United States District Court, S.D. Florida
UBS FINANCIAL SERVICES INC. and UBS CREDIT CORP., Plaintiffs,
HOWARD WALZER, Defendant.
ORDER CONFIRMING ARBITRATION AWARD
L. ROSENBERG UNITED STATES DISTRICT JUDGE
matter comes before the Court on Plaintiffs UBS Financial
Services Inc. and UBS Credit Corp.'s (together,
“UBS”) Petition to Confirm Arbitration Award. DE
1. Defendant Howard Walzer filed a Response in opposition,
which incorporates by reference a Petition to Vacate filed
pro se by Defendant in state court. DE 10. The Court
has carefully reviewed Plaintiffs' Petition,
Defendant's Response, and is fully advised in the
premises. For the reasons set forth below, Plaintiffs'
Petition is GRANTED.
was formerly employed by UBS as a financial advisor, and
during his employment he received seven loans from UBS
totaling $1, 267, 999.00, executing a promissory note in
connection with each loan. DE 1 ¶ 8. Defendant resigned
on December 18, 2015, and pursuant to the terms of the notes,
his resignation caused the unpaid balances of the loans to
become immediately due. DE 1 ¶¶ 9-10. Defendant
failed to pay the balance due under the notes, and on March
25, 2016, Plaintiffs initiated an arbitration pursuant to the
notes' express arbitration provision under the rules of
the Financial Industry Regulatory Authority
(“FINRA”). DE 1 ¶¶ 11- 13.
sought and obtained four postponements of the arbitration
hearing. DE 1-1 at 3. On February 22, 2019, Defendant
requested a fifth postponement of the hearing, which at that
point had been scheduled for March 5, 2019. Id. at
3-4. The basis for the request was that Defendant suffered
from a medical condition which made him unable to focus or
remain in a sitting position, and Defendant submitted a
letter from his neurologist indicating such. Id.; DE
10-1 at 19. The arbitration panel denied this request but
asked that Plaintiffs and FINRA permit Defendant to appear by
videoconference, with his counsel physically present. DE 1-1
at 4. This accommodation was permitted. Id. On March
1, 2019, one business day before the hearing, Defendant
submitted another postponement request, including additional
evidence of Defendant's medical treatment and side
effects caused by Defendant's medication. Id.
The panel did not consider this postponement request because
of its proximity in time to the hearing. Id.
date of the hearing, both Defendant and Defendant's
counsel appeared by videoconference, but due to technical
issues, the panel requested that Defendant's counsel
appear in person as previously contemplated. Id.
Defendant's counsel arrived two and a half hours after
the scheduled start of the hearing. Id. He renewed
his argument that the hearing should be postponed because of
his client's inability to participate in the proceedings.
Id. The panel then reviewed the previously submitted
medical records, which the panel concluded were incomplete in
various respects. Id. After taking evidence and
testimony from both sides, the panel determined that
Defendant had not adequately demonstrated this his medical
condition prevented him from participating in the
proceedings. Id. The arbitration continued, with
Defendant observing by videoconference with intermittent
technical issues, such as the video feed freezing and the
audio cutting in and out. DE 10-1 at 4 ¶ 23.
March 26, 2019, the panel issued an award in favor of
Plaintiffs, granting $791, 265.94 in compensatory damages for
the loan balances, $43, 566.66 in pre-judgment interest, $57,
084.88 in attorney's fees and costs, and $37.15 per diem
in post-judgment interest (“the Award”). DE 1-1
at 13. Plaintiffs now seek confirmation of the Award under
the Federal Arbitration Act. 9 U.S.C. § 9. Defendant
argues that the Award should be vacated under the Florida
Arbitration Code, alleging: (1) the arbitrators failed to
postpone the hearing upon a showing of sufficient cause, in
violation of Fla. Stat. § 682.13(1)(c); and (2) the
arbitrators exceeded their authority in violation of Fla
Stat. § 682.13(1)(d).
federal court's review of an arbitration award is highly
deferential and extremely limited.” United Steel,
Paper & Forestry, Rubber, Mfg., Energy, Allied Indus.
& Serv. Workers Int'l Union AFL-CIO-CLC v. Wise
Alloys, LLC, 807 F.3d 1258, 1271 (11th Cir. 2015). The
court should presume that the arbitration award will be
confirmed and should defer to the arbitrator's resolution
of the dispute whenever possible. Lifecare Int'l,
Inc. v. CD Medical, Inc., 68 F.3d 429, 433 (11th Cir.
1995). An arbitration award can be set aside only in narrow
circumstances. First Options of Chi., Inc. v.
Kaplan, 514 U.S. 938, 943 (1995). The party requesting
that the arbitration award be vacated has the burden to prove
a basis for vacatur. Riccard v. Prudential Ins. Co.,
307 F.3d 1277, 1289 (11th Cir. 2002). In the absence of such
a basis, “the court must grant” an order
confirming the award. 9 U.S.C. § 9.
arbitration agreement involves interstate commerce, the
Federal Arbitration Act (“FAA”) governs,
supplemented by the Florida Arbitration Code
(“FAC”) to the extent that the FAC does not
conflict with the FAA. 9 U.S.C. §§ 1-2; see
Kong v. Allied Prof'l Ins. Co., 750 F.3d 1295, 1303
(11th Cir. 2014) (explaining that the FAA applies to all
contracts involving interstate commerce); Belz v. Morgan
Stanley Smith Barney, LLC, No. 3:13-cv-636, 2014 WL
897048, *5 (M.D. Fla. Mar. 5, 2014) (stating that “the
law is settled that in a case . . . involving interstate
commerce, the FAC applies only to the extent that it is not
in conflict with the FAA”); see also Commercial
Interiors Corp. of Boca Raton v. Pinkerton & Laws,
Inc., 19 So.3d 1062, 1064 n.2 (Fla. 5th Dist. Ct. App.
2009) (noting that the grounds to vacate an arbitration award
under the FAA and the FAC “are essentially the
seek confirmation of the Award under the FAA, and Defendant
argues that the award should be vacated under Fla. Stat.
§ 682.13. When the underlying agreement between the
parties is one involving interstate commerce, the FAA
supersedes state regulation of arbitration agreements.
Kong, 750 F.3d at 1303 (“[I]f a contract
involves interstate commerce, a court must resolve
arbitration disputes according to the FAA . . . .”).
Although Defendant has couched his objection to the Award in
terms of Florida law, he has not argued that the parties'
agreement to arbitrate contained within the promissory notes
are exempt from the FAA. The Court concludes that the FAA
applies because the promissory notes between the parties
involve interstate commerce. Plaintiffs are Delaware
corporations, UBS Financial Services Inc. has its principal
place of business in Delaware, and UBS Credit Corp. is one of
its affiliates. DE 1 at 1-2 ¶¶ 2-3. Defendant is a
Florida citizen. Id. at 2 ¶ 3. Because notes
evidencing roughly $1.3 million in loans between diverse
parties affect interstate commerce, the notes are contracts
involving commerce and therefore the FAA applies. See
Allied-Bruce Terminix v. Cos. v. Dobson, 513 U.S. 265,
277 (1995) (“[W]e conclude that the word
‘involving,' like ‘affecting,' signals an
intent to exercise Congress' commerce power to the
full.”). Accordingly, the Court construes
Defendant's objections to the arbitration award under the
FAA's substantially identical provisions to the Florida
statutes he cites: 9 U.S.C. §§ 10(a)(3) and
The arbitrators were not guilty of misconduct in refusing to
postpone the hearing
(a)(3) permits courts to vacate an arbitration award
“where the arbitrators were guilty of misconduct in
refusing to postpone the hearing, upon sufficient cause
shown, or in refusing to hear evidence pertinent and material
to the controversy; or of any other misbehavior by which the
rights of any party have been prejudiced.” 9 U.S.C.
§ 10(a)(3); see also Fla. Stat. §
682.13(1)(c) (providing for vacatur when the
“arbitrator refused to postpone the hearing upon
showing of sufficient cause for postponement”).
Defendant argues that he demonstrated sufficient cause to
postpone the hearing because: (1) he provided a note from his
neurologist describing his medical condition; (2) the