Arbitrators May Not Subpoena Non-Parties, 2nd Circuit Rules

NEW YORK - Section 7 of the Federal Arbitration Act does not empower arbitration panels to subpoena non-parties, the 2nd Circuit U.S. Court of Appeals ruled Nov. 24 Life Receivables Trust v. Syndicate 102 at Lloyd's of London, No. 07-1197 (2nd Cir.).

The appellate panel, led by Judge Richard C. Wesley, adopted the 3rd Circuit's strict construction of the statute.

Life Receivables Trust owns a portfolio of life insurance policies originally bought by Peachtree Life Settlements, a life settlement provider. As owner and beneficiary of the policies, LRT paid the premiums and was entitled to the life insurance proceeds when …