The Seventh Circuit recently decided an important case concerning what happens when Party A asks its party-appointed arbitrator to resign, the agreement is silent on how the vacancy should be filled, the remaining two arbitrators devise and implement a procedure for appointing a replacement, Party B (whose arbitrator did not resign) reserves its right to challenge the replacement procedure, and the Panel ultimately renders an award in favor of Party A. The Court held that the Panel did not exceed its powers by adopting and implementing — in the face of the agreement’s silence, and in the absence of Party B seeking court intervention under Federal Arbitration Act Section 5 – a procedure that allowed Party A to replace its party-appointed arbitrator and continue with the arbitration. See WellPoint, Inc. v. John Hancock Life Ins. Co., ___ F.3d ___, slip op. (7th Cir. August 7, 2009) (Slip op. here). Continue Reading »