs. Wegher and Lynde Point consented to the American Arbitration Association's jurisdiction, as well as "expressly acknowledged the potential for permanent injunctive relief and damages." Thus, the court granted Global's petition to confirm the arbitration award, and denied Respondents' cross-motion to vacate the arbitration award.
Global Liquidity Partners, LLC v. Wegher, et al., No.16-2439 (D. N.J. Nov. 30, 2016).
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