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Docs of Ct, LLC v. Biotek Services, LLC

2025-05-28

Summary

Holding. Affirmed. To vacate an arbitration award under Georgia's Arbitration Code based on grounds enumerated in OCGA § 9-9-13(b), the party seeking vacatur must establish actual prejudice by demonstrating that the challenged conduct affected or influenced the outcome of the arbitration, not merely that improper communications occurred.

Docs of CT and Biotek submitted a contract dispute to arbitration. After Docs of CT failed to provide required discovery and its counsel withdrew, the arbitrator prevented Docs of CT from presenting evidence at the damages hearing. The arbitrator then engaged in extensive ex parte communications with Biotek's attorneys—exchanging exhibits, requesting damage calculations, and soliciting feedback on the arbitration outcome—without copying Docs of CT. Docs of CT sought to vacate the arbitration award, citing these improper ex parte communications as evidence of arbitrator misconduct and partiality. The trial court and Court of Appeals both denied the motion to vacate.

The Georgia Supreme Court granted review to establish the standard for determining when ex parte communications constitute grounds for vacating an arbitration award. The court held that to establish prejudice under Georgia's Arbitration Code, a party must demonstrate that the challenged conduct actually affected or influenced the outcome of the arbitration. The court rejected Docs of CT's argument that ex parte communications are inherently prejudicial regardless of their impact on the result. Because Docs of CT failed to show how the ex parte communications specifically influenced the damages award or what different outcome would have resulted from proper procedure, the court found no actionable prejudice.

Summary generated by law.co from the public-domain opinion. The opinion text itself is public domain.

Key issues

  • Standard for establishing prejudice from ex parte communications in arbitration
  • Whether ex parte communications between arbitrator and one party are per se prejudicial or require outcome-focused analysis
  • Burden of proof for vacating arbitration awards under Georgia Arbitration Code

Procedural posture

The Georgia Supreme Court granted review of the Court of Appeals' decision affirming the trial court's denial of a motion to vacate an arbitration award, to establish the proper prejudice standard applicable to ex parte communications in arbitration proceedings.

Authorities cited

Opinion

majority opinion

NOTICE: This opinion is subject to modification resulting from motions for reconsideration under Supreme Court

Rule 27, the Court’s reconsideration, and editorial revisions by the Reporter of Decisions. The version of the

opinion published in the Advance Sheets for the Georgia Reports, designated as the “Final Copy,” will replace any

prior version on the Court’s website and docket. A bound volume of the Georgia Reports will contain the final and

official text of the opinion.

In the Supreme Court of Georgia

Decided: May 28, 2025

S24G0435. DOCS OF CT, LLC v. BIOTEK SERVICES, LLC.

PINSON, Justice.

Georgia’s Arbitration Code sets out a process by which a party

may ask a court to vacate an award granted in arbitration. We

granted review of this case to determine how to assess whether and

when ex parte communications in an arbitration proceeding are

grounds for vacating an arbitral award. Although we asked the parties to address several questions in that regard, we reach in this decision only the standard for assessing whether the rights of the affected party are “prejudiced by” ex parte communications. See

OCGA § 9-9-13 (b). As we explain below, to establish that its rights

were “prejudiced by” one of the listed grounds for vacatur, the party

seeking vacatur of an arbitral award under OCGA § 9-9-13 (b) must

show that the conduct in question — here, certain ex parte communications — affected or influenced the outcome of the arbitration.

Because the party seeking vacatur of the award in this case failed to

make that showing, the Court of Appeals’s decision affirming the

award is affirmed.

1. Background

In April 2018, Docs of CT and Biotek submitted a contract dispute to arbitration. An arbitrator found Docs of CT in default as to

liability, and a hearing was set to determine damages only. Before

that hearing, Docs of CT failed to provide discovery called for in the

scheduling order, and as a consequence, the arbitrator told counsel

for Docs of CT that the company would not be allowed to introduce

evidence at the damages hearing if discovery was not provided. Soon

after, counsel for Docs of CT withdrew from representation. No new

counsel entered an appearance on behalf of Docs of CT, and Docs of

CT never provided the required discovery. After counsel for Docs of

CT withdrew, the arbitrator repeatedly told the company’s representative, Dr. J.D. Sidana, that he would not be allowed to present

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any evidence at the damages hearing both because he was not an

attorney and because Docs of CT was in default.

At the damages hearing, Dr. Sidana was allowed to observe but

not participate, and the arbitrator did not receive evidence from

Docs of CT at the hearing or after it. The arbitrator ultimately

awarded Biotek $447,633.49 in “contract damages,” interest, and attorney’s fees and $1,273,704.48 in “trade secret damages” and attorney’s fees.

Docs of CT moved to vacate the arbitration award in superior

court under OCGA § 9-9-13, asserting (among other things) that the

arbitrator exhibited partiality and engaged in misconduct. 1 In support, Docs of CT submitted to the trial court copies of emails between

1 Docs of CT alleged additional bases for vacatur under OCGA § 9-9-13

(b) in the trial court but we granted review only as to the grounds of misconduct

and partiality. Code section 9-9-13 (b) reads, in relevant part, as follows:

(b) The award shall be vacated on the application of a party who

either participated in the arbitration or was served with a demand

for arbitration if the court finds that the rights of that party were

prejudiced by:

(1) Corruption, fraud, or misconduct in procuring the award;

[or]

(2) Partiality of an arbitrator appointed as a neutral . . . .

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the arbitrator and Biotek’s attorneys that were sent after counsel

for Docs of CT withdrew. Dr. Sidana was not copied on any of the

emails. Docs of CT pointed out that the Rules of Arbitration that the

parties agreed to had prohibited ex parte communications between

a party and the arbitrator, with any “necessary” ex parte communication to be conducted through the arbitration service provider.

The ex parte emails included some that were sent before the

evidentiary hearing, when the arbitrator asked for copies of exhibits

in advance of the hearing and for Biotek to prepare a spreadsheet

for purposes of calculating damages; Biotek responded with the requested exhibits and spreadsheet. Docs of CT also pointed to more

than 25 emails between the arbitrator and counsel for Biotek that

took place after the damages hearing and in which the arbitrator

sought information and feedback from Biotek on the arbitrator’s

damages calculations. Other post-hearing emails included Biotek’s

emailed submission of a post-hearing brief; the arbitrator’s response

thanking Biotek for the brief and stating, “You did a good job”; and

the arbitrator’s request that Biotek’s counsel let him know in what

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court Biotek filed to enforce the award because the arbitrator “assum[ed he would] need that court to help get Docs of CT’s portion of

the arbitration fees paid.”

After a hearing, the trial court denied Docs of CT’s motion and

confirmed the award to Biotek, concluding that the alleged ex parte

communications did not demonstrate misconduct or partiality by the

arbitrator.

The Court of Appeals affirmed. The court explained that the ex

parte emails between the arbitrator and counsel for Biotek “should

not have happened” but that Docs of CT had not established that the

arbitrator was partial. And, assuming that the ex parte emails established misconduct, the Court of Appeals concluded that Docs of

CT had not shown that its rights were prejudiced, see OCGA § 9-9-13 (b), because Docs of CT “failed to articulate resulting prejudice”

and the record showed that the arbitrator “ultimately declined to

award” some of the damages Biotek sought in its post-hearing briefing and emails. Docs of CT v. Biotek Servs., 369 Ga. App. 804, 810-811 (2) (894 SE2d 634) (2023). The court reasoned that Docs of CT

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had not articulated how it was prejudiced by the alleged misconduct,

so the trial court did not clearly err in confirming the award. Id.

Judge Land dissented. He would have concluded that the ex

parte emails were both improper and prejudicial, so the award

should have been vacated. Docs of CT, 369 Ga. App. at 812 (Land,

J., dissenting).

2. Analysis

We granted review in this case to consider how the standards

set out in OCGA § 9-9-13 (b) for vacating an arbitral award apply to

ex parte communications. As it turns out, we need to address only

one of those standards: the one for assessing prejudice.2 Under

OCGA § 9-9-13 (b), even if one of the listed grounds for vacating an

arbitral award is present, the award must be vacated only if the

2 When we granted review, we also asked the parties to address whether

an arbitrator violates any ethical rules by communicating with the representative of a corporate entity that is a party to the arbitration if the representative is not a lawyer. Although we do not reach that question, we note that our decisions have not answered it. We have held only that “[i]n this state, only a licensed attorney is authorized to represent a corporation in a proceeding in a

court of record, including any proceeding that may be transferred to a court of

record from a court not of record.” Eckles v. Atlanta Tech. Group, Inc., 267 Ga.

801, 805 (2) (485 SE2d 22) (1997).

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court finds that “the rights of [the affected] party were prejudiced

by” that ground. That standard is one subject of disagreement between the parties here. Docs of CT contends that ex parte communications during an arbitration proceeding are “per se” prejudicial,

while Biotek argues that the affected party must show how the ex

parte communications actually caused it harm to secure vacatur of

the arbitral award (and that Docs of CT failed to do that). We turn

to this question now.

(a) Prejudice Standard

Start with what it means for the rights of an affected party to

be “prejudiced by” one of the grounds for vacatur. OCGA § 9-9-13 (b).

We determine that meaning by reading the relevant language in its

“most natural and reasonable way” given the “context in which it

appears,” see Chambers v. State, 320 Ga. 770, 772 (1) (911 SE2d 616)

(2025), including the surrounding statutory language, the statute’s

structure and history, and other law that makes up the legal backdrop against which the language was enacted, see State v. Cook, 317

Ga. 659, 660 (1) (893 SE2d 670) (2023). When this “prejudiced by”

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language first entered Georgia’s Arbitration Code in 1978, see Ga.

L. 1978, p. 2278, the verb “prejudice” was used as a general matter

to connote being injured, harmed, or affected detrimentally. See e.g.,

Prejudice, v.t., Webster Deluxe Unabridged Dictionary 1420 (2d ed.

1983) (“to injure or harm, as by some judgment or action; as, his

mistake prejudiced the outcome”); Prejudiced, tr. v., American Heritage Dictionary 1033 (Family ed. 1979) (“To affect injuriously or

detrimentally by some judgment or act”).3 But in legal parlance, the

word “prejudice” carried (and still typically carries) with it a particular sense of harm: a material influence on the outcome of the proceeding in question. This outcome-focused understanding of prejudice shows up in various contexts around the time the term was

added to our Arbitration Code, from Brady violations, see Taylor v.

3 We often look to dictionaries from around the time the relevant legal

text is enacted as a helpful starting point for understanding the meaning of

that text. See State v. SASS Group, LLC, 315 Ga. 893, 898-899 (2) (a) (885

SE2d 761) (2023). But as we have often cautioned, dictionaries “cannot be the

definitive source of ordinary meaning in questions of textual interpretation because they are acontextual, and context is a critical determinant of meaning.”

City of Winder v. Barrow County, 318 Ga. 550, 555 (1) (899 SE2d 157) (2024).

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State, 243 Ga. 222, 222-223 (1) (253 SE2d 191) (1979), and constitutional speedy trial claims, see State v. Madden, 242 Ga. 637, 637

(250 SE2d 484) (1978), to juror-bias claims, see Florence v. State, 243

Ga. 738, 740 (2) (256 SE2d 467) (1979), and claims of ineffective assistance of counsel, see Strickland v. Washington, 466 U.S. 668, 692

(III) (B) (104 SCt 2052, 80 LE2d 674) (1984).

And most notably, this is how federal courts have applied materially similar language in the federal Arbitration Code.4 We have

looked to federal decisions applying the federal Arbitration Code as

important evidence of the meaning of our own Arbitration Code because our Code’s structure and language “closely tracks” the federal

one, which was part of the legal backdrop against which our Code

was enacted. See Brookfield Country Club, Inc. v. St. James4 Compare OCGA § 9-9-13 (b) (1) (“The award shall be vacated on the

application of a party who either participated in the arbitration or was served

with a demand for arbitration if the court finds that the rights of that party

were prejudiced by: (1) Corruption, fraud, or misconduct in procuring the

award.” (emphasis added)), with 9 U.S.C. § 10 (a) (3) (allowing a court to vacate

an arbitration award upon a party’s application “where the arbitrators were

guilty of misconduct in refusing to postpone the hearing, upon sufficient cause

shown, or in refusing to hear evidence pertinent and material to the controversy; or of any other misbehavior by which the rights of any party have been

prejudiced.” (emphasis added)).

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Brookfield, LLC, 287 Ga. 408, 412 (1) (696 SE2d 663) (2010).5 And

federal courts have consistently interpreted the requirement that

the “rights of any party have been prejudiced by” a ground for vacatur to mean that the conduct in question must have affected or influenced the outcome of the arbitration proceeding. See, e.g., Totem

Marine Tug & Barge, Inc. v. N. Am. Towing, Inc., 607 F2d 649, 652-653 (5th Cir. 1979) (party was prejudiced by ex parte communications because the final calculation of damages “hinged on” a figure

provided only during the improper ex parte phone call, which conflicted with other evidence from the hearing); Remmey v. PaineWebber, Inc., 32 F3d 143, 149 (III) (B) (4th Cir. 1994) (“the party seeking

a vacation of an award on the basis of ex parte conduct must demonstrate that the conduct influenced the outcome of the arbitration”

(punctuation omitted) (citing M&A Elec. Power Coop. v. Local Union

No. 702, Int’l Bd. of Elec. Workers, 977 F2d 1235, 1238 (8th Cir.

5 The relevant provision of the Federal Arbitration Code was enacted in

its current form in 1925, see Act of Feb. 12, 1925, ch. 213, § 10, 43 Stat. 885.

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1992), Employers Ins. of Wausau v. Nat’l Union Fire Ins. Co. of Pittsburgh, 933 F2d 1481, 1490-1491 (9th Cir. 1991), and Mutual Fire,

Marine & Inland Ins. Co. v. Norad Reinsurance Co., 868 F2d 52, 57

(3d Cir. 1989), all of which interpret “prejudice” as requiring a showing that ex parte communication or submission of evidence affected

the outcome of the proceeding)).6 These decisions are strong evidence

6 Because OCGA § 9-9-13 (b) parallels 9 U.S.C. § 10, see supra n.5, federal decisions interpreting and applying this language both before and after

our similar language was enacted bear on the meaning of that language today.

Decisions issued before that language was enacted are especially helpful because those decisions interpreting the same language our legislature apparently borrowed were part of the relevant legal backdrop the legislature is presumed to have been aware of when it enacted that language. See Todd v. State,

228 Ga. 746, 750 (187 SE2d 831) (1972) (when the General Assembly enacts a

statute based on a similar statute from another jurisdiction, “the judicial construction already placed upon” the other jurisdiction’s statute “is considered to

accompany [Georgia’s version] and is treated as incorporated therein”). See

also Crum v. Jackson National Life Insurance Co., 315 Ga. 67, 77 (2) (c) (ii)

(880 SE2d 205) (2022) (“we presume that the legislature enacted the new statute ‘with full knowledge of’ the extant body of decisional law”). But even decisions that followed the enactment can be useful to the extent that they offer

persuasive interpretations or applications of the relevant text and the legal

standard embedded within it, so long as the federal language remains consistent with the language enacted into Georgia law. See, e.g. City of Guyton v.

Barrow, 305 Ga. 799, 807 (3) (a), 809-811 (3) (b) (828 SE2d 366) (2019) (reviewing several decades of federal court interpretations of a rule promulgated under the Clean Water Act, as amended in 1987, where the federal law had remained unchanged and the relevant Georgia law was “identical in all material

respects” to its federal counterpart). Cf. Bowden v. The Medical Center, Inc.,

297 Ga. 285, 291 (2) (a) n.5 (773 SE2d 692) (2015) (noting that a Georgia statute at issue was identical to the 1972 version of a federal statute, such that

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that the rights of the affected party are not “prejudiced” as that term

is used in OCGA § 9-9-13 unless the conduct in question affected or

influenced the outcome of the arbitration.

Docs of CT resists this traditional, outcome-focused understanding of prejudice. It contends that the affected party’s “rights

are prejudiced by” conduct that causes “any harm” to the party’s

“right to a fair hearing” (or any other rights implicated) and that the

affected party need not show “how the outcome might have been different.” But Docs of CT offers no relevant authority in support of this

view, and in any event, it does not ultimately help its case. Docs of

CT is not wrong that the affected party’s rights are prejudiced if its

right to a fair hearing is impaired. But the ordinary way to establish

that a party was deprived of a fair proceeding, and that its rights

were therefore “prejudiced,” is to show that the conduct in question

affected or influenced the outcome of the proceeding. See, e.g, Strickland, 466 U.S. at 687 (III), 694 (III) (B) (a criminal defendant proves

federal decisions and commentary from that period are “persuasive authority,”

but that the federal statute had since been substantially revised while the

Georgia statute had not).

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“prejudice” from counsel’s deficient performance by “showing that

counsel’s errors were so serious as to deprive the defendant of a fair

trial, a trial whose result is reliable,” and a defendant does that by

demonstrating “a reasonable probability that, but for counsel’s unprofessional errors, the result of the proceeding would have been different”). So yes, prejudice is, in a basic sense, harm to the affected

party’s rights, including the right to a fair proceeding. But that harm

is ordinarily established by showing an effect or influence on the

outcome of the proceeding. And, we conclude, that is the most reasonable understanding of OCGA § 9-9-13 (b)’s prejudice requirement.

(b) Presumed or Actual Prejudice

As a general rule, when this prejudice standard applies, the

affected party must establish “actual” prejudice by demonstrating

how the conduct in question affected or influenced the outcome of

the proceeding. See, e.g., King v. King, 354 Ga. App. 19, 28 (2) (c)

(840 SE2d 108) (2020) (husband showed he was prejudiced by arbi13

trator’s “imperfect execution of his authority” in a divorce action because the omission of agreed-upon terms in the arbitration award

“severely curtailed” husband’s ability to “review the arbitrator’s decision for error and to seek meaningful (albeit limited) judicial review of the award”); Conmac Corp. v. Southern Diversified Development, Inc., 245 Ga. App. 895, 898 (1) (c) (539 SE2d 532) (2000) (party

demonstrated prejudice from modification of arbitration award

where the modified award subjected the party to liability on a bond

“where no such liability existed under the original award”); Sweatt

v. International Development Corp., 242 Ga. App. 753, 755 (1) (531

SE2d 192) (2000) (parties established they were prejudiced by “[a]n

overstepping by the arbitrators of their authority” where the arbitrator awarded actual damages in violation of the terms of the underlying contract between the parties, which permitted only the recovery of liquidated damages); Totem Marine Tug & Barge, Inc., 607

F2d at 652-653 (party showed prejudice from arbitrators’ misconduct where the final damages amount owed by it “hinged on” improperly obtained ex parte evidence). By contrast, prejudice is “per

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se” or “presumed” — meaning that the affected party need not

demonstrate how the outcome was likely affected — only as a rare

exception in certain contexts, like claims of actual or constructive

denial of (or state interference with) the assistance of counsel, see

Strickland, 466 U.S. at 692 (III) (B) (citing United States v. Cronic,

466 U.S. 648, 659 (III) & n.25 (104 SCt 2039, 80 LE2d 657) (1984)).

This rare exception has been applied when there is some reason specific to those contexts for dispensing with the need to prove prejudice

on a case-by-case basis and is largely confined to certain constitutional rights of criminal defendants. See, e.g., Strickland, 466 U.S.

at 692 (explaining that prejudice is presumed in cases of actual or

constructive denial of the assistance of counsel or state inference

with counsel’s assistance because “[p]rejudice in these circumstances is so likely that case-by-case inquiry into prejudice is not

worth the cost”).

This case presents no basis for departing from the general rule.

Docs of CT offers no particular reason that an affected party could

not or need not show how the outcome of a proceeding was affected

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or influenced by ex parte communications to establish prejudice in

any given case. And although our Court has not had occasion to address a claim seeking vacatur of an arbitral award because of ex

parte communications, federal courts that have addressed such

claims — both around the time we adopted the federal Code’s prejudice language and after — have consistently required the affected

party to prove prejudice from such conduct by showing how the ex

parte communications affected or influenced the outcome of the proceeding. See Totem Marine Tug & Barge, Inc., 607 F2d at 652-653

(party established prejudice from ex parte phone call where arbitrators obtained the figure that the final award “hinged on”); Mutual

Fire, Marine & Inland Ins. Co., 868 F2d at 57 (“mere assertion” that

the arbitrators “used” the improperly obtained ex parte information

to render their decision and assess a witnesses’ credibility was not

enough to show the challenger was prejudiced by the misconduct);

Employers Ins. of Wausau, 933 F2d at 1490 (party “failed to demonstrate that any prejudice resulted from the ex parte contacts”); M&A

Elec. Power Coop., 977 F2d at 1238 (“party seeking a vacation of an

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award on the basis of ex parte conduct must demonstrate that the

conduct influenced the outcome of the arbitration”); Remmey, 32 F3d

at 149 (III) (B) (assuming arbitrator’s alleged ex parte comments

about seating arrangements were improper, appellant failed to show

how the remarks influenced the outcome of the arbitration). We conclude that OCGA § 9-9-13 requires the same: the party seeking vacatur of an arbitration award under OCGA § 9-9-13 (b) must establish that its rights were “prejudiced by” one of the listed grounds for

vacatur by showing that the conduct in question affected or influenced the outcome of the arbitration.

(c) Application

Under the proper standard for assessing prejudice, Docs of CT

has not established that its rights were prejudiced by the ex parte

communications in this case. Even assuming those communications

amounted to misconduct or some other ground for vacatur under

OCGA § 9-9-13 (b), Docs of CT offers no basis in the record or otherwise for concluding that they affected or influenced the outcome of

the arbitration proceedings. Instead, Docs of CT points to the ex

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parte emails about exhibits and damages calculations without explaining how it was prejudiced by the ex parte nature of these communications. As just a few examples, it does not show what evidence

it would have presented in support of a lower damage award; what

objections it could have made or defenses it could have raised to Biotek’s exhibits or the arbitrator’s damages calculations before, during, or after the hearing that would have altered the final result;

what testimony it might have elicited on cross-examination that

would have led to a different result; what arguments it would have

made in post-hearing briefing to rebut Biotek’s damages calculations; or anything else that would tend to show that, but for the ex

parte nature of the communications at issue here, the outcome of the

arbitration, i.e., the amount of damages awarded to Biotek, likely

would have been different.7 Absent any such showing, Docs of CT

7 Docs of CT suggests that it could not establish prejudice because it was

prohibited from offering any evidence at the hearing in the trial court on its

motion to vacate, relying on our decision in Greene v. Hundley, 266 Ga. 592

(468 SE2d 350) (1996). It is mistaken. In Greene, we held that a trial court can

vacate an arbitration award only on a finding that one of the grounds enumerated in OCGA § 9-9-13 (b) is present. 266 Ga. at 595-596 (3). To that end, we

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has failed to establish that its rights were prejudiced by ex parte

communications in the arbitration proceeding.

Judgment affirmed. Peterson, CJ, Warren, PJ, and Bethel,

Ellington, McMillian, LaGrua, and Colvin, JJ, concur.

held that the “prohibition against considering the sufficiency of the evidence

as grounds for vacating an arbitration award is unconditional” and “a reviewing court is prohibited from weighing the evidence submitted before the arbitrator, regardless of whether the court believes there to be sufficient evidence,

or even any evidence, to support the award.” Id. at 596-597 (3) (emphases

added). In other words, we said that neither a trial court nor an appellate court

can independently weigh the sufficiency of the evidence to support the award

because a lack of sufficient evidence is not one of the enumerated grounds on

which an arbitration award can be vacated. We said nothing in Greene, or any

other decision, about what evidence a party can present to a trial court in support of showing that at least one of the enumerated grounds for vacatur exists

and that the party was prejudiced by that ground. To be clear, because the

burden is on the party seeking vacatur to prove its “rights . . . were prejudiced

by” one of the enumerated grounds, OCGA § 9-9-13 (b), it would be prudent for

that party to present any and all arguments and evidence it can muster to show

how the outcome of the proceeding was affected by the conduct that the party

contends fell within one of the statutory grounds for vacating the award. Here,

Docs of CT provided proof of the emails that it claims were misconduct but

failed to offer any evidence that showed it was prejudiced by the emails, as we

have explained above.

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