NASD Issues Guidance to Arbitrators on Legal Issues, Opinion Writing, and Discovery Sanctions

"As you all know, in arbitration, arbitrators are not strictly bound by legal precedent. However, they should be guided in their analysis by the underlying policies of the law. They are given wide latitude in their interpretation of legal concepts. If the parties provide the panel with the law and the law is clear and applicable to the facts of the case, in those situations you should follow the law as presented by the parties. In certain jurisdictions, manifest disregard of the law is a basis for courts to vacate or set aside a panel’s award."