Two recent suits reported in the September 5 issue of Mealey’s Litigation Report:  Reinsurance involve plaintiffs asking the courts to confirm arbitration awards.  The plaintiffs in these cases are playing their cards close to their chests by invoking confidentially agreements or by requesting that the courts seal the awards.

Back in the June 20, 2008, issue of Mealey’s Litigation Report:  Reinsurance, Lewis E. Hassett and Cindy Chang of Morris, Manning & Martin, LLP, discussed the issue of public access vs. arbitration confidentiality in a commentary titled “Public Access v. Arbitration Confidentiality:  A Balancing Act That Tilts Towards Access.”

This excerpt from their commentary gives a general overview of this balancing act:

“Requests to a court to respect confidentiality agreements and orders arising from arbitrations implicates two competing public policy interests — encouragement of arbitration versus public access to judicial records. On one hand, pursuant to the Federal Arbitration Act (“FAA”), 9 U.S.C. § 2, and analogous state statutes, public policy strongly favors respect for valid agreements to arbitrate. See, e.g., Preston v. Ferrer, 128 S. Ct. 978, 981 (2008); Southland Corp. v. Keating, 465 1, 10 (1984); Friend v. Friend, 609 A.2d 1137, 1139 (D.C. 1992). The goal of encouraging arbitration logically would include preserving the underlying benefits of the process, including confidentiality. Fireman’s Fund Ins. Co. v. Cunningham Lindsey Claims Mgmt., Inc., No. 03CV0531, 2005 U.S. Dist. LEXIS 32116 at *10-11 (E.D.N.Y. June 28, 2005). However, a countervailing interest is the common law presumption favoring public access to judicial records. See Nixon, 435 at 597; Lederman, 897 A.2d at 371 (“[T]hough arbitration has the worthy goal of reducing the number of cases filed in court . . . open access to our courts is the bedrock of public confidence in the judicial system.”).”

Confidential arbitrations offer unique challenges to me as a journalist, but sometimes the facts of the actual arbitrated dispute are not as interesting as the process in the courts to keep the facts confidential.

The latest issue of Mealey’s Litigation Report:  Reinsurance also includes three asbestos reinsurance suits; a case where a federal judge in Florida held that the arbitration provision in a reinsurance agreement is broad enough to cover a dispute arising out of four related placement slips; a judgment holding that the signatories of a number of guaranties of a reinsurer’s obligations are obligated to abide by their written agreements in spite of allegations that they were told verbally that the agreements would never be enforced; a denial of a motion to dismiss and/or stay pending a related arbitration with the judge holding that the arbitration would not answer the pertinent questions of the case; a contract dispute over whether a startup fee could be counted as an incurred loss when calculating commissions to be paid to a claims administrator; and more.