Commercial: Failed Attempt to Enjoin Arbitration
Zuckerman, Susan C., Dispute Resolution Journal
Upholding arbitration procedures, the 7th Circuit affirmed an order denying a preliminary injunction of arbitration, and dismissed the plaintiffs suit, which complained of a lack of gender diversity in the arbitral panel.
After the plaintiff sold her controlling interest in a close corporation, the buyer commenced an arbitration against her seeking damages for breach of warranty. The arbitration was filed with the American Arbitration Association under the governing contract. Using one of its "peremptory strikes," the buyer struck the name of the sole woman on the list of potential arbitrators furnished to the parties by the AAA. After a threeperson panel of male arbitrators was selected, the plaintiff filed suit against the arbitration, complaining about the lack of a female arbitrator.
The district court rejected the plaintiff's petition to preliminarily enjoin the arbitration and dismissed the suit for failure to state a claim. The plaintiff appealed, asking for an arbitration before a panel with at least one woman.
The 7th Circuit affirmed. It emphasized that in selecting arbitration the plaintiff had agreed to arbitration procedures and to accept the limited judicial review allowed under the Federal Arbitration Act. The court said, "To allow a party to bring an independent suit to enjoin the arbitration is inconsistent with fundamental procedural principles that apply with even greater force to arbitration than to conventional litigation. …