4th Circuit Affirms S.C. Order Mandating Arbitration of Welding Coverage Claims

RICHMOND, Va. — The Convention on the Recognition and Enforcement of Foreign Arbitral Awards preempts a South Carolina law excluding insurance claims from arbitration, the 4th Circuit U.S. Court of Appeals has ruled, adopting a narrow reading of the McCarran–Ferguson Act. ESAB Group v. Zurich Insurance PLC, Nos. 11-1243 and 11-1655 (4th Cir.).

On July 9, the appellate court ruled that a South Carolina federal court did not err in ordering arbitration of certain coverage claims brought against a foreign insurer. The McCarran-Ferguson Act applies only to domestic insurance contracts, not international contracts, the appellate court held.

ESAB Group is …