Plaintiff sued in state court, alleging that he and his company were “blacklisted” from doing business on the Commodities Futures Exchange due to e-mails circulated by the defendant, which is a large clearing firm on the New York Mercantile Exchange (“NYMEX”). After the case was removed, it was stayed pending arbitration before the NYMEX. Plaintiff then filed an arbitration demand before the National Futures Association, contending that arbitration before the NYMEX could not be impartial due to the defendant’s “considerable power and influence” within NYMEX. The district court found that potential bias did not rise to the standard of the fraud, duress or unconscionability required to disregard an arbitration agreement. The court directed plaintiff to withdraw the arbitration demand to the National Futures Association and proceed, if at all, before the NYMEX. Carboni v. Lake, Case No. 06-15488 (USDC S.D.N.Y. June 20, 2008).
This post written by Rollie Goss.