Seventh Circuit Affirms District Court’s Order Denying Application to Vacate Arbitration Award

Donald Kinsella was an employee of defendant Baker Hughes Oilfield Operations LLC. In June 2013, he suffered a work-related injury resulting in his disability and receipt of disability benefits for three years. Baker Hughes’ human resources department worked with Kinsella to look for jobs at the company that would meet his accommodation request and physical limitations. Months later, Kinsella received a termination letter from Baker Hughes citing a failure to apply for a position. He eventually filed an action in federal court alleging failure to accommodate his disability, discriminatory discharge, and retaliation under the Americans with Disabilities Act. Kinsella’s employment agreement included an arbitration clause, and the district court granted the parties’ joint motion to stay the federal action pending arbitration. The district court then dismissed the action without prejudice with leave to reinstate within seven days of the arbitration ruling.

The matter proceeded to arbitration, and the arbitrator issued an award granting summary judgment for Baker Hughes on all claims. Kinsella filed an application with the district court to reinstate his case and to vacate the arbitration award with regard to his failure-to-accommodate claim. He sought to vacate the award under section 10 of the Federal Arbitration Act contending that the arbitrator exceeded his powers by requiring illegitimate elements of proof on the failure-to-accommodate claim. The district court reinstated Kinsella’s action, but it denied the application to vacate the award and entered a judgment of dismissal. In affirming the district court’s denial of vacatur, the Seventh Circuit Court of Appeals first noted that under section 10(a)(4) of the FAA, an arbitration award may be vacated “where the arbitrators exceeded their powers, or so imperfectly executed them that a mutual, final, and definite award upon the subject matter submitted was not made.” The court rejected Kinsella’s contentions that the arbitrator incorrectly interpreted the ADA and exceeded his authority by introducing “an extra element of proof into a claim.” The court found the arbitrator did not exceed his powers and affirmed the district court’s denial of Kinsella’s application to vacate the award.

Kinsella v. Baker Hughes Oilfield Operations, LLC, No. 22-2007 (7th Cir. May 8, 2023).