InterDigital Inc (IDCC)

[spencer]

Ghors, you are talking about B.L. Harbert v. Hercules Steel. The following article mentions sanctions, but does not say that the sanctions go beyond attorneys fees.

http://www.adrforum.com/rcontrol/documents/ArticlesByFORUMStaff/2007BrownExperience.pdf

Frivolous Arbitration Appeals Can Lead to Sanctions

Desirous to ensure that parties in arbitration
get the benefits of a faster and less
expensive procedure than litigation, the
11th Circuit issued a stern warning that
it is “ready, willing, and able to consider
imposing sanctions” on those considering
appealing arbitration decisions without
a strong justification under the
manifest disregard of law standard.
The parties in B.L. Harbert Int’l, LLC v.
Hercules Steel Co., 441 F.3d 905 (11th
Cir. 2006) became involved in litigation
over the length of time it took Hercules, a
construction subcontractor, to finish its
work for Harbert. The parties arbitrated
the dispute, and the arbitrator determined
that Hercules performed its work
in a timely manner, and awarded
Hercules monetary relief.
Harbert appealed, asserting that the
arbitrator manifestly disregarded the law.
The Circuit Court provided a quick review
of the facts and found “no evidence that
the arbitrator manifestly disregarded the
law.” Clearly angered by the appeal, the
court continued, stating, “the only manifest
disregard of the law evident in this
case is Harbert’s refusal to accept the law
of this circuit which narrowly circumscribes
judicial review of arbitration
awards.”

The court continued:
If we permit parties who lose in arbitration
to freely relitigate their cases
in court, arbitration will do nothing
to reduce congestion in the judicial
system; dispute resolution will be
slower instead of faster; and reaching
a final decision will cost more
instead of less. This case is a good
example of the poor loser problem
and it provides us with an opportunity
to discuss a potential solution.

The court, expressing its frustration at
so many frivolous arbitration appeals,
particularly those relying (without justification)
on manifest disregard of the law
as the basis of appeal, also issued a
reminder that it had previously provided
clear guidance to parties on whether
they would meet that standard. Harbert’s
case, the court explained, was “not within
shouting distance of the [manifest disregard]
exception.”
The “potential solution” would sanction
parties on the losing end of arbitration
who bring baseless litigation over
arbitration awards. Harbert was spared
sanctions in the case because “it did not
have the benefit of the notice and warning
this opinion provides.”
The court’s opinion follows the proarbitration
policy contained in the Federal
Arbitration Act (FAA). The opinion’s
threat of sanctions for baseless appeals is
also an explicit warning for “even the
least astute reader” to consider appeals
of arbitration decisions more carefully in
the future.
This opinion, on the other hand,
ought not to deter losing parties from
bringing a meritorious appeal.