We have written extensively on Stolt-Nielsen, S.A. v. AnimalFeeds Int’l Corp., No. 08-1198, a case pending before the United States Supreme Court in which a decision is expected in the not too distant future. Stolt-Nielsen presents the question whether a court or arbitration panel may, consistent with the Federal Arbitration Act, impose class arbitration on a party whose arbitration agreements are silent on that subject. The answer to that question will likely answer a related question that is of special concern to those involved in reinsurance arbitration: Can a panel or court impose consolidated arbitration on a party whose arbitration agreements are silent on that subject? You can read our prior posts on Stolt-Nielsen here, here, here, here, here, here, here, here, here, here, here, here, here and here. (Certain of these posts contain links to articles on Stolt-Nielsen we wrote for Karl Bayer’s Disputing blog.)
But those posts principally concern the legal issues raised by the case, discuss various ways it might be decided, and argue that the correct answer to the question is that a court or arbitration panel cannot, consistent with the Federal Arbitration Act, impose class or consolidated arbitration in the face of silence. To date we have not discussed in any detail the practical implications that the case may have on reinsurance arbitration, if any. So today let’s look at what those implications may be. Continue Reading »
