Did American Arbitration Association arbitrator have a conflict-of-interest?
by Carol Thompson
An arbitrator for the American Arbitration Association is accused of hearing a case that may have been a conflict-of-interest.
As previously reported, a California resident lost an arbitration to Palms Place, LLC and was ordered by the arbitrator to pay nearly $90,000 in legal fees. The resident had made a deposit of $108,000 on a condominium that was to be built next to the Palms Casino in Las Vegas.
The arbitration was executed through the American Arbitration Association which touts itself as providing “neutrals”; arbitrators with no conflicts or ethical concerns. As the California resident learned after-the-fact, his case was decided by an arbitrator whose neutrality is now being called into question.
As of publication time, the American Arbitration Association had not responded to a request for comment.
Thomas Ryan, a partner in the Lewis Roca Rothgerber law firm was the arbitrator on the case. At no time did he disclose his or his firm’s connections with Palms Place owner George Maloof and Palms Casino minority owner Greenspun Corporation.
Lewis Roca Rothgerber is heavily involved in the casino gaming industry. According to the firm’s website, “Lewis Roca Rothgerber’s gaming practice group is a national practice that supports casino operators, suppliers, state and local governments, communities, businesses, non-profit organizations, tribal governments and others in addressing casino gaming law including Native American and riverboat casinos, racinos, interactive and mobile gaming, poker, and interstate horse racing.”
Ryan, along with three other Lewis Roca Rothgerber attorneys, currently represent Brian Greenspun, owner of The Greenspun Corporation in a pending federal district court case, Greenspun, et al. vs. Stephens Media, LLC, et al, according to court documents.
The Greenspun Corporation website states, “Palms Casino Resort — The Greenspun Corporation is also a minority partner in the Palms Casino Resort, a 95,000 square foot casino developed by the Maloof Companies where non-stop entertainment can be found. The Palms also opened its new expansion and has introduced Palms Place, a tower currently under construction, which will feature fully furnished condos…”
The firm has also represented Brian Greenspun before various Nevada regulatory bodies relating to his interest in N-M Ventures which does business in the Palms Casino Resort, according to documents.
Another potential conflict is that the law firm’s partner Alfredo Alonso represented Palms as a paid lobbyist before the Nevada Legislature in the 74th (2007), 75th (2009) and 76th (2011) sessions. The California resident’s arbitration was in 2011 and early 2012.
The American Arbitration Association’s Model Standards of Conduct states, “A mediator shall decline a mediation if the mediator cannot conduct it in an impartial manner. Impartiality means freedom from favoritism, bias or prejudice.”
In addressing conflicts of interest, the rules further state, “A mediator shall avoid a conflict of interest or the appearance of a conflict of interest during and after a mediation. A conflict of interest can arise from involvement by a mediator with the subject matter of the dispute or from any relationship between a mediator and any mediation participant, whether past or present, personal or professional, that reasonably raises a question of a mediator’s impartiality.”
The resident has asked the court to overturn Ryan’s ruling as well as the award of attorney fees.
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