The parties in the Austin Trout-WBO case are awaiting a District Court Judge determination on whether an arbitration provision in the promotion’s agreement should stand.
An amicus brief was filed last month which advocates on behalf of the boxer that due to the one-sided drafting of the WBO’s Appeal Regulations, a clause that would save an arbitration provision would be unfair.
The drafter of the amicus brief is Law Professor Imre Stephen Szalai, a professor at Loyola University New Orleans. Professor Szalai’s bio says that he is a “nationally-known” scholar regarding the Federal Arbitration Act. He wrote a leading book about the enactment and the development of modern arbitration laws. Szalai, in his amicus brief, gives some context to the FAA regarding its history and policy regarding the law.
He notes that the WBO’s Arbitrator-Section Provision in Unconscionable. Notably, he highlights that the WBO had the “unilateral ability to appoint arbitrators, without any input from the boxer involved in the dispute.”
Professor Szalai also pointed to the winnowing of days in the WBO arbitration provision which would give boxers just 14 days to file a claim in arbitration. Here, Szalai points out that the Muhammad Ali Boxing Reform Act (“Ali Act”) has a four-year statue of limitations. This “frustrates the ability of a boxer to effectively vindicate his or her rights.” An issue that arose during this dispute was where the Ali Act could be subject to arbitration rather than litigated in court. While that issue has yet to be addressed head-on, Professor Szalai notes that closing the window on these appeal rights provides the inference that this was done in ‘bad faith.’
He then argues that the text of the FAA does not allow for severance of bad faith terms and as a result the obligation to arbitrate must be invalidated. The reason being is that since the arbitration provision was motivated by bad faith (as evidenced by the unilateral pick of arbitrator and shortening the time to appeal a dispute), the drafter of the language should not be rewarded by granting them the chance for an arbitration.
An expert in the FAA, Professor Szalai identifies the sections of the act which does not permit severance of unconscionable terms. He writes “[s]imply put, as a matter of federal law, an agreement is fully enforceable, or not enforceable at all.”
The professor also addresses the notion that the FAA contains a clause for the judicial appointment of arbitrators as inferred by the WBO. He clarifies this by identifying the narrow causes for judicial appointment, none of which occur in this case.
Payout Perspective:
An amicus brief is merely a brief filed by a third-party that usually advocates for a particular position. Here, the professor, an expert of the FAA, is providing some context for the Court as it decides the issue of arbitration. Since he’s not a party, he had to obtain permission from the Court to file and have it considered. The WBO, in its briefing, also addressed the professor’s arguments. While instructive it does not have to be considered with any greater weight than any of the other briefing. Also, it does not even have to be considered in rendering an opinion. MPO will continue to follow.
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