Court Erred in Appointing 5-Member Arbitration Panel, 5th Cir. Rules

NEW ORLEANS - A Texas federal court erred in deviating from an arbitration agreement that called for a three-member arbitration panel by ordering the parties to proceed before five arbitrators, the 5th Circuit U.S. Court of Appeals has ruled. BP Exploration Libya Ltd. v. ExxonMobil Libya Ltd., et al., No. 11-20547 (5th Cir.).

On July 30, the appellate court ruled that while the district court was authorized to exercise appointment power under the Federal Arbitration Act, it violated § 5 of the act by ignoring the parties’ express agreement to arbitrate before a three-member panel.

In exercising its appointment authority …