The opinion of the court was delivered by: COTE
DENISE COTE, District Judge:
Plaintiff Alicia DeGaetano ("DeGaetano") moves to modify or correct an arbitration award rendered in her favor in an employment discrimination case, seeking specifically to collect attorney's fees that she was denied in that award. DeGaetano contends that because she received an award of $ 90,355 in the arbitration, thereby attaining "prevailing plaintiff" status, the arbitrator's failure to grant her attorney's fees constituted a manifest disregard of the law under Title VII of the Civil Rights Act of 1964 ("Title VII"), 42 U.S.C. § 2000e et seq. For the reasons stated below, DeGaetano's motion is granted.
DeGaetano commenced this action on March 8, 1995, alleging violations of Title VII, the New York State Human Rights Law ("HRL"), New York State Executive Law § 296 et seq., and the Administrative Code of the City of New York § 8-107 et seq., against her former employer, Smith Barney Shearson, Inc. ("Smith Barney"), and her former supervisor at Smith Barney, Frederick Hessler ("Hessler"); DeGaetano also brought a claim against Hessler alone under the common law of New York for intentional infliction of emotional distress. In brief, DeGaetano alleged that she had been forced to resign her employment at Smith Barney due to unwelcome sexual advances made toward her by Hessler, and due to Smith Barney's refusal to take any action in response to her complaints about Hessler.
On February 5, 1996, this Court issued an Opinion and Order ("Order"), familiarity with which is assumed, granting the defendants' motion to compel arbitration of DeGaetano's claims; in so doing, the Court enforced the arbitration clause of an agreement entitled "Principles of Employment" that DeGaetano had signed upon joining Smith Barney in July 1993. That agreement, and specifically the arbitration clause, incorporated by reference Smith Barney's "Arbitration Policy," which at the time of DeGaetano's hiring provided in relevant part:
Arbitration under the Policy shall be conducted pursuant to the arbitration rules of the NYSE [New York Stock Exchange] in effect at the time of the arbitration except as modified by this . . . Arbitration Policy. The rules in effect as of September 1, 1992 are attached hereto. In addition to the NYSE Rules, the following provisions shall apply. . . . Each side shall pay its own legal fees and expenses.
(Emphasis added.) The Principles of Employment contract advised DeGaetano that the Arbitration Policy and other key documents:
During the course of the ensuing arbitration, before an Arbitration Panel under the auspices of the New York Stock Exchange, Inc., DeGaetano formally applied for recovery of her attorney's fees. In support of the application, DeGaetano filed a memorandum of law informing the Arbitration Panel of the requirement that prevailing parties be awarded attorney's fees under Section 2000e-5(k) of Title VII, 42 U.S.C. § 2000e-5(k).
Citing that statute as well as Cowan v. Prudential Ins. Co. of America, 935 F.2d 522, 523-24 (2d Cir. 1991), the memorandum stated: "If DeGaetano establishes her claim of sex discrimination, the Panel must award her attorneys' fees and costs." (Emphasis added.) In arguing that Smith Barney's Arbitration Policy was void to the extent that it purported to preclude recovery of attorney's fees, DeGaetano's memorandum further apprised the Arbitration Panel of the Supreme Court's "holding that . . . prevailing claimants [are] entitled to receive full attorneys' fees even though their recovery was very modest and substantially less that [sic] the attorneys' fees." (Emphasis added.) As additional support for the fee claim, the memorandum asserted with reference to Section 2000e-5(g)(2)(B) of Title VII that:
underlining the importance of vindicating the public policy of eradicating discrimination, the Civil Rights Act provides for attorneys' fees if the claimant proves that a discriminatory motive played a part in the decision even if the defendant proves that it would have taken the same action absent the discriminatory motive.
The defendants' submission to the Arbitration Panel also conveyed that "a prevailing plaintiff is entitled to costs under Title VII," although, according to the defendants, "the court has discretion as to the amount of fees allowed." The defendants' primary argument, however, was that the Arbitration Panel had no authority to award attorney's fees in the first instance, because DeGaetano's employment agreements (incorporating the Smith Barney Arbitration Policy) expressly precluded such an award.
On March 18, 1997, following ten days of hearings, the Arbitration Panel rendered its decision, which states in its entirety:
Respondents shall pay to Claimant $ 90,355 in damages and interest. This award is joint and several. The Panel does not find that the conduct of Respondents rose to the level contemplated by Title VII and therefore deny the requests for punitive damages and attorney's fees. Unpaid forum fees of $ 10,800 are assessed against Respondent Smith Barney.
(Emphasis added.) DeGaetano filed the present motion on June 16, 1997, seeking attorney's fees and costs, or in the alternative, an order modifying or correcting the Panel's decision to provide for such an award.
The party seeking to vacate or modify an arbitration award bears the burden of proof, and the showing required of that party in order to avoid summary affirmance of the award is high. Willemijn Houdstermaatschappij, BV v. Standard Microsystems Corp., 103 F.3d 9, 12 (2d Cir. 1997). Although this Court may vacate an award "when the arbitrator acted in manifest disregard of the law," id., "the reach of the manifest disregard doctrine is 'severely limited.'" DiRussa v. Dean Witter Reynolds Inc., 121 F.3d 818, 821 (2d Cir. 1997) (quoting Government of India v. Cargill Inc., 867 F.2d 130, 133 (2d Cir. 1989)). "A district court should not vacate an arbitration award for manifest disregard simply because of 'error or misunderstanding with respect to the law.'" International Telepassport Corp. v. USFI, Inc., 89 F.3d 82, 85 (2d Cir. 1996) (quoting Merrill Lynch, Pierce, Fenner & Smith, Inc. v. Bobker, 808 F.2d 930, 933 (2d Cir. 1986)). Rather, the term "manifest disregard 'clearly means more'":
The error must have been obvious and capable of being readily and instantly perceived by the average person qualified to serve as an arbitrator. Moreover, the term "disregard" implies that the arbitrator appreciates the existence of a clearly governing legal principle but decides to ignore or pay no attention to it.
DiRussa, 121 F.3d at 821 (quoting Bobker, 808 F.2d 930 at 933). Thus, in order to modify or vacate an award on the ground of manifest disregard, this Court "must find both that (1) the arbitrator knew of a governing legal principle yet refused to apply it or ignored it altogether, and (2) the law ignored by the arbitrator . . . [was] well defined, explicit, and clearly ...