This article was featured in Jus Mundi‘s 2024 Arbitration Year in Review, in collaboration with VYAPs, a yearly collection of articles from jurisdictions all around the globe updating you on arbitration-related developments from the previous year.
THE AUTHORS:
Clémence Prévot, Director of Publications at Jus Mundi
Giulia Bartoletti, Legal Publications Officer at Jus Mundi
In 2024, arbitration in the United States underwent significant transformations, shaped by AI regulations, landmark investment disputes, and evolving judicial oversight. This article explores these developments, examining how they redefine arbitration’s role in a rapidly changing legal landscape.
Shaping the Future of Arbitration: AI’s Growing Role and Emerging Regulations
The SVAMC Guidelines: A Framework for AI in Arbitration
On April 30, 2024, the Silicon Valley Arbitration and Mediation Center (“SVAMC”) introduced its Guidelines on the Use of Artificial Intelligence in Arbitration (2024). These guidelines aim to enhance transparency, uphold impartiality, and reinforce the need for human oversight, addressing AI’s growing influence in legal research and drafting, case management, and evidence analysis. The Guidelines also aim to standardize ethical AI practices across commercial, investment, and sports arbitration, aligning with the global push for AI regulation in legal proceedings.
A key element of the Guidelines is their three-part structure, outlining responsibilities for:
- All participants in the arbitration proceedings, who must ensure that the use of AI in their arbitration proceedings complies with ethical standard;
- Parties and legal representatives, who are required to disclose, on a case-by-case basis, AI tools used in case preparation;
- Arbitrators, who are explicitly prohibited from delegating decision-making authority to AI.
By taking a proactive and adaptable approach, the SVAMC Guidelines serve as a bridge between technological advancements and arbitration’s core principles, reinforcing party autonomy while mitigating risks.
As regulation of AI continues to evolve, the Guidelines provide a versatile framework that supports both domestic regulatory development and international arbitration trends.
Domestically, the SVAMC Guidelines provide a framework which can complement emerging state-level AI regulations. California’s 2024 AI accountability laws are one such example, which mandate disclosure of AI tools used in legal proceedings. The debate persists as the arbitral community seeks to strike the right balance between AI transparency and the confidentiality of arbitration proceedings.
Internationally, the Guidelines opt for a more flexible, principle-based approach, that contrasts with more rigid, restrictive frameworks, such as the EU AI Act.
While SVAMC’s guidance is not legally binding, it is, however, expected to influence arbitral institutions such as AAA and ICC, reinforcing the U.S.’s position as a leader in AI-driven arbitration.
AI Regulation in Arbitration: Diverging Approaches in the U.S. and EU
The rapid rise of AI-powered legal tools has driven the United States and the European Union (EU) down starkly different regulatory approaches, reflecting their respective priorities regarding risk mitigation and technological innovation.
The U.S.: A Fragmented and Deregulatory Approach
In an unexpected turn, California failed to pass the Safe and Secure Innovation for Frontier Artificial Intelligence Models Act (SB 1047) in 2024. California’s Governor, Gavin Newsom, vetoed the bill on September 29, 2024, preventing what would have been the first substantial AI-specific legislation in the U.S. The proposed bill would have enforced third-party audits along with a “kill switch” system and enhanced privacy expectations for developers, sparking debate between AI safety advocates and industry leaders.
This shift signals a more fragmented regulatory environment. The veto of the bill maintained the status quo, allowing AI to be used in arbitration and legal proceedings without mandatory disclosure or oversight. The absence of federal AI regulations means state-by-state approaches could create inconsistencies, particularly for cross-border disputes.
The regulatory shift deepened in 2025 when President Donald Trump, upon returning to office, swiftly revoked the AI executive order issued by his predecessor, President Biden. Biden’s AI policy aimed to ensure secure and responsible AI development by enforcing cybersecurity, transparency, and ethical standards, with government oversight over AI deployment.
However, under Executive Order 14179, “Removing Barriers to American Leadership in Artificial Intelligence”, Trump’s administration reversed course entirely:
- Eliminating government-mandated ethical and transparency requirements;
- Dismantling oversight mechanisms for AI systems, leaving regulation largely to the private sector;
- Prioritizing U.S. dominance in the global AI race, with a focus on innovation over-regulation.
This policy shift has major implications for arbitration. While it could accelerate AI adoption in legal proceedings, the absence of regulatory safeguards raises concerns over bias, confidentiality, and fairness in AI-assisted arbitration.
The EU: A Risk-Based AI Governance Model & its Impact on U.S.-Seated Arbitrations
In contrast, the EU has taken a diametrically opposite approach, embracing rigorous oversight to mitigate AI-related risks while encouraging responsible innovation. The EU AI Act, which took effect on August 1, 2024, introduced comprehensive AI regulations, including strict risk-based categorization of AI applications, applicable to legal and arbitration settings.
Although its direct impact on U.S.-seated arbitrations remains unclear, experts predict that multinational parties and tribunals applying EU law may demand AI compliance, influencing best practices in international arbitration.
Some arbitral institutions, including the ICC, may align more closely with EU standards, given their significant EU caseload.
With the U.S. deregulating AI and the EU imposing stricter controls, arbitration practitioners, especially those handling cross-border disputes, must navigate an increasingly complex regulatory environment, balancing innovation with compliance expectations.
Investment Arbitration in the U.S.: NAFTA’s Final Chapter and ICSID Enforcement Battles
NAFTA Legacy Cases: The Closing Chapter on Investor-State Disputes
Although the Agreement between the United States of America, the United Mexican States, and Canada (2018) (“USMCA”) replaced the North American Free Trade Agreement (“NAFTA”) in 2020, NAFTA Chapter 11 legacy claims continued to shape U.S. investment arbitration in 2024. Under NAFTA’s sunset clause, investors could file claims against governments for pre-termination disputes until July 1, 2023, which resulted in high-profile investor-State cases still unfolding in 2024.
Among the most consequential disputes was TC Energy and TransCanada Pipelines v. USA, where a $15 billion claim challenging the Biden administration’s cancellation of the Keystone XL pipeline was dismissed on July 12, 2024. The arbitral tribunal rejected the claims, ruling that the pipeline permit did not constitute an investment guarantee and that the U.S. government acted within its sovereign regulatory rights.
This ruling reinforced a narrowing interpretation of NAFTA investor protections, particularly regarding regulatory actions in environmental and energy policy. Legal experts observed the decision as evidence of an increasing preference for State autonomy in climate change disputes. While TC Energy may still seek annulment, the ruling aligns with USMCA’s more restrictive Investor-State Dispute Settlement (“ISDS”) framework, which significantly limits future investor claims to expropriation and discrimination cases.
This changing context gives rise to questions regarding the continued effectiveness of arbitration as a tool for investor protection.
ICSID Award Enforcement: U.S. Courts Weigh Sovereign Immunity & Investor Rights
In 2024, U.S. courts further clarified the parameters for enforcement of International Centre for Settlement of Investment Disputes (“ICSID”) awards. They effectively balanced considerations of sovereign immunity with the need for meaningful judicial discovery and arbitration enforcement under the Foreign Sovereign Immunities Act (“FSIA”).
While U.S. courts restricted procedural tools like discovery, they upheld the enforceability of ICSID awards, reinforcing the United States’ role as a key jurisdiction for award enforcement.
Webuild v. Panama (Second Circuit, July 19, 2024): Restricting U.S. Discovery in Investor-State Arbitration
The court upheld a lower court decision barring discovery under 28 U.S.C. § 1782 for use in ICSID arbitration. Webuild had sought discovery from WSP USA to support its arbitration claim against Panama, initially securing approval from the district court. However, following the Supreme Court’s Luxshare v. ZF Automotive ruling, J une 13, 2022, which narrowed § 1782 applicability to tribunals exercising governmental or intergovernmental authority, the district court vacated its prior ruling.
The Second Circuit affirmed this decision, ruling that ICSID tribunals do not qualify as governmental or intergovernmental bodies, thereby excluding them from § 1782 discovery access.
This decision aligns with the broader trend of restricting U.S. discovery tools in international arbitration, particularly in investor-State cases, forcing claimants to rely on arbitration-specific procedural rules rather than U.S. court mechanisms.
NextEra v. Spain (D.C. Circuit, August 16, 2024): FSIA Arbitration Exception and Intra-EU Enforcement
The court affirmed jurisdiction under the FSIA’s arbitration exception to enforce a €290 million Energy Charter Treaty (1994) (“ECT”) award against Spain. Spain invoked sovereign immunity, arguing that EU law prohibits the enforcement of intra-EU arbitration awards, a defense rooted in the Achmea doctrine. However, the court rejected Spain’s argument, reaffirming that the FSIA arbitration exception applies when a foreign State has consented to arbitration under an international treaty.
However, the court remanded the case for further consideration regarding whether the pending ICSID annulment proceedings justified a stay of enforcement.
The D.C. Circuit’s decision follows a broader U.S. trend favoring enforcement of intra-EU investor-State awards, even as European courts adopt a more restrictive approach forcing investors to navigate increasing procedural obstacles in European jurisdictions.
Zhongshan Fucheng v. Nigeria (D.C. Circuit, August 9, 2024): Sovereign Immunity Showdown in $70M ICSID Award Battle
On November 7, 2024, Nigeria appealed to the U.S. Supreme Court, seeking to limit the scope of the FSIA’s arbitration exception in enforcing a $70 million ICSID award. Nigeria argues that it should be more narrowly interpreted, potentially restricting investors’ ability to enforce ICSID awards against sovereign States in the U.S.
The case, pending before the Supreme Court in early 2025, raises critical questions regarding the boundaries of sovereign immunity and investor rights under the FSIA.
A Supreme Court ruling in Nigeria’s favor could curtail investor recourse against sovereigns, while an adverse decision would reinforce U.S. courts as a key forum for arbitration enforcement. The case marks Nigeria’s boldest sovereign immunity defense yet and could reshape global arbitration enforcement standards.
Commercial Arbitration: Judicial Oversight and Key FAA Decisions
Judicial interpretation of the Federal Arbitration Act in 2024 established essential limits between arbitration enforcement and court oversight. The U.S. Supreme Court’s unanimous ruling in Smith v. Spizzirri clarified that FAA Section 3 requires courts to hold cases in abeyance rather than terminate them when arbitration becomes mandatory.
The landscape of commercial arbitration continued to evolve with major disputes such as Walgreens v. Express Scripts and Crescent v. Iran challenging courts to determine the enforceability of awards in complex, high-value matters. These cases tested judges’ willingness to accept arbitration awards in billion-dollar disputes. The U.S. legal system currently navigates a fine line between maintaining arbitration’s self-governance and necessary judicial involvement.
FAA in Focus: Smith v. Spizzirri (U.S. Supreme Court, May 16, 2024) and the Stay Requirement
On May 16, 2024, the U.S. Supreme Court resolved a longstanding circuit split by ruling in this case that district courts must stay proceedings rather than dismiss them when compelling arbitration under Section 3 of the FAA. Courts therefore remain involved for potential post-award review.
Justice Sotomayor, writing for a unanimous Court, emphasized that staying the proceedings aligns with the FAA’s purpose of facilitating arbitration while preserving judicial oversight. The ruling addressed concerns over statute-of-limitations risks, ensuring that parties retain judicial recourse if an arbitration award requires confirmation or vacatur.
This decision strengthens the FAA’s framework, affirming that arbitration is not a judicial escape route but a supervised process.
PWNHealth d/b/a Everly Health Solutions v. Walgreen (Arbitral Tribunal, March 1, 2024): Challenging Arbitrator Bias
One of the largest domestic commercial arbitration awards of 2024, the case centered on a nearly $1 billion arbitration ruling under the Lanham Act, ruling that Walgreens improperly used PWN’s branding. Walgreens contested the award, citing a liability cap and the arbitrator’s undisclosed personal connection to the opioid crisis, but the court found no evidence of bias or legal missteps.
This case reaffirmed that judicial review of arbitral awards remains limited, with courts generally deferring to arbitration decisions unless clear evidence of bias or misconduct exists.
Crescent v. NIOC (I) (District Court D.C. Circuit, April 30, 2024): Enforcing a $2.4 Billion Gas Arbitration Award
The dispute arose from a gas supply agreement between Crescent Petroleum and the National Iranian Oil Company (“NIOC”). Iran argued sovereign immunity, while Crescent sought enforcement of the $2.4 billion arbitration award under the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards (1958) (“New York Convention”). The U.S. District Court for the District of Columbia sided with Crescent, reaffirming the U.S.’s commitment to enforcing international arbitration awards despite sovereign objections.
The FAA’s stability was reinforced in 2024, with Smith v. Spizzirri ensuring continued judicial oversight of arbitration cases and Walgreens and Crescent reaffirming the strong pro-enforcement stance of U.S. courts. These rulings further solidify the United States’ credibility as a leading jurisdiction for arbitration enforcement.
From the Paris Olympics to the NCAA: The Shifting Landscape of U.S. Sports Arbitration
The Jordan Chiles Case: A CAS Ruling Under Fire
The sports world in the United States gained unprecedented interest in arbitration in 2024 due to major Olympic disputes, combined with National Collegiate Athletic Association (NCAA) litigation.
The most talked-about U.S. sports arbitration case of 2024 was Jordan Chiles’ appeal of a CAS ruling in RGF & Ana Bărbosu v. FIG & Donatella Sacchi / RGF & Sabrina Maneca-Voinea v. FIG & Donatella Sacchi that stripped her of an Olympic bronze medal in women’s artistic gymnastics at the Paris Olympics. On August 10, 2024, the Court of Arbitration for Sport (“CAS”) upheld a challenge from Romania’s Ana Barbosu, reallocating Chiles’ medal due to an alleged scoring miscalculation.
The decision sparked outrage in the U.S. sports community, with Chiles’ legal team alleging bias by arbitrator Hamid Gharavi and procedural irregularities in the CAS panel’s reasoning. U.S. officials, athletes, and legal experts raised concerns over transparency and fairness in CAS rulings, calling for greater oversight in Olympic dispute resolution.
As of February 2025, Chiles has appealed the ruling before the Swiss Federal Tribunal, the only avenue for challenging CAS awards under Swiss law. While the Ted Stevens Olympic and Amateur Sports Act reinforces CAS’s authority over U.S. Olympic disputes, the controversy highlights broader tensions regarding arbitrator neutrality and the role of external oversight in sports arbitration.
NCAA Arbitration Disputes on the Rise
Beyond the Olympics, sports arbitration in the U.S. saw an uptick in NCAA and professional league disputes, with the American Arbitration Association (AAA) playing a central role. Following the U.S. Supreme Court’s landmark NCAA antitrust rulings, arbitration emerged as a key mechanism for resolving player compensation and eligibility disputes in the U.S.
Conclusion
U.S. arbitration experienced significant evolution in 2024, marked by several pivotal developments. The SVAMC Guidelines established new standards for ethical AI integration in dispute resolution, while landmark investment arbitration cases like TC Energy v. USA and NextEra tested established legal boundaries. Commercial arbitration gained enhanced clarity through Federal Arbitration Act interpretations in Smith v. Spizzirri, and the sports arbitration field navigated complex jurisdictional questions in the high-profile Chiles Olympic dispute. Together, these milestones demonstrate arbitration’s remarkable adaptability in addressing technological innovation, regulatory shifts, and increasingly complex cross-border disputes.
Looking ahead, AI’s expanding role, shifting investment protections, and evolving court interpretations will continue to shape arbitration practice in the U.S. and globally. As regulatory uncertainty persists and technological advancements accelerate, arbitration practitioners must adapt to a rapidly evolving legal environment, ensuring that arbitration remains a trusted, efficient, and effective dispute resolution mechanism in an era of change.
ABOUT THE AUTHORS
Clémence Prévot is the Director of Publications at Jus Mundi, where she oversees the development of legal content, strategic publishing initiatives and partnerships. As the Editor-in-Chief of Daily Jus and Managing Editor of the Jus Mundi Arbitration Review, she brings a unique perspective on the intersection of arbitration, AI, and legal innovation to Jus Mundi’s publications. A former international arbitration lawyer and mediator qualified in New York and Paris, she has worked across law firms, arbitral institutions, third-party funders, and legal tech.
Giulia Bartoletti is the Legal Publications Officer at Jus Mundi, where she spearheads thought leadership initiatives, including Jus Mundi’s Daily Jus blog and key Reports. A graduate of Paris I Panthéon-Sorbonne, she leverages her experience from international law firms, specializing in cross-border disputes, to enhance Jus Mundi’s legal content.
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*The views and opinions expressed by authors are theirs and do not necessarily reflect those of their organizations, employers, or Daily Jus, Jus Mundi, or Jus Connect.
