SUPREME COURT DENIES CERTIORARI IN CASE ADDRESSING THE RELATIONSHIP BETWEEN THE MCCARRAN-FERGUSON ACT AND THE NEW YORK CONVENTION

The United States Supreme Court denied certiorari in the Louisiana Safety Association case on October 5, 2010, leaving standing the en banc Fifth Circuit opinion described in our November 16, 2009 post. The issue was whether the laws of individual states that restrict or prevent the enforcement of an arbitration agreement in insurance agreements prevent the enforcement of such arbitration agreements that are subject to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (“the New York Convention”), because the New York Convention is “an Act of Congress” preempted by the McCarran-Ferguson Act. The Fifth Circuit answered the issue in the negative, finding that the New York Convention prevailed over state laws. The Court requested that the Solicitor General submit an amicus brief addressing whether certiorari should be granted. The government submitted an amicus brief which took the position that the opinion below was correct, and that the Supreme Court should deny certiorari. A conflict remains as to this issue with the Second Circuit’s decision in Stephens v. American International Ins. Co., 66 F.3d 41 (2nd Cir. 1995), although the government’s amicus brief took the position that there was an inter-panel conflict on the issue in the Second Circuit, rendering any conflict immature. La. Safety Assn. v. Certain Underwriters, et al., No. 09-945 (US Oct. 4, 2010) (see page 10).