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Arbitration Is Compelled Even Though The Designated Forum Is Non-Existent

New-Development-IconBy Howard S. Suskin

A district court granted defendant’s motion to compel arbitration even though the arbitration forum specified in the parties’ arbitration agreement does not exist.  PR Group, LLC Windmill International LTD., No. 14-0401-CV-W-BP (W.D. Mo. Feb. 1, 2016).   The court concluded that the failure to properly specify an arbitration forum does not render the agreement to arbitrate ineffective.  Section 5 of the Federal Arbitration Act, which permits the court to designate an arbitrator when there is a lapse in the parties’ agreement for naming an arbitrator, applies when the arbitration forum ceases to exist as well as when one has not been designated.  Accordingly, the court exercised its power to direct that arbitration be conducted by the American Arbitration Association.