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A federal court in Louisiana refused to modify an arbitration award issued by the National Association of Securities Dealers (NASD) because, due to the lack of a reasoned opinion, nothing suggested that the panel had miscalculated damages.
In In re Wright, Civil Action No. 06-0356, 2007 WL 496865 (E.D. La. Feb. 13, 2007), Wright claimed that A.G. Edwards and Sons, Inc (A.G. Edwards) was responsible for his monetary losses. Wright prevailed in NASD arbitration proceedings, but moved to modify the panel's award, which allegedly miscalculated Wright's damages by $380,719.25.
The Court denied Plaintiff's motion to modify the award, finding "[t]he panel could have determined that the Plaintiff had not in fact suffered $530,719.25 in damages." While a reasoned award might have provided evidence of the alleged miscalculation, arbitrators are not required to provide reasons for their awards. In fact, so long as the award is "rationally inferable from the facts before the arbitrator, [the Court] must affirm the award." Valentine Sugars, Inc. v. Donau Corp., 981 F.2d 210, 214 (5th Cir. 1993).
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