## Facts

- Beverly Bien and David Wellman invested through Mid Atlantic Capital Corporation, a brokerage firm and FINRA member, and suffered significant losses.
- Bien and Wellman filed a FINRA arbitration alleging their accounts were placed in unsuitable, excessively risky investments.
- At the arbitration hearing, their expert presented two alternative damages measures: (1) net out-of-pocket losses and (2) market-adjusted damages based on a suitable benchmark portfolio.
- Bien and Wellman requested market-adjusted damages; the two measures were presented as alternatives rather than additive components.
- The arbitration panel awarded (1) “initial-investment damages” of $292,411 and (2) “compensatory damages” of $484,683, plus fees, costs, and interest.
- Mid Atlantic asserted the award reflected a double recovery because the first amount matched the expert’s net out-of-pocket figure and the second closely matched the market-adjusted figure.

## Issues

1. Whether an alleged double recovery in an arbitration award constitutes an “evident material miscalculation of figures” permitting modification under 9 U.S.C. § 11(a).
2. Whether a § 11(a) miscalculation must be evident from the face of the award, or may be established by examining the arbitration record.
3. Whether the alleged error justified vacatur under 9 U.S.C. § 10(a)(4) as an excess of arbitral powers.

## Decision

- The Tenth Circuit affirmed the district court’s confirmation of the FINRA award.
- The court held § 11(a) did not authorize modification because the asserted miscalculation was not evident from the award’s face and could be identified only by comparing the award to the arbitration record and expert damages models.
- The court rejected vacatur under § 10(a)(4), concluding the panel acted within the scope of its authority to award damages.

## Legal Principles

- Judicial review of arbitration awards under the FAA is extremely limited; courts may modify or vacate only on the statute’s specified grounds.
- Under 9 U.S.C. § 11(a), an “evident material miscalculation of figures” must be apparent from the face of the award itself; courts may not use extrinsic evidence to reconstruct how arbitrators derived damages.
- Section 11(a) targets clerical or computational errors visible in the award, not alleged substantive errors such as selecting or combining damages theories.
- Even if an award appears to provide a windfall or double recovery, that does not, without more, establish that arbitrators exceeded their powers under 9 U.S.C. § 10(a)(4).

## Conclusion

The court held that an alleged double recovery in a FINRA award was not correctable under FAA § 11(a) because the claimed miscalculation was not evident from the award’s text, and it refused to treat the asserted damages error as a basis for vacatur under the FAA’s narrowly defined review standards.


Mid Atl. Cap. Corp. v. Bien, 956 F.3d 1182 (10th Cir. 2020)