Legal Case Summary

Oral Audio Transcript(Beta version)

. All right, and then your side had equal relations with some of the lawyers involved in the case. I mean, it was just... How do you get out of... You know, call practices, so in bread now, with everybody's musical chairs going from one firm to the other. How do you find somebody that's pristine, pure? And I don't know that that's a requirement, Your Honor. That's basically what you're saying. The name of the game is you lose the arbitration, then you look. I'm sorry, Your Honor? You lose the arbitration, then you start looking for all these conflicts. That's the way I read some of this happening. When you start talking about somebody, whether they had an extensive conflict, they were partying law together for 20 years. Like you didn't know that? I mean, you were going to a wedding or a party and had some side of social contact. Baker Bonson, not exactly a small little law firm. They got the case before the Supreme Court, now seeking an additional few million more to top of a sick... It's a big operation. I mean, you know, that's what troubles me about that. I don't mean... I'm never... I represent your client, but it just... I have a hard time saying what that adds up to. Your Honor, first of all, it starts with non-disclosure. We got nothing. We got nothing

. So basically... No, no, no, no, no. I mean, you have got something. She does tell you. You know she's practiced for Baker Bonson. You know she's practiced a long time. And you know that Mr. Shipper has been there for a long time. So I mean, there are a lot of assumptions that you can truly make... That a reasonable person can make them. Are you talking about the disclosure requirement itself that... If that's common knowledge, there's no needs of disclosure, no? Well, more or less. I mean, if it's... I mean, not common knowledge. It's not... But I mean, if you know someone has been practicing law with someone else for 20 years... And you knew that. You had to know that, right? I personally did not know that. Well, I mean, you... Well, I mean, just a little

... A minimal kind of research or not even research, but just common knowledge. If you know both how I've been with Baker Bonson. Well, you have an arbitrator. You don't look... You know, you get an arbitrator. You look down there. You don't look them up and say, well, what the background is? You're going to be arguing for these people. You're on it. I can't tell you what... Obviously everybody does, but I do think that... What are you doing? You just put the first six out of you in the box, and we will try this case right here. You don't do that. You're on it. I mean, we first of all, we looked at the disclosure. And we rely upon the disclosure of the arbitrator herself. And at that point, then the question becomes, how far... What did she disclose? What did she disclose? Nothing. Did she have a curriculum v-tie attached or anything like that? No, ma'am. Did she disclose that she had practiced law with Baker Bonson? Did she name close that? No, you're on it. She just... Nobody knew Diana Marshall. I'm shocked

. Nobody knew Diana Marshall where she came from. Well, I'm not saying that. I'm saying to she... What do I mean to say? Well, I mean... She's a well-known figure in Houston. Everybody knows who she is, where she's been. And... Knowledge of someone's status, Ron, or I don't think it quakes the knowledge of the details of relationships that she may have on an ongoing... How many large and hestand are qualified arbitrators? And if he say they work together a big firm and they socialized? And I'm not saying that that disqualifies the arbitrator. All I'm saying is, first, it starts with disclosure. So everybody that you have to say, well, I was with three big firms and I... And then ask, am I currently... That's a huge disclosure obligation. Well, how many weddings did I go to? How many parties did I go to? How many lunchances did I have with so-and-so? And the arbitrator is a person who has exclusive knowledge of that information, your honor. And the point of the disclosure... Well, your argument sounds very close to just my saying that the end of this disclosure is self-proviscerated to the Harvard Award, non-disclosure. Even though the lawyers knew the information, if they'd breached their obligation to disclose it, is that true? I'll say to you another way, does the circumstance that you... This is common knowledge and you knew it? It self-answered solve a problem or not? You ought to understand that

. In other words, you said it aside, you knew about it? Under Texas Law, your honor, which is different. Well, yes or no about that. You tell me why, but in your theory, is that enough? Under the current state of Texas Law, yes or no, that would be said. So it comes down to that. It's an undisclosure. And so maybe that's one reason you don't want to check them out. You're going to take the opportunity. You know they're okay, but I don't want to do much searching because I can... I'll leave a searching if I lose. Well, that raises another question. How far do you search before you find this missing pearl to information? Where your arbitrator practices law? I mean, I really found it incredulous that you would try a large arbitration case before three arbitrators, that you don't know anything about it. I participate in arbitration, most of the lawyers, I even 40 years ago when I was in pro-practice. Let me tell you, I knew two of the arbitrators very, very well. And the third one they picked, I did everything in the world to find out about them because that was going to be the deciding. And I thought I would have been getting them out of practice if I didn't know where they practiced, what they did, and what they're written, and thought about the best I could find out. If I'm missing something here, I'm just trying to understand the argument. I believe the argument in your honor is in a wholesale failure to disclose anything whatsoever. The question is how much of that then shifts to the non-disclosing party to go and fair it out the information. Because admittedly some information... What do you have other than the Baker bot? I'm sorry? What do you have other than the Baker bot's connection? Well, the Baker bot starts the connection, and then we have personal connections between almost every lawyer and the law firm representing the other side, and the sole law partner of Miss Marshall, that was not disclosed. We have a dinner party together between the spouses and the lawyer and her partner. We have a golf outing, we have a wedding, and a possibly a wedding that was attended... This is not with her. This is with their law partner. With their law partner. That's right. Who you're for you, Mr. Benton, had even greater association with

. I don't know... That's what the breaches indicate. And that's what the breaches say, but I don't know personally, your honor, whether or not that's true. Well, you're unchallenged it. I'm seeing you in a reply, a breaches say it's a bunch of lies. I'm just going off the record before the court, your honor, before the district court. I'm not trying to introduce additional evidence because we were as part of our complaint, is that we were limited in our ability to... Tell me why social contacts between an arbitrator's law partner and a party's lawyer leads the evident partiality, first off as between the lawyer and the law partner, and then second step between the arbitrator. Where does that give rise to evident partiality? On under Texas law, the view is that it's an objective observer test. That's the... And an objective observer would think that because Diana Marshall's law partner, Lewis, was... I'm sorry, law... Shipley was friends with Mr. Lewis and had a social relationship that that would mean she would favor Mr. Lewis. Well, and again, it's in terms of might. The Texas Supreme Court has said that a evident partiality under the Texas Arbitration Act, if the arbitrator does not disclose information which might... Might, but go on and continue to what? To an objective observer? That's where I'm saying that what objective observer would say that. Is that a legal question or is that a fact question? What if this case were in Tyler? What if this case were in Tyler, not Houston, or Bay City? Again, full disclosure. We're not arguing whether it actually disqualifies them to serve as an object. What I'm asking about the test, what someone reasonably think, because there are relationships between these people that that might cause them to be partial. I don't know if it's a geographic test

. Well, I'm looking to realities. I understand. I would say that, you know, I don't know. I honestly don't know if it's in Tyler. It's different than say in Houston or Austin. I just know that that is the test of Supreme Court is set forth that we are here struggling with. Why, as you know, I did not agree with the test and Tom Phillips who wrote the opinion of the sense of disavowed it, at least privately, but in any bid it is the law. Yes, Your Honor. And again, it's not, and it not only just might, but it's a reasonable impression of the arbitrator's partiality. And I think that the Texas Supreme Court is viewing, they want full disclosure. They have yet to find a case of waiver. They have yet to excuse any non-disclosure that has reached them. Should we certify this case? I think if you did, Your Honor, they'd come back and say see the tenaska opinion that came out in May of this year. But, and I think it's been answered. I really do. What, I mean, from your point of view, what does tenaska hold? And in two sentences. That a party does not waive an evident partiality challenge by having some knowledge of the existence of relationship, but not the substance or details. Okay. So, I think that we have a question. I think that we have a question. I think that we have a question. I think that we have a question. I think that we have a question. I think that we have a question. I think that we have a question. I think that we have a question. I think that we have a question. I think that we have a question. I think that we have a question. I think that we have a question. I think that we have a question. I think that we have a question. You know, it's all true here. That would be the next, that would actually be the question

. Is it trivial or not? That's a question, because what I've got to decide? Objection. I mean, if we decide the objection is immaterial or correct. And your honor, the district court originally vacated the award because that the connection was not trivial. Then, the district court vacated the vacator. But the balance line's not trivial. Because again, the collectivity of the information that was not disclosed. You mentioned a minute ago that about a pearl, how did I know there's a pearl in here? So where is the pearl here that you referred to? I mean, miss, about 30 or none disclosed. It's the collection of information that was not disclosed. Well, there are pearls, not a pearl. Collectively, yes, you're right. Collectively. The district court did not reach the triviality issue on the second go round because she found waiver based on the tenasca case that came out of the Dallas Court of Appeals that then was subsequently reversed by the Texas Supreme Court. What are you saying that we would have to remain for her to make that decision? Or is it just simply a matter of law? We could just simply say that this is not a amount to evident partiality. You're on our belief that the evidence that is already in the record supports that it is evidently partial and it's not trivial. But if this court believes otherwise, it could, excuse me, it could reverse and render based on that. If it believes that there's a question of triviality, it would have to reverse and remain and we would have to be allowed discovery to then develop the record for the district court. Yeah. You set up this question, interesting, the last step to hide from the arbitrators, the effect of their decision. How did that work? I thought there was a, the arbitrator's turn, what the legal questions the arbitrator would settle would be and what the dollar consequence of the answer would be. If question one is yes, one part is a one of the million, if question one and two, no, one part is a one and seven million. Does that mean that the arbitrators did not know which party would prevail, but then on the answers? I suppose they could have figured it out because obviously at the hearing, the parties were arguing very specifically for certain answers. We were arguing for, I believe we were arguing for no and they were arguing for no. Why would you set it up that way unless it was to create a blonde system so that the arbitrators would be determining that abstract question without knowing the particular outcome of it? I think we would be. Why is it that relevant to whether the inquiry is to objective observer? Is it, I mean, I don't, maybe if they're in there trying for you, they're going to have to figure out what it is. Maybe that, maybe you could say that's evident. If it's yes or no, one, but I think at the hearing, your answer is very clear. It's true then why did you do it that way? I think we were trying to get the most objective, unbiased panel that we could. I do and I don't think it works. I think we tried. Okay, thank you very much. You certainly saved time for a battle misunderstandess. Miss Maddox? May I please the court, Amy Douthett Maddox for Federal Insurance Company who is the sealed Apple E in this case. Based on opposing counsel's argument and the court's questions, I plan to concentrate my argument on evident partiality and waiver by managing my time well also, probably touch on the issue of discovery and that goes along with the issue of remand that Judge Jolly brought up. I don't plan to address subject matter jurisdiction or the exceeding authority manifesto, cigar, et cetera, unless the court has any particular questions on those

. There is not a single case that supports vacating an arbitration award on facts that are so tenuous and so remote and time as they are in this one. There is also not a single case that holds that a party or a party's attorney can have actual knowledge of the very facts that they later argue constitute evident partiality but keep those facts or that knowledge in their back pocket until they find out whether they've won or lost the arbitration and then argue, well, there was no disclosure so it doesn't matter what we knew, there's evident partiality simply from the fact that there was no disclosure at all. This case is governed. I don't think there's much dispute about the law. Are there any record development of whether there was actual knowledge of these relates of the fact of the law firm connections? Yes, there was. There was an evidence you're hearing held before the district court. Several people testified. The court also took stated with agreement of the parties that the affidavits that were submitted in connection with federal's motion for reconsideration would also be part of the record. And then great Americans, lawyers were able to cross examine all the Shipley-Snell Montgomery attorneys that were there. And Mr. Shipley called Mr. Andes and Mr. Benton to the stand. There was evidence for Mr. Shipley. There was evidence for Miss Schnell. There was evidence for Mr. Benton that they had actual knowledge that George Shipley was at Baker-Bots, that Miss Marshall's partner, Mr. Lewis, was at Baker-Bots. There was also evidence that when Miss Marshall was designated, which was done by letter, there was a link to her website. Mr. Shipley sent the letter to Mr. Andes. There's a link to her website. And merely clicking on her website and clicking on Diana Marshall shows that she was at Baker-Bots for a number of years. And in fact, going to Judge Owens' question, her CV was on there, her resume was on there as well. And the district court made fact findings. And to some extent, I think that's where Tanasca comes in. The district court made fact findings. Four places, the district court said they had actual knowledge, including of Miss Marshall, because the evidence that was presented at the hearing was before Miss Marshall was designated, federal designated Murray Folgler of Becker-Eddon. As a Texas court, in Texas law developed the impact of the actual knowledge that it translate only into a waiver or how does that handle in the Texas law? Well, the three cases are basically a trilogy of cases, two-go, Mariner Financial and Tanasca. The concurrence in Mariner Financial discusses a little bit where should certain knowledge go. All of those cases, those say, two-go says, in footnote nine, a party who knows of a conflict before an arbitrator issues an opinion must promptly object to avoid waiver. In each of those subsequent cases, did they find waiver? No

. Mariner Financial discusses all the waiver cases, even including from other jurisdictions, and says notes that those cases hold that there's waiver when there's an undisclosed relationship is either well-known or easily discoverable. But Mariner Financial was a summary judgment case, and the court howled that there was no summary judgment evidence that they could have discovered anything had they tried, and so that case was remanded. Tanasca is a case that, again, the court howled that there was no waiver in that case. In that case, again, based on the trial court's fact findings in that case, the arbitrator had made some disclosures, and one of the disclosures he made is that he was affiliated, he was a director of this legal outsourcing company, and that he'd had a meeting with the law firm that was representing one of the parties in the arbitrator, a large law firm, 750 members or something like this. But that wasn't clear that there'd be ever been any business. The facts that came out there were that not only did he have a much greater role in this legal outsourcing company, but he had contact, not just with the law firm, but with those two members that were before him, ongoing contact, where he was trying to solicit business on behalf of this company from the very people who were appearing before him. And so obviously, the Supreme Court said, well, that's a situation where a reasonable observer can look at that and say, well, he might be more likely to favor this side because he's trying to get their business right now. If you contrast that with our facts, what we have here is everybody knew that all these people worked at Baker Botts together. Miss Marshall worked at Baker Botts some 16, 17 years ago. I don't think we know what month she left, so we can't come somewhere in there. 16, 17 years ago, almost two decades ago. Her partner, who was not the arbitrator in this case and had nothing to do the arbitration in this case, and there's no allegation that he did, was there some five years before the arbitration. And they were able to examine anybody they wanted to at this evidentiary hearing. Let me have one question about. An earlier third arbitrator was dismissed for what reason? He wasn't really dismissed what happened is federal appointed him. And this actually, the evidence, the point? Our side, federal insurance company, appointed Mr. Fogler as our arbitrator. And he's with Beck Redden, and he made some minimal disclosures. And then what happened is they went and fished around on the Beck Redden website. And they found out that Beck Redden had represented Memorial Herman and some other stuff, Memorial Herman, was an insured, etc., etc. They came back to us and had some questions and we said they were research. They did their research. And nobody ever objected to him is how it came about. It just seemed like they weren't ever going to agree. So we said, never mind, we're going to nominate. I'm not going to give you a built-in error. Yes, so we nominated Marshall instead. And that was the basis for the district court's finding. She found that... I didn't mean to. Stracture from your... She found that they knew about Marshall as well. Because she found it inconceivable, particularly based on the investigation they did of folklore that they didn't at least click on the website and look. So everybody knew that all these people were at backer bots many years before the arbitration. Everybody knew that. So... They want to make more. They say that there is a collection of contacts. But the evidence came out. And the evidence was as to Miss Marshall. Even when they were at backer bots, they never worked together. The only time that George Shipley could remember anything was that she apparently participated in the in-house need of program when he was a second or third year associate and he was required to go to that. He's... Oh, 17 years ago. This would gosh, this would be more than 17 years ago. That's when she left. This is when he's a young associate. He has run into her a couple times or may just be once. And an American college of trial lawyers luncheon that had some 200 people in there. Clearly, he knew her to say hi because they used to work at backer bots together. This is the evidence that came out. As to Mr. Lewis, who again was not the arbitrator in this case, the evidence was that again, there was really very... Mr. Shipley never worked with Mr. Lewis. Miss Nell, who was the other

... She found that they knew about Marshall as well. Because she found it inconceivable, particularly based on the investigation they did of folklore that they didn't at least click on the website and look. So everybody knew that all these people were at backer bots many years before the arbitration. Everybody knew that. So... They want to make more. They say that there is a collection of contacts. But the evidence came out. And the evidence was as to Miss Marshall. Even when they were at backer bots, they never worked together. The only time that George Shipley could remember anything was that she apparently participated in the in-house need of program when he was a second or third year associate and he was required to go to that. He's... Oh, 17 years ago. This would gosh, this would be more than 17 years ago. That's when she left. This is when he's a young associate. He has run into her a couple times or may just be once. And an American college of trial lawyers luncheon that had some 200 people in there. Clearly, he knew her to say hi because they used to work at backer bots together. This is the evidence that came out. As to Mr. Lewis, who again was not the arbitrator in this case, the evidence was that again, there was really very... Mr. Shipley never worked with Mr. Lewis. Miss Nell, who was the other... There were three attorneys that Shipley Snow who worked on the arbitration. Mr. Shipley, Mr. Snow and Miss Miller. Miss Miller never worked at backer bots, so that has never been an issue. Miss Nell remembers that she did, as a young associate, one research project for Mr. Lewis. You can't remember what was about or anything about it. But she thinks she did a research project when she was young. Then... Oh, go ahead. In this case, whether... Terule, in your favor, do we make any law? No. Terule, in their favor, do we make any law in this case? Is it just really, as far as legal issues, or as far as worthy of publication, is essentially a wash? Well, I think the legal standard is pretty well established. I certainly would contend if you rule in their favor, you're going to have to depart from that standard. But how? Well, because... Obviously, as they point out, we did not... contend that the law is you should err on the side of full disclosure. Sure. But it's also clear that the consequence for a non-disclosure is directly tied to the materiality of the information. And the Texas Supreme Court has said at least three times that you need not disclose relationships that are trivial. And this reflects a balance, obviously. Terule, in the context of the question being asked. I'm sorry

... There were three attorneys that Shipley Snow who worked on the arbitration. Mr. Shipley, Mr. Snow and Miss Miller. Miss Miller never worked at backer bots, so that has never been an issue. Miss Nell remembers that she did, as a young associate, one research project for Mr. Lewis. You can't remember what was about or anything about it. But she thinks she did a research project when she was young. Then... Oh, go ahead. In this case, whether... Terule, in your favor, do we make any law? No. Terule, in their favor, do we make any law in this case? Is it just really, as far as legal issues, or as far as worthy of publication, is essentially a wash? Well, I think the legal standard is pretty well established. I certainly would contend if you rule in their favor, you're going to have to depart from that standard. But how? Well, because... Obviously, as they point out, we did not... contend that the law is you should err on the side of full disclosure. Sure. But it's also clear that the consequence for a non-disclosure is directly tied to the materiality of the information. And the Texas Supreme Court has said at least three times that you need not disclose relationships that are trivial. And this reflects a balance, obviously. Terule, in the context of the question being asked. I'm sorry. Terule, in the context of the question being asked, such as a relationship between two people in Bancarports, I wouldn't say an abstract, it's trivial, but it's trivial in the context, arguably, whether it would disqualify a year later from... Terule, is a relative term. Terule, and these cases are obviously all done on a fact-based basis, depending on the facts. But it was... Great Americans burned a proof to show evident partiality here. And all they have shown is that there is a... at most, at the very most, that there is a tangential social relationship, not with the arbitrator, but with the arbitrator's partner and one of the attorneys for the parties. And there's two more points I want to make under Texas law that the Texas Supreme Court has mentioned. One, there's a distinction between past and current context. Because if it happened in the past, it's clearly not the same thing as something that's going on right now. There's also a distinction that's been made. Some parties in certain cases have said, there has to be maybe a more direct financial tie and courts have rejected that and said, no, it could be a familial relationship or it could be a close social relationship. But the only thing that courts have... and really the calls in cases, the only one that goes into a close social relationship and those facts are nothing like the ones here. But it has to be a close social relationship between the party or the party's attorney and the arbitrator, not a tangential social relationship where Mr. Shipley played golf with Mr. Lewis who was not the arbitrator, and he did it at a firm event where they were randomly paired together. And those facts go directly to the fact that everybody knew they were at Baker Botts together. Everybody knew that. No one has really contested that. But what they want to say is, well, there are these additional facts. But the additional facts all really stem from the fact that everybody was at Baker Botts together at some point in the past. Because, for instance, this... even this wedding issue, no one remembers Mr

. Terule, in the context of the question being asked, such as a relationship between two people in Bancarports, I wouldn't say an abstract, it's trivial, but it's trivial in the context, arguably, whether it would disqualify a year later from... Terule, is a relative term. Terule, and these cases are obviously all done on a fact-based basis, depending on the facts. But it was... Great Americans burned a proof to show evident partiality here. And all they have shown is that there is a... at most, at the very most, that there is a tangential social relationship, not with the arbitrator, but with the arbitrator's partner and one of the attorneys for the parties. And there's two more points I want to make under Texas law that the Texas Supreme Court has mentioned. One, there's a distinction between past and current context. Because if it happened in the past, it's clearly not the same thing as something that's going on right now. There's also a distinction that's been made. Some parties in certain cases have said, there has to be maybe a more direct financial tie and courts have rejected that and said, no, it could be a familial relationship or it could be a close social relationship. But the only thing that courts have... and really the calls in cases, the only one that goes into a close social relationship and those facts are nothing like the ones here. But it has to be a close social relationship between the party or the party's attorney and the arbitrator, not a tangential social relationship where Mr. Shipley played golf with Mr. Lewis who was not the arbitrator, and he did it at a firm event where they were randomly paired together. And those facts go directly to the fact that everybody knew they were at Baker Botts together. Everybody knew that. No one has really contested that. But what they want to say is, well, there are these additional facts. But the additional facts all really stem from the fact that everybody was at Baker Botts together at some point in the past. Because, for instance, this... even this wedding issue, no one remembers Mr. Lewis ever being at any wedding. But Mr. Shipley said, I sure invited a lot of Baker Botts people. And I can't say positively that he wasn't one of them. Don't remember it. And that goes also, both to your question about, do you have to remand for triviality? And I believe his answer was that you do. And because he wants more discovery. We disagree. The court found waiver, and we think that supported, amply by the record. But if it's not, for some reason, and you were to disagree, the court can always affirm on alternative basis. And the record was fully developed. We had some discussion back and forth about discovery before this hearing, the judge said a hearing, and they wanted to take some depositions. And we did some letter briefing to the district court, which is her internal procedures for how to deal with that. And we argued, you don't need depositions. We'll bring everybody from our law firm that you want. We'll bring them to the hearing. We're only talking about Mr. Lewis, because at the time they didn't even want Miss Marshall's deposition. But we said, he's within subpoena range. He's right down the street from the courthouse. You can subpoena him if you think you need him. Obviously the same would be true as to Miss Marshall. And we asked that they be at the hearing, so that we could cross-examine them on the waiver issue. Their position the whole time was that we didn't get to do that, because their actual knowledge just didn't matter, which is not at all Texas law. But this was brief to the court. The court came back and said, no depositions were having a full evidentiary hearing. The court was well within its discretion in denying those depositions. If for no other reason, then there was a full evidentiary hearing, and there's nothing that they needed that they could not get. Obviously, we also believe that there's, when the district courts deciding how much discovery to get into and a case like this, that you need to weigh. When are you going to allow the parties to delve into the quasi-judicial function of an arbitrator, and don't you need something a little bit more in order to do that? It's interesting. The speedy alternative to judicial resolution keeps it out of the federal courts. It does so much in arbitration. It's kind of coming full circle. You can't stay out of the federal court out of time, I'm convinced of that

. Lewis ever being at any wedding. But Mr. Shipley said, I sure invited a lot of Baker Botts people. And I can't say positively that he wasn't one of them. Don't remember it. And that goes also, both to your question about, do you have to remand for triviality? And I believe his answer was that you do. And because he wants more discovery. We disagree. The court found waiver, and we think that supported, amply by the record. But if it's not, for some reason, and you were to disagree, the court can always affirm on alternative basis. And the record was fully developed. We had some discussion back and forth about discovery before this hearing, the judge said a hearing, and they wanted to take some depositions. And we did some letter briefing to the district court, which is her internal procedures for how to deal with that. And we argued, you don't need depositions. We'll bring everybody from our law firm that you want. We'll bring them to the hearing. We're only talking about Mr. Lewis, because at the time they didn't even want Miss Marshall's deposition. But we said, he's within subpoena range. He's right down the street from the courthouse. You can subpoena him if you think you need him. Obviously the same would be true as to Miss Marshall. And we asked that they be at the hearing, so that we could cross-examine them on the waiver issue. Their position the whole time was that we didn't get to do that, because their actual knowledge just didn't matter, which is not at all Texas law. But this was brief to the court. The court came back and said, no depositions were having a full evidentiary hearing. The court was well within its discretion in denying those depositions. If for no other reason, then there was a full evidentiary hearing, and there's nothing that they needed that they could not get. Obviously, we also believe that there's, when the district courts deciding how much discovery to get into and a case like this, that you need to weigh. When are you going to allow the parties to delve into the quasi-judicial function of an arbitrator, and don't you need something a little bit more in order to do that? It's interesting. The speedy alternative to judicial resolution keeps it out of the federal courts. It does so much in arbitration. It's kind of coming full circle. You can't stay out of the federal court out of time, I'm convinced of that. I see I don't have a lot of time left, so I want to talk about a couple of things that were raised, particularly whether Tanaska means that the waiver must be reversed. I think I got sidetracked somewhere, but in Tuko, the court said, if you have actual knowledge, it's waived. In Marinor Financial, it cited all those cases saying, if it's well-known or easily discoverable, it's waived, but those aren't our facts here on a summer judgment record, and there's no evidence that they could have found this out. In Tanaska, court found no waiver, but it cites both Tuko and Marinor Financial statements that a waiver occurs if you know facts and did not object. There is no dispute here that they knew that all that they did not know, arguably, is, well, frankly stuff that I don't know that Miss Marshall has any obligation to ever to disclose each golf game and one single dinner in 23 years that her partner has with somebody. But anything that wasn't disclosed is directly relates to the fact that they were all at Baker-Bots at the same time. That's actual knowledge, the court found actual knowledge, and that is sufficient in and of itself, and clearly as Texas Law, there's no indication anywhere that a Texas court has said that you can just wait, even if you know these things, and wait and come back and wait till the ruling is adverse and then start looking into the evident partiality question. My time is almost up. What has happened? Thank you, Tom Jarg, you went pretty well. Mr. Anders, we'll have you from here, please. Mr. Anders, important to remember, this is a Texas arbitration at case, not a federal arbitration at case. In Tanasca, the case that the Supreme Court found no waiver on, the non-disclosing party also was aware of the facts that they were complaining about on appeal. The difference was, in that case, first of all, the arbitrator made those disclosures, whereas in this case, we've got zero disclosures from the arbitrator. In that case, the Texas Supreme Court said it's not good enough that you disclose some of the information, for example, the... Is there any evidence that Diana Marshall knew that Lewis had played golf with? Is it chiply? Or that Lewis had been invited to chiple's daughters wedding? I have no evidence of that in the record because we were not permitted to depose. I have an evidentiary here in the Assembly. We did not have depositions. We did not have any pre-trial... Was Diana Marshall at the evidentiary hearing? No, not. Could you have subpoenaed her? We could have subpoenaed her. And did she? We did not. We had no... Because we had no discovery, we had no idea what she would say. Was Mr. Lewis at the hearing? He was not. Did you have subpoenaed him? We could have

. I see I don't have a lot of time left, so I want to talk about a couple of things that were raised, particularly whether Tanaska means that the waiver must be reversed. I think I got sidetracked somewhere, but in Tuko, the court said, if you have actual knowledge, it's waived. In Marinor Financial, it cited all those cases saying, if it's well-known or easily discoverable, it's waived, but those aren't our facts here on a summer judgment record, and there's no evidence that they could have found this out. In Tanaska, court found no waiver, but it cites both Tuko and Marinor Financial statements that a waiver occurs if you know facts and did not object. There is no dispute here that they knew that all that they did not know, arguably, is, well, frankly stuff that I don't know that Miss Marshall has any obligation to ever to disclose each golf game and one single dinner in 23 years that her partner has with somebody. But anything that wasn't disclosed is directly relates to the fact that they were all at Baker-Bots at the same time. That's actual knowledge, the court found actual knowledge, and that is sufficient in and of itself, and clearly as Texas Law, there's no indication anywhere that a Texas court has said that you can just wait, even if you know these things, and wait and come back and wait till the ruling is adverse and then start looking into the evident partiality question. My time is almost up. What has happened? Thank you, Tom Jarg, you went pretty well. Mr. Anders, we'll have you from here, please. Mr. Anders, important to remember, this is a Texas arbitration at case, not a federal arbitration at case. In Tanasca, the case that the Supreme Court found no waiver on, the non-disclosing party also was aware of the facts that they were complaining about on appeal. The difference was, in that case, first of all, the arbitrator made those disclosures, whereas in this case, we've got zero disclosures from the arbitrator. In that case, the Texas Supreme Court said it's not good enough that you disclose some of the information, for example, the... Is there any evidence that Diana Marshall knew that Lewis had played golf with? Is it chiply? Or that Lewis had been invited to chiple's daughters wedding? I have no evidence of that in the record because we were not permitted to depose. I have an evidentiary here in the Assembly. We did not have depositions. We did not have any pre-trial... Was Diana Marshall at the evidentiary hearing? No, not. Could you have subpoenaed her? We could have subpoenaed her. And did she? We did not. We had no... Because we had no discovery, we had no idea what she would say. Was Mr. Lewis at the hearing? He was not. Did you have subpoenaed him? We could have. But again, without any discovery, we had no way to cross-examine them. We had no way to test the veracity of the statements, the completeness of the statement. That's an interesting theory of trial, but I must say that... I mean, do you really expect an argument? I can't take the deposition. I can't put them... I don't dare put them on the stand. Even though it's a crucial witness. Well, or honor, then we should probably just go to trial. We have a lot faster cases if we didn't have... Did you need go to trial? I don't know. I never did your hearing. That's one of the things without discovery. Yeah. Without discovery, though. But, you know, cross-examination is cross-examination. And you could have... You know, you're always afraid to ask a question. You don't know the answer to it. And then you just have to step up to it to that point. Ask some questions. You don't know the answer to it. Was Diana Marshall's web link site sent to your side? I did not get a print out of that. I got a transmittal letter that had been... With the link

. But again, without any discovery, we had no way to cross-examine them. We had no way to test the veracity of the statements, the completeness of the statement. That's an interesting theory of trial, but I must say that... I mean, do you really expect an argument? I can't take the deposition. I can't put them... I don't dare put them on the stand. Even though it's a crucial witness. Well, or honor, then we should probably just go to trial. We have a lot faster cases if we didn't have... Did you need go to trial? I don't know. I never did your hearing. That's one of the things without discovery. Yeah. Without discovery, though. But, you know, cross-examination is cross-examination. And you could have... You know, you're always afraid to ask a question. You don't know the answer to it. And then you just have to step up to it to that point. Ask some questions. You don't know the answer to it. Was Diana Marshall's web link site sent to your side? I did not get a print out of that. I got a transmittal letter that had been... With the link. That had enlisted them. And was all the information that Council said was on the website... On the website. I do not know. I honestly believe that the details of the relationships that we're complaining about, the golf games, the dinner party... So, you think Diana Marshall would know that Mr. Lewis had played golf with Mr. Shipley once or twice... And that Mr. Lewis might have been invited to Mr. Shipley's daughter's wedding. You think Diana Marshall knew that? 17 years after she left Baker Box. I think Diana Marshall knew that Mr. Lewis had a relationship with not just Mr. Shipley, but almost all the attorneys at Mr. Shipley's firm. He... Several feet from her and could have gone. She was in the bench. In subpoena to ask her because your hand hadn't had discovered. Yes, Ron. Where do we go? Where do we go? It is what it is. It is what happened, Judge. But again, the point here is I believe the focus instead of it being on the non-disclosing party..

. That had enlisted them. And was all the information that Council said was on the website... On the website. I do not know. I honestly believe that the details of the relationships that we're complaining about, the golf games, the dinner party... So, you think Diana Marshall would know that Mr. Lewis had played golf with Mr. Shipley once or twice... And that Mr. Lewis might have been invited to Mr. Shipley's daughter's wedding. You think Diana Marshall knew that? 17 years after she left Baker Box. I think Diana Marshall knew that Mr. Lewis had a relationship with not just Mr. Shipley, but almost all the attorneys at Mr. Shipley's firm. He... Several feet from her and could have gone. She was in the bench. In subpoena to ask her because your hand hadn't had discovered. Yes, Ron. Where do we go? Where do we go? It is what it is. It is what happened, Judge. But again, the point here is I believe the focus instead of it being on the non-disclosing party... What do you expect a reasonable arbitrator to disclose about their law partners? Do you expect them to go to every law partner and say... Have you ever played golf, tennis, volleyball with any of these people? Have you ever been invited to any of their weddings to give them a list of every law you're involved? I believe it would be simple enough to say I've got an arbitration request from this person. Do you know them? Do you have any relationship with them and ask the question? And then disclose the answer? And what would the answer typically be when you've been... Well... That Lewis had been gone for Baker Box several years, Diana Marshall been gone since the 90s. Right, and again, that would have been disclosedable and then we could have... What would have been disclosedable? The existence of the relationship and the details. Well, it was... Anybody that gone to the website would have known they were both at Baker Box. What beyond that do you expect an arbitrator to disclose? Whether they worked together on cases, whether they had social relationships, whether they attended social functions together. And there's no evidence they work together on cases? The only evidence that we were able... That we have is what Mr. Shipley said in his affidavit. And you did have the affidavit. Was it a grade that the affidavit could be used as evidence at trial? The affidavit was admitted as trial. And you could have called Mr. Shipley at trial. You could have called Mr. Lewis. You could have subpoenaed them. We did call Mr. Shipley at trial

. What do you expect a reasonable arbitrator to disclose about their law partners? Do you expect them to go to every law partner and say... Have you ever played golf, tennis, volleyball with any of these people? Have you ever been invited to any of their weddings to give them a list of every law you're involved? I believe it would be simple enough to say I've got an arbitration request from this person. Do you know them? Do you have any relationship with them and ask the question? And then disclose the answer? And what would the answer typically be when you've been... Well... That Lewis had been gone for Baker Box several years, Diana Marshall been gone since the 90s. Right, and again, that would have been disclosedable and then we could have... What would have been disclosedable? The existence of the relationship and the details. Well, it was... Anybody that gone to the website would have known they were both at Baker Box. What beyond that do you expect an arbitrator to disclose? Whether they worked together on cases, whether they had social relationships, whether they attended social functions together. And there's no evidence they work together on cases? The only evidence that we were able... That we have is what Mr. Shipley said in his affidavit. And you did have the affidavit. Was it a grade that the affidavit could be used as evidence at trial? The affidavit was admitted as trial. And you could have called Mr. Shipley at trial. You could have called Mr. Lewis. You could have subpoenaed them. We did call Mr. Shipley at trial. And yes, we could have subpoenaed Mr. Shipley at trial. And you don't think Mr. Shipley told the truth? Well, I believe what he says is I can't recall, in which case then I believe the records, the documents that we were not allowed to get, would help shed light on you. So you come up with an invitation that was sent in the mail to Mr. Lewis. Then do you go to the jewelry store to see if he gave her a gift and how much? Well, I believe we could have asked Mr. Lewis about the details of his relationships, prepare for the trial. I mean, just where's this end is what I'm getting at? I believe it ends with the arbitrator making full disclosure. And I believe it starts an end. What is full disclosure, though, man? That full disclosure, according to the Texas Supreme Court, would be the existence of relationships and the facts about those relationships. Well, you know, it's interesting at Baker Botchy that they played golf with them. What you put to find a point on that is that it's a firm gathering and they end up signing people over the random basis and it's quote, retrovacists. And the hallmark of that is that they try to introduce the partners and the associates to each other from time to time. They don't know each other getting played together. That's a real world. The social relationship, they got them to play together with them. Tell them you got to go play together. I'm just shocked at the Baker Bot's lawyer. I know it's had to play golf. And that's a four and a half, five hour time together to get to know each other. I've looked at a lot of time records and turned it to the application. I never saw it. Any time left for golf. And they won't crack soon. Okay, well thank you very much for your arguments. That concludes the arguments. Just panel will have to be done.

On the next case of the day, it's still Eplea I or the seal. So on. And then Mr. Andish will give me. Please the court. My name is David Andes. I'm here representing the seal of the Pellant. The rule of full disclosure minimizes the role of judiciary, besting greater control in the parties who have chosen the arbitration process. If faithfully adhere to, it will ultimately lead to fewer post-decision challenges to awards based on bias or prejudice. That is a quote from the Tukko case, which is a Texas Supreme Court decision in 1997 that set up the test for evident partiality under Texas law. Filtration of partiality and arbitration is the exclusive prerogative of the parties and only the parties. Under Texas law, it is a party's right to have all the information disclosed by the arbitrator so that the party, not the courts, not the arbitrator, can decide whether to accept the candidate or reject the potential arbitrator. Judge Owen, your former court in May of this year unanimously reinforced the full disclosure requirement by holding that a party does not waive an evident partiality challenge when some information is disclosed and the non-disclosing party does not conduct any further investigation. That is, a non-disclosing party may have actual knowledge of some information but has no duty, no duty, to investigate any further or risk waiver. Father, disclosure or knowledge of the existence of a relationship. What are you complaining about now? John, we've got several points on appeal. My primary purpose today is to talk about the failure. What are you complaining about? What is the... I'm sorry, we're heading to Kansas. We're complaining about the wholesale failure of an arbitrator appointed by a party to disclose an extensive relationship between herself and the lawyer for one of the parties as... What is this extensive relationship you're talking about? John, I have a list. It was pretty true, you hold it. Your Honor, I have a list of items here. First of all, Mr. George Shipley, who's counseled for Federal Insurance Company in the arbitration, worked at Baker-Bots law for 34 years. What are you sintering on though? I mean, I understand that. The Gulder Wedins, where do we draw the line? The Gulder Wedins go to parties? It's the collection in this case, Your Honor. It's the totality of what was not disclosed. Okay, sure, it's a single thing that's not disclosed. Well, in this case, not a single thing was disclosed. Nothing. All right, and then your side had equal relations with some of the lawyers involved in the case. I mean, it was just... How do you get out of... You know, call practices, so in bread now, with everybody's musical chairs going from one firm to the other. How do you find somebody that's pristine, pure? And I don't know that that's a requirement, Your Honor. That's basically what you're saying. The name of the game is you lose the arbitration, then you look. I'm sorry, Your Honor? You lose the arbitration, then you start looking for all these conflicts. That's the way I read some of this happening. When you start talking about somebody, whether they had an extensive conflict, they were partying law together for 20 years. Like you didn't know that? I mean, you were going to a wedding or a party and had some side of social contact. Baker Bonson, not exactly a small little law firm. They got the case before the Supreme Court, now seeking an additional few million more to top of a sick... It's a big operation. I mean, you know, that's what troubles me about that. I don't mean... I'm never... I represent your client, but it just... I have a hard time saying what that adds up to. Your Honor, first of all, it starts with non-disclosure. We got nothing. We got nothing. So basically... No, no, no, no, no. I mean, you have got something. She does tell you. You know she's practiced for Baker Bonson. You know she's practiced a long time. And you know that Mr. Shipper has been there for a long time. So I mean, there are a lot of assumptions that you can truly make... That a reasonable person can make them. Are you talking about the disclosure requirement itself that... If that's common knowledge, there's no needs of disclosure, no? Well, more or less. I mean, if it's... I mean, not common knowledge. It's not... But I mean, if you know someone has been practicing law with someone else for 20 years... And you knew that. You had to know that, right? I personally did not know that. Well, I mean, you... Well, I mean, just a little... A minimal kind of research or not even research, but just common knowledge. If you know both how I've been with Baker Bonson. Well, you have an arbitrator. You don't look... You know, you get an arbitrator. You look down there. You don't look them up and say, well, what the background is? You're going to be arguing for these people. You're on it. I can't tell you what... Obviously everybody does, but I do think that... What are you doing? You just put the first six out of you in the box, and we will try this case right here. You don't do that. You're on it. I mean, we first of all, we looked at the disclosure. And we rely upon the disclosure of the arbitrator herself. And at that point, then the question becomes, how far... What did she disclose? What did she disclose? Nothing. Did she have a curriculum v-tie attached or anything like that? No, ma'am. Did she disclose that she had practiced law with Baker Bonson? Did she name close that? No, you're on it. She just... Nobody knew Diana Marshall. I'm shocked. Nobody knew Diana Marshall where she came from. Well, I'm not saying that. I'm saying to she... What do I mean to say? Well, I mean... She's a well-known figure in Houston. Everybody knows who she is, where she's been. And... Knowledge of someone's status, Ron, or I don't think it quakes the knowledge of the details of relationships that she may have on an ongoing... How many large and hestand are qualified arbitrators? And if he say they work together a big firm and they socialized? And I'm not saying that that disqualifies the arbitrator. All I'm saying is, first, it starts with disclosure. So everybody that you have to say, well, I was with three big firms and I... And then ask, am I currently... That's a huge disclosure obligation. Well, how many weddings did I go to? How many parties did I go to? How many lunchances did I have with so-and-so? And the arbitrator is a person who has exclusive knowledge of that information, your honor. And the point of the disclosure... Well, your argument sounds very close to just my saying that the end of this disclosure is self-proviscerated to the Harvard Award, non-disclosure. Even though the lawyers knew the information, if they'd breached their obligation to disclose it, is that true? I'll say to you another way, does the circumstance that you... This is common knowledge and you knew it? It self-answered solve a problem or not? You ought to understand that. In other words, you said it aside, you knew about it? Under Texas Law, your honor, which is different. Well, yes or no about that. You tell me why, but in your theory, is that enough? Under the current state of Texas Law, yes or no, that would be said. So it comes down to that. It's an undisclosure. And so maybe that's one reason you don't want to check them out. You're going to take the opportunity. You know they're okay, but I don't want to do much searching because I can... I'll leave a searching if I lose. Well, that raises another question. How far do you search before you find this missing pearl to information? Where your arbitrator practices law? I mean, I really found it incredulous that you would try a large arbitration case before three arbitrators, that you don't know anything about it. I participate in arbitration, most of the lawyers, I even 40 years ago when I was in pro-practice. Let me tell you, I knew two of the arbitrators very, very well. And the third one they picked, I did everything in the world to find out about them because that was going to be the deciding. And I thought I would have been getting them out of practice if I didn't know where they practiced, what they did, and what they're written, and thought about the best I could find out. If I'm missing something here, I'm just trying to understand the argument. I believe the argument in your honor is in a wholesale failure to disclose anything whatsoever. The question is how much of that then shifts to the non-disclosing party to go and fair it out the information. Because admittedly some information... What do you have other than the Baker bot? I'm sorry? What do you have other than the Baker bot's connection? Well, the Baker bot starts the connection, and then we have personal connections between almost every lawyer and the law firm representing the other side, and the sole law partner of Miss Marshall, that was not disclosed. We have a dinner party together between the spouses and the lawyer and her partner. We have a golf outing, we have a wedding, and a possibly a wedding that was attended... This is not with her. This is with their law partner. With their law partner. That's right. Who you're for you, Mr. Benton, had even greater association with. I don't know... That's what the breaches indicate. And that's what the breaches say, but I don't know personally, your honor, whether or not that's true. Well, you're unchallenged it. I'm seeing you in a reply, a breaches say it's a bunch of lies. I'm just going off the record before the court, your honor, before the district court. I'm not trying to introduce additional evidence because we were as part of our complaint, is that we were limited in our ability to... Tell me why social contacts between an arbitrator's law partner and a party's lawyer leads the evident partiality, first off as between the lawyer and the law partner, and then second step between the arbitrator. Where does that give rise to evident partiality? On under Texas law, the view is that it's an objective observer test. That's the... And an objective observer would think that because Diana Marshall's law partner, Lewis, was... I'm sorry, law... Shipley was friends with Mr. Lewis and had a social relationship that that would mean she would favor Mr. Lewis. Well, and again, it's in terms of might. The Texas Supreme Court has said that a evident partiality under the Texas Arbitration Act, if the arbitrator does not disclose information which might... Might, but go on and continue to what? To an objective observer? That's where I'm saying that what objective observer would say that. Is that a legal question or is that a fact question? What if this case were in Tyler? What if this case were in Tyler, not Houston, or Bay City? Again, full disclosure. We're not arguing whether it actually disqualifies them to serve as an object. What I'm asking about the test, what someone reasonably think, because there are relationships between these people that that might cause them to be partial. I don't know if it's a geographic test. Well, I'm looking to realities. I understand. I would say that, you know, I don't know. I honestly don't know if it's in Tyler. It's different than say in Houston or Austin. I just know that that is the test of Supreme Court is set forth that we are here struggling with. Why, as you know, I did not agree with the test and Tom Phillips who wrote the opinion of the sense of disavowed it, at least privately, but in any bid it is the law. Yes, Your Honor. And again, it's not, and it not only just might, but it's a reasonable impression of the arbitrator's partiality. And I think that the Texas Supreme Court is viewing, they want full disclosure. They have yet to find a case of waiver. They have yet to excuse any non-disclosure that has reached them. Should we certify this case? I think if you did, Your Honor, they'd come back and say see the tenaska opinion that came out in May of this year. But, and I think it's been answered. I really do. What, I mean, from your point of view, what does tenaska hold? And in two sentences. That a party does not waive an evident partiality challenge by having some knowledge of the existence of relationship, but not the substance or details. Okay. So, I think that we have a question. I think that we have a question. I think that we have a question. I think that we have a question. I think that we have a question. I think that we have a question. I think that we have a question. I think that we have a question. I think that we have a question. I think that we have a question. I think that we have a question. I think that we have a question. I think that we have a question. I think that we have a question. You know, it's all true here. That would be the next, that would actually be the question. Is it trivial or not? That's a question, because what I've got to decide? Objection. I mean, if we decide the objection is immaterial or correct. And your honor, the district court originally vacated the award because that the connection was not trivial. Then, the district court vacated the vacator. But the balance line's not trivial. Because again, the collectivity of the information that was not disclosed. You mentioned a minute ago that about a pearl, how did I know there's a pearl in here? So where is the pearl here that you referred to? I mean, miss, about 30 or none disclosed. It's the collection of information that was not disclosed. Well, there are pearls, not a pearl. Collectively, yes, you're right. Collectively. The district court did not reach the triviality issue on the second go round because she found waiver based on the tenasca case that came out of the Dallas Court of Appeals that then was subsequently reversed by the Texas Supreme Court. What are you saying that we would have to remain for her to make that decision? Or is it just simply a matter of law? We could just simply say that this is not a amount to evident partiality. You're on our belief that the evidence that is already in the record supports that it is evidently partial and it's not trivial. But if this court believes otherwise, it could, excuse me, it could reverse and render based on that. If it believes that there's a question of triviality, it would have to reverse and remain and we would have to be allowed discovery to then develop the record for the district court. Yeah. You set up this question, interesting, the last step to hide from the arbitrators, the effect of their decision. How did that work? I thought there was a, the arbitrator's turn, what the legal questions the arbitrator would settle would be and what the dollar consequence of the answer would be. If question one is yes, one part is a one of the million, if question one and two, no, one part is a one and seven million. Does that mean that the arbitrators did not know which party would prevail, but then on the answers? I suppose they could have figured it out because obviously at the hearing, the parties were arguing very specifically for certain answers. We were arguing for, I believe we were arguing for no and they were arguing for no. Why would you set it up that way unless it was to create a blonde system so that the arbitrators would be determining that abstract question without knowing the particular outcome of it? I think we would be. Why is it that relevant to whether the inquiry is to objective observer? Is it, I mean, I don't, maybe if they're in there trying for you, they're going to have to figure out what it is. Maybe that, maybe you could say that's evident. If it's yes or no, one, but I think at the hearing, your answer is very clear. It's true then why did you do it that way? I think we were trying to get the most objective, unbiased panel that we could. I do and I don't think it works. I think we tried. Okay, thank you very much. You certainly saved time for a battle misunderstandess. Miss Maddox? May I please the court, Amy Douthett Maddox for Federal Insurance Company who is the sealed Apple E in this case. Based on opposing counsel's argument and the court's questions, I plan to concentrate my argument on evident partiality and waiver by managing my time well also, probably touch on the issue of discovery and that goes along with the issue of remand that Judge Jolly brought up. I don't plan to address subject matter jurisdiction or the exceeding authority manifesto, cigar, et cetera, unless the court has any particular questions on those. There is not a single case that supports vacating an arbitration award on facts that are so tenuous and so remote and time as they are in this one. There is also not a single case that holds that a party or a party's attorney can have actual knowledge of the very facts that they later argue constitute evident partiality but keep those facts or that knowledge in their back pocket until they find out whether they've won or lost the arbitration and then argue, well, there was no disclosure so it doesn't matter what we knew, there's evident partiality simply from the fact that there was no disclosure at all. This case is governed. I don't think there's much dispute about the law. Are there any record development of whether there was actual knowledge of these relates of the fact of the law firm connections? Yes, there was. There was an evidence you're hearing held before the district court. Several people testified. The court also took stated with agreement of the parties that the affidavits that were submitted in connection with federal's motion for reconsideration would also be part of the record. And then great Americans, lawyers were able to cross examine all the Shipley-Snell Montgomery attorneys that were there. And Mr. Shipley called Mr. Andes and Mr. Benton to the stand. There was evidence for Mr. Shipley. There was evidence for Miss Schnell. There was evidence for Mr. Benton that they had actual knowledge that George Shipley was at Baker-Bots, that Miss Marshall's partner, Mr. Lewis, was at Baker-Bots. There was also evidence that when Miss Marshall was designated, which was done by letter, there was a link to her website. Mr. Shipley sent the letter to Mr. Andes. There's a link to her website. And merely clicking on her website and clicking on Diana Marshall shows that she was at Baker-Bots for a number of years. And in fact, going to Judge Owens' question, her CV was on there, her resume was on there as well. And the district court made fact findings. And to some extent, I think that's where Tanasca comes in. The district court made fact findings. Four places, the district court said they had actual knowledge, including of Miss Marshall, because the evidence that was presented at the hearing was before Miss Marshall was designated, federal designated Murray Folgler of Becker-Eddon. As a Texas court, in Texas law developed the impact of the actual knowledge that it translate only into a waiver or how does that handle in the Texas law? Well, the three cases are basically a trilogy of cases, two-go, Mariner Financial and Tanasca. The concurrence in Mariner Financial discusses a little bit where should certain knowledge go. All of those cases, those say, two-go says, in footnote nine, a party who knows of a conflict before an arbitrator issues an opinion must promptly object to avoid waiver. In each of those subsequent cases, did they find waiver? No. Mariner Financial discusses all the waiver cases, even including from other jurisdictions, and says notes that those cases hold that there's waiver when there's an undisclosed relationship is either well-known or easily discoverable. But Mariner Financial was a summary judgment case, and the court howled that there was no summary judgment evidence that they could have discovered anything had they tried, and so that case was remanded. Tanasca is a case that, again, the court howled that there was no waiver in that case. In that case, again, based on the trial court's fact findings in that case, the arbitrator had made some disclosures, and one of the disclosures he made is that he was affiliated, he was a director of this legal outsourcing company, and that he'd had a meeting with the law firm that was representing one of the parties in the arbitrator, a large law firm, 750 members or something like this. But that wasn't clear that there'd be ever been any business. The facts that came out there were that not only did he have a much greater role in this legal outsourcing company, but he had contact, not just with the law firm, but with those two members that were before him, ongoing contact, where he was trying to solicit business on behalf of this company from the very people who were appearing before him. And so obviously, the Supreme Court said, well, that's a situation where a reasonable observer can look at that and say, well, he might be more likely to favor this side because he's trying to get their business right now. If you contrast that with our facts, what we have here is everybody knew that all these people worked at Baker Botts together. Miss Marshall worked at Baker Botts some 16, 17 years ago. I don't think we know what month she left, so we can't come somewhere in there. 16, 17 years ago, almost two decades ago. Her partner, who was not the arbitrator in this case and had nothing to do the arbitration in this case, and there's no allegation that he did, was there some five years before the arbitration. And they were able to examine anybody they wanted to at this evidentiary hearing. Let me have one question about. An earlier third arbitrator was dismissed for what reason? He wasn't really dismissed what happened is federal appointed him. And this actually, the evidence, the point? Our side, federal insurance company, appointed Mr. Fogler as our arbitrator. And he's with Beck Redden, and he made some minimal disclosures. And then what happened is they went and fished around on the Beck Redden website. And they found out that Beck Redden had represented Memorial Herman and some other stuff, Memorial Herman, was an insured, etc., etc. They came back to us and had some questions and we said they were research. They did their research. And nobody ever objected to him is how it came about. It just seemed like they weren't ever going to agree. So we said, never mind, we're going to nominate. I'm not going to give you a built-in error. Yes, so we nominated Marshall instead. And that was the basis for the district court's finding. She found that... I didn't mean to. Stracture from your... She found that they knew about Marshall as well. Because she found it inconceivable, particularly based on the investigation they did of folklore that they didn't at least click on the website and look. So everybody knew that all these people were at backer bots many years before the arbitration. Everybody knew that. So... They want to make more. They say that there is a collection of contacts. But the evidence came out. And the evidence was as to Miss Marshall. Even when they were at backer bots, they never worked together. The only time that George Shipley could remember anything was that she apparently participated in the in-house need of program when he was a second or third year associate and he was required to go to that. He's... Oh, 17 years ago. This would gosh, this would be more than 17 years ago. That's when she left. This is when he's a young associate. He has run into her a couple times or may just be once. And an American college of trial lawyers luncheon that had some 200 people in there. Clearly, he knew her to say hi because they used to work at backer bots together. This is the evidence that came out. As to Mr. Lewis, who again was not the arbitrator in this case, the evidence was that again, there was really very... Mr. Shipley never worked with Mr. Lewis. Miss Nell, who was the other... There were three attorneys that Shipley Snow who worked on the arbitration. Mr. Shipley, Mr. Snow and Miss Miller. Miss Miller never worked at backer bots, so that has never been an issue. Miss Nell remembers that she did, as a young associate, one research project for Mr. Lewis. You can't remember what was about or anything about it. But she thinks she did a research project when she was young. Then... Oh, go ahead. In this case, whether... Terule, in your favor, do we make any law? No. Terule, in their favor, do we make any law in this case? Is it just really, as far as legal issues, or as far as worthy of publication, is essentially a wash? Well, I think the legal standard is pretty well established. I certainly would contend if you rule in their favor, you're going to have to depart from that standard. But how? Well, because... Obviously, as they point out, we did not... contend that the law is you should err on the side of full disclosure. Sure. But it's also clear that the consequence for a non-disclosure is directly tied to the materiality of the information. And the Texas Supreme Court has said at least three times that you need not disclose relationships that are trivial. And this reflects a balance, obviously. Terule, in the context of the question being asked. I'm sorry. Terule, in the context of the question being asked, such as a relationship between two people in Bancarports, I wouldn't say an abstract, it's trivial, but it's trivial in the context, arguably, whether it would disqualify a year later from... Terule, is a relative term. Terule, and these cases are obviously all done on a fact-based basis, depending on the facts. But it was... Great Americans burned a proof to show evident partiality here. And all they have shown is that there is a... at most, at the very most, that there is a tangential social relationship, not with the arbitrator, but with the arbitrator's partner and one of the attorneys for the parties. And there's two more points I want to make under Texas law that the Texas Supreme Court has mentioned. One, there's a distinction between past and current context. Because if it happened in the past, it's clearly not the same thing as something that's going on right now. There's also a distinction that's been made. Some parties in certain cases have said, there has to be maybe a more direct financial tie and courts have rejected that and said, no, it could be a familial relationship or it could be a close social relationship. But the only thing that courts have... and really the calls in cases, the only one that goes into a close social relationship and those facts are nothing like the ones here. But it has to be a close social relationship between the party or the party's attorney and the arbitrator, not a tangential social relationship where Mr. Shipley played golf with Mr. Lewis who was not the arbitrator, and he did it at a firm event where they were randomly paired together. And those facts go directly to the fact that everybody knew they were at Baker Botts together. Everybody knew that. No one has really contested that. But what they want to say is, well, there are these additional facts. But the additional facts all really stem from the fact that everybody was at Baker Botts together at some point in the past. Because, for instance, this... even this wedding issue, no one remembers Mr. Lewis ever being at any wedding. But Mr. Shipley said, I sure invited a lot of Baker Botts people. And I can't say positively that he wasn't one of them. Don't remember it. And that goes also, both to your question about, do you have to remand for triviality? And I believe his answer was that you do. And because he wants more discovery. We disagree. The court found waiver, and we think that supported, amply by the record. But if it's not, for some reason, and you were to disagree, the court can always affirm on alternative basis. And the record was fully developed. We had some discussion back and forth about discovery before this hearing, the judge said a hearing, and they wanted to take some depositions. And we did some letter briefing to the district court, which is her internal procedures for how to deal with that. And we argued, you don't need depositions. We'll bring everybody from our law firm that you want. We'll bring them to the hearing. We're only talking about Mr. Lewis, because at the time they didn't even want Miss Marshall's deposition. But we said, he's within subpoena range. He's right down the street from the courthouse. You can subpoena him if you think you need him. Obviously the same would be true as to Miss Marshall. And we asked that they be at the hearing, so that we could cross-examine them on the waiver issue. Their position the whole time was that we didn't get to do that, because their actual knowledge just didn't matter, which is not at all Texas law. But this was brief to the court. The court came back and said, no depositions were having a full evidentiary hearing. The court was well within its discretion in denying those depositions. If for no other reason, then there was a full evidentiary hearing, and there's nothing that they needed that they could not get. Obviously, we also believe that there's, when the district courts deciding how much discovery to get into and a case like this, that you need to weigh. When are you going to allow the parties to delve into the quasi-judicial function of an arbitrator, and don't you need something a little bit more in order to do that? It's interesting. The speedy alternative to judicial resolution keeps it out of the federal courts. It does so much in arbitration. It's kind of coming full circle. You can't stay out of the federal court out of time, I'm convinced of that. I see I don't have a lot of time left, so I want to talk about a couple of things that were raised, particularly whether Tanaska means that the waiver must be reversed. I think I got sidetracked somewhere, but in Tuko, the court said, if you have actual knowledge, it's waived. In Marinor Financial, it cited all those cases saying, if it's well-known or easily discoverable, it's waived, but those aren't our facts here on a summer judgment record, and there's no evidence that they could have found this out. In Tanaska, court found no waiver, but it cites both Tuko and Marinor Financial statements that a waiver occurs if you know facts and did not object. There is no dispute here that they knew that all that they did not know, arguably, is, well, frankly stuff that I don't know that Miss Marshall has any obligation to ever to disclose each golf game and one single dinner in 23 years that her partner has with somebody. But anything that wasn't disclosed is directly relates to the fact that they were all at Baker-Bots at the same time. That's actual knowledge, the court found actual knowledge, and that is sufficient in and of itself, and clearly as Texas Law, there's no indication anywhere that a Texas court has said that you can just wait, even if you know these things, and wait and come back and wait till the ruling is adverse and then start looking into the evident partiality question. My time is almost up. What has happened? Thank you, Tom Jarg, you went pretty well. Mr. Anders, we'll have you from here, please. Mr. Anders, important to remember, this is a Texas arbitration at case, not a federal arbitration at case. In Tanasca, the case that the Supreme Court found no waiver on, the non-disclosing party also was aware of the facts that they were complaining about on appeal. The difference was, in that case, first of all, the arbitrator made those disclosures, whereas in this case, we've got zero disclosures from the arbitrator. In that case, the Texas Supreme Court said it's not good enough that you disclose some of the information, for example, the... Is there any evidence that Diana Marshall knew that Lewis had played golf with? Is it chiply? Or that Lewis had been invited to chiple's daughters wedding? I have no evidence of that in the record because we were not permitted to depose. I have an evidentiary here in the Assembly. We did not have depositions. We did not have any pre-trial... Was Diana Marshall at the evidentiary hearing? No, not. Could you have subpoenaed her? We could have subpoenaed her. And did she? We did not. We had no... Because we had no discovery, we had no idea what she would say. Was Mr. Lewis at the hearing? He was not. Did you have subpoenaed him? We could have. But again, without any discovery, we had no way to cross-examine them. We had no way to test the veracity of the statements, the completeness of the statement. That's an interesting theory of trial, but I must say that... I mean, do you really expect an argument? I can't take the deposition. I can't put them... I don't dare put them on the stand. Even though it's a crucial witness. Well, or honor, then we should probably just go to trial. We have a lot faster cases if we didn't have... Did you need go to trial? I don't know. I never did your hearing. That's one of the things without discovery. Yeah. Without discovery, though. But, you know, cross-examination is cross-examination. And you could have... You know, you're always afraid to ask a question. You don't know the answer to it. And then you just have to step up to it to that point. Ask some questions. You don't know the answer to it. Was Diana Marshall's web link site sent to your side? I did not get a print out of that. I got a transmittal letter that had been... With the link. That had enlisted them. And was all the information that Council said was on the website... On the website. I do not know. I honestly believe that the details of the relationships that we're complaining about, the golf games, the dinner party... So, you think Diana Marshall would know that Mr. Lewis had played golf with Mr. Shipley once or twice... And that Mr. Lewis might have been invited to Mr. Shipley's daughter's wedding. You think Diana Marshall knew that? 17 years after she left Baker Box. I think Diana Marshall knew that Mr. Lewis had a relationship with not just Mr. Shipley, but almost all the attorneys at Mr. Shipley's firm. He... Several feet from her and could have gone. She was in the bench. In subpoena to ask her because your hand hadn't had discovered. Yes, Ron. Where do we go? Where do we go? It is what it is. It is what happened, Judge. But again, the point here is I believe the focus instead of it being on the non-disclosing party... What do you expect a reasonable arbitrator to disclose about their law partners? Do you expect them to go to every law partner and say... Have you ever played golf, tennis, volleyball with any of these people? Have you ever been invited to any of their weddings to give them a list of every law you're involved? I believe it would be simple enough to say I've got an arbitration request from this person. Do you know them? Do you have any relationship with them and ask the question? And then disclose the answer? And what would the answer typically be when you've been... Well... That Lewis had been gone for Baker Box several years, Diana Marshall been gone since the 90s. Right, and again, that would have been disclosedable and then we could have... What would have been disclosedable? The existence of the relationship and the details. Well, it was... Anybody that gone to the website would have known they were both at Baker Box. What beyond that do you expect an arbitrator to disclose? Whether they worked together on cases, whether they had social relationships, whether they attended social functions together. And there's no evidence they work together on cases? The only evidence that we were able... That we have is what Mr. Shipley said in his affidavit. And you did have the affidavit. Was it a grade that the affidavit could be used as evidence at trial? The affidavit was admitted as trial. And you could have called Mr. Shipley at trial. You could have called Mr. Lewis. You could have subpoenaed them. We did call Mr. Shipley at trial. And yes, we could have subpoenaed Mr. Shipley at trial. And you don't think Mr. Shipley told the truth? Well, I believe what he says is I can't recall, in which case then I believe the records, the documents that we were not allowed to get, would help shed light on you. So you come up with an invitation that was sent in the mail to Mr. Lewis. Then do you go to the jewelry store to see if he gave her a gift and how much? Well, I believe we could have asked Mr. Lewis about the details of his relationships, prepare for the trial. I mean, just where's this end is what I'm getting at? I believe it ends with the arbitrator making full disclosure. And I believe it starts an end. What is full disclosure, though, man? That full disclosure, according to the Texas Supreme Court, would be the existence of relationships and the facts about those relationships. Well, you know, it's interesting at Baker Botchy that they played golf with them. What you put to find a point on that is that it's a firm gathering and they end up signing people over the random basis and it's quote, retrovacists. And the hallmark of that is that they try to introduce the partners and the associates to each other from time to time. They don't know each other getting played together. That's a real world. The social relationship, they got them to play together with them. Tell them you got to go play together. I'm just shocked at the Baker Bot's lawyer. I know it's had to play golf. And that's a four and a half, five hour time together to get to know each other. I've looked at a lot of time records and turned it to the application. I never saw it. Any time left for golf. And they won't crack soon. Okay, well thank you very much for your arguments. That concludes the arguments. Just panel will have to be done