## Facts

- Meadows Indemnity Co., an insurer, alleged that participants and managers of a casualty insurance/reinsurance pool obtained excessive commissions and concealed information to increase profits.
- Related federal litigation was stayed while Meadows’ claims against certain insurer defendants proceeded in arbitration under pool agreement arbitration clauses.
- Baccala & Shoop Insurance Services (the pool manager) and its corporate successor/custodian, Willis Corroon, were not parties to the arbitration agreement but held many relevant pool records.
- For use in the arbitration, the arbitral panel issued a subpoena under the Federal Arbitration Act (FAA) directing Willis Corroon/BSIS to produce a large volume of documents in Nashville for review and copying.
- Willis Corroon moved in the Middle District of Tennessee for a protective order and to quash or limit the arbitral subpoena, arguing the panel lacked authority to compel prehearing document production from a nonparty and that the subpoena was overly broad and unduly burdensome.

## Issues

1. Whether FAA § 7 authorizes arbitrators to compel a nonparty to produce documents for prehearing discovery when the nonparty is not simultaneously required to appear before the arbitrators.
2. Whether the subpoena’s breadth and the proposed production arrangement imposed an undue burden on the nonparty warranting quashal or significant limitation.

## Decision

- The court upheld the arbitrators’ authority under FAA § 7 to subpoena a nonparty for production of documents in aid of the arbitration.
- The court declined to issue a broad protective order quashing the subpoena.
- The court indicated that burden concerns should be addressed through tailored limitations and practical management measures rather than categorical denial of access to core evidence.

## Legal Principles

- FAA § 7 permits arbitrators to summon persons and, in a proper case, require them to bring records deemed material as evidence; courts may enforce such arbitral summonses.
- Section 7 may be interpreted to allow reasonable, prehearing nonparty document production arrangements tied to the arbitrators’ authority to receive evidence, rather than restricting production solely to in-hearing delivery before the panel.
- Even when an arbitral subpoena is authorized, a court may modify or limit it to prevent unreasonable or oppressive burden, especially for nonparties.
- A nonparty’s close connection to the underlying transaction and possession of central records weighs against quashal where the requested documents are material to the arbitration.

## Conclusion

The court enforced an arbitral subpoena for documents held by a nonparty closely connected to the dispute, holding that FAA § 7 supports compelled production in aid of arbitration and that burden objections generally justify tailored limits, not wholesale quashal, absent a showing of unreasonable or oppressive demands.


Meadows Indem. Co. v. Nutmeg Ins. Co., 157 F.R.D. 42 (M.D. Tenn. 1994)