What Jay-Z Wants, Finra Insists It Already Has
February 12, 2019 by Rita Raagas De Ramos
An ongoing dispute involving rapper and entrepreneur Jay-Z and a brand management company that’s set to be heard before the American Arbitration Association has pointed the spotlight on how critical it is to have arbitrator diversity.
In November Jay-Z asked the Supreme Court of the State of New York – in a filing under his legal name, Shawn Carter – to halt arbitration proceedings initiated by Iconix Brand Group over a trademark and contract dispute against him because there were not enough eligible African-American arbitrators to hear the case. Jay-Z was “confronted with a stark reality” involving the AAA’s “blatant failure” to ensure diversity, especially given the “prevalence of mandatory arbitration provisions in commercial contracts across nearly all industries,” according to the petition.
On January 30, the Supreme Court of the State of New York ordered the respondents to show cause why the arbitration shouldn’t be halted. But later, on January 30, Jay-Z’s lawyer – Alex Spiro, a partner at Quinn Emanuel Urquhart & Sullivan – told the court the AAA has allowed the dispute to be heard by a three-arbitrator panel instead of a single arbitrator, and offered five African-American candidates. That concession was enough for Jay-Z’s legal team to proceed with the arbitration.
Arbitrator diversity is an issue that Finra’s Office of Dispute Resolution – which administers the self-regulator’s independent arbitration and mediation forum – has been dealing with for several years.