Armstrong Seeks To Vacate Arbitration Award

When cyclist Lance Armstrong finally confessed doping to Oprah Winfrey in 2013, the Dallas sports insurance company that paid him millions of dollars in victory bonuses sued for fraud, asking for its money back. After SCA accused Armstrong and filed suit which was sent to arbitration, Armstrong unsuccessfully tried for an appeal with the Texas Supreme Court to have the case blocked. The dispute with Armstrong actually began over a decade ago, after the former U.S. Postal Service team member won the 2004 Tour de France, the sixth of his seven consecutive victories. Following doping allegations, that case went to arbitration in 2005. SCA Promotions paid Armstrong $7.5 million in 2006. Evidence from that arbitration was used later against him, including testimony from a former teammate and his wife, who said they heard Armstrong admit to using performance-enhancing drugs back in 1996. Armstrong was banned for life by the United States Anti-Doping Agency and stripped of his Tour titles in August 2012. Last February, SCA won a $10 million ruling against him after this case went back to the same arbitration panel that handled the 2005 dispute. The panel said Armstrong used perjury and other wrongful conduct to secure millions of dollars of benefits from SCA. One of the three neutral panelists dissented, noting that the parties entered into a final and binding settlement agreement the last time around. The dissenter apparently believes the majority's sanction is an unwarranted, unlawful reversal of a prior settlement agreement already made and effectuated. Armstrong's attorneys reportedly say the arbitration panel exceeded its authority with its recent ruling. According to news reports, Armstrong's attorneys claim the panel's issuance of sanctions violates well-established Texas public policy favoring settlements and arbitrations for efficient and final resolution of disputes. Court documents show Armstrong and Tailwind Sports, which owned the U.S. Postal Service team for which Armstrong raced, are seeking to vacate the award, insisting it “effectively eviscerated a fully negotiated and binding settlement agreement” reached between Armstrong and SCA Promotions in 2006. The arbitrators have said, “Perjury must never be profitable.” SCA Promotions is now asking a Texas state judge to confirm the arbitration award against Armstrong. It wants the court to enter a $10 million judgment against Armstrong and the former team owner so it may proceed to collect payment. Armstrong’s lawyers maintain the dispute settled voluntarily and finally years earlier. Interestingly, Armstrong previously offered to pay SCA despite the absence of any legal basis for the sanction, and SCA refused to accept. Armstrong is also facing a $100 million fraud lawsuit from the federal government. See full stories here-- http://bit.ly/1F4qXrH and http://usat.ly/1Kqgxm2 and link to motion to vacate pleading here-- https://www.scribd.com/doc/264558280/Lance-Armstrong-Does-Not-Want-to-Pay-SCA-10-Million

Bogus Arbitrator Credentials Call Awards Into Question

Some forty Wall Street securities arbitration cases dating back more than fifteen years may be compromised because an arbitrator allegedly lied about being a lawyer. FINRA, the Financial Industry Regulatory Authority that runs a mandatory arbitration forum where brokerages and investors resolve their disputes, removed the arbitrator who said he was a lawyer and a member of the bar in several states, when he was not. The former FINRA panelist claimed he was a "lawyer" (putting the word in quotes himself), but admits he was never licensed in Florida or New York, though he maintains California's bar must have lost his records. FINRA has reportedly been trying to improve perceptions of fairness to investors in its arbitration system. It also recently bolstered measures to police its arbitrators. Nonetheless, this news is likely to be more ammunition for mandatory arbitration clause critics. This revelation raises questions about whether the parties might attempt to overturn those decisions. It is unclear whether an arbitrator's fraudulent misrepresentations could give rise to new hearings. Apparently, a lawyer by the same name has informed the state bar association and the California attorney general's office about the matter, in the event the arbitrator appropriated a background other than his own. See story here-- http://reut.rs/1jAuv9S