There’s a lot to unpack in this article by Valerie Sanders of Eversheds Sutherland (available on Lexology), discussing the 11th Circuit’s opinion in Nuvasive, Inc. v. Absolute Medical, LLC.
NuVasive brought claims for breach of an exclusive distribution agreement, one of which–for breach of contract–was stayed by the court pending arbitration. After the arbitrators found breach but no damages, the judicial proceedings resumed, during which NuVasive discovered that an Absolute Medical arbitration witness who had testified remotely received real time text prompts from an Absolute Medical principal.
NuVasive successfully moved to vacate the arbitration award, for the reason that the award was procured by fraud. On appeal, the 11th Circuit affirmed the vacatur, not only on substantive grounds but also notwithstanding that the three month period to seek relief had expired. According to the court, the circumstances supported the narrow situation in which a court could equitably toll the limitations period.
While the granting of the extension of time in which to seek vacatur may be the important legal point decided by the 11th Circuit, perhaps the most important takeaway for attorneys and arbitrators in this era of Zoom arbitrations is the added importance of monitoring remotely testifying witnesses. While hopefully this case constitutes an outlier of witness and client misbehavior, it nonetheless serves as a reminder that permitting testimony outside the physical presence of the arbitrators calls for enhanced diligence.
positivelyneutral.com 