## Facts

- Hall Street Associates, L.L.C. owned a former factory property in Oregon and leased it to Mattel, Inc.
- The lease included an indemnification provision requiring Mattel to cover certain environmental cleanup costs tied to noncompliance with environmental laws.
- Environmental testing revealed significant contamination, leading to a dispute over responsibility for cleanup and Mattel’s right to terminate the lease.
- Hall Street sued Mattel in federal court; after a bench trial, the district court held Mattel could terminate the lease, and the parties agreed to arbitrate the remaining indemnification dispute.
- The arbitration agreement, approved and entered as a district court order, required the court to vacate, modify, or correct an award if the arbitrator’s legal conclusions were erroneous.
- The arbitrator first ruled for Mattel; the district court vacated the award under the contract’s legal-error review clause.
- On remand, the arbitrator ruled largely for Hall Street; the district court mostly confirmed the second award, again applying the contract’s expanded review standard.
- The Ninth Circuit reversed, holding that FAA §§ 10 and 11 supply exclusive grounds for vacatur and modification and that contractual expansion of judicial review is unenforceable under the FAA.

## Issues

1. Whether parties may, by contract, expand judicial review of arbitration awards beyond the vacatur and modification grounds enumerated in FAA §§ 10 and 11 while proceeding under the FAA’s confirmation/vacatur/modification framework.
2. Whether a federal court applying FAA §§ 9–11 may vacate or modify an award for ordinary legal error when the parties’ arbitration agreement calls for that review.

## Decision

- The Supreme Court affirmed the Ninth Circuit and remanded.
- FAA §§ 10 and 11 provide the exclusive grounds for vacatur and modification when a party seeks relief under the FAA’s expedited review scheme.
- Parties may not require a federal court, acting under the FAA, to review an arbitral award for legal error or other nonstatutory bases through a contractual clause.

## Legal Principles

- Under FAA § 9, a court must confirm an award unless it is vacated, modified, or corrected as prescribed in FAA §§ 10 and 11.
- FAA §§ 10 and 11 enumerate limited, exclusive grounds for vacatur and modification; courts may not add contract-made grounds when applying the FAA.
- Contractual provisions demanding merits review for legal error are unenforceable within the FAA confirmation/vacatur/modification framework.
- References to “manifest disregard” cannot justify nonstatutory expansion of review; at most, such language may be treated as shorthand consistent with § 10, not an additional basis for vacatur.
- The FAA is not necessarily the sole route to court involvement with arbitral awards, but once parties invoke FAA §§ 9–11, the statute’s limits control.

## Conclusion

The Court held that FAA §§ 10 and 11 are the exclusive bases for vacating or modifying arbitration awards under the FAA, rejecting contractual attempts to require judicial review for legal error and reinforcing the narrow scope of court intervention in arbitration.


Hall Street Assocs., L.L.C. v. Mattel, Inc., 552 U.S. 576 (2008)