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According to a federal district court in California, an aggrieved party can only challenge an arbitration award by invoking the applicable arbitration rules or through a motion to vacate, modify, or correct the award, and not through a related statutory claim after the award is issued.
In Nickoloff v. Wolpoff & Abramson, L.L.P., No. CV 07-3990ER, 2007 WL 2735289 (C.D. Cal. Sept. 18, 2007), Nickoloff alleged that Wolpoff and co-defendant Centurion violated the federal Fair Debt Collection Practices Act (FDCPA) and the California Fair Debt Collection Practices Act (Rosenthal Act) by filing an arbitration claim on debt that they allegedly had no legal right to collect. Specifically, Nickoloff maintained that the documentary evidence produced at arbitration was insufficient to prove the alleged debt, even though an award was entered against Nickoloff after a full hearing.
The Court quickly dismissed both claims for the same reason: Namely, that Nickoloff’s allegations were merely arguments about the sufficiency of evidence presented at arbitration, and the arbitrator’s findings of fact could only be challenged in court through a motion to vacate, modify or correct the award under the Federal Arbitration Act.
Also, as the Court noted, Nickoloff could have requested that the arbitration proceeding be reopened under Rule 43 of the National Arbitration Forum Code of Procedure, which was the applicable body of arbitration rules.
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