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Two More Arbitration-Related Cases Shed More Light On Supreme Court Nominee Gorsuch
Posted on Categories Arbitration, Court Decisions, News, Non-Securities ArbitrationTags , ,

Two other arbitration-related cases involving Supreme Court nominee Gorsuch have surfaced, which to us indicate that, while he may be a stickler for precise use of language, he is still pro-arbitration.

We covered in SAA 2017-05 Supreme Court nominee Neil M. Gorsuch’s views on arbitration based on past decisions. We stated that, based on a very limited sampling, Judge Gorsuch is pro-arbitration. Another two decisions have emerged that to us can both be read a couple of ways. The Court in Chelsea Family Pharmacy, PLLC v. Medco Health Sols., Inc., 567 F.3d 1191 (10th Cir. 2009), unanimously enforced an arbitration agreement for one claim but not another. Judge Gorsuch concurred, but wrote that evaluating whether an arbitration clause was broad or narrow was irrelevant and not in synch with either the Federal Arbitration Act (“FAA”) or SCOTUS jurisprudence: “When the arbitrability of a particular matter is plain on the face of the parties' agreement, the agreement is enforceable according to its terms -- whether the arbitration clause is ‘broad’ or ‘narrow’ or somewhere in between (where, if we are to be frank, many clauses will fall). If and to the degree an agreement contains some residual ambiguity, that's when the Moses Cone presumption of arbitrability applies -- and applies evenhandedly. We are told by the Supreme Court, again categorically, that ‘any doubts concerning the scope of arbitrable issues should be resolved in favor of arbitration, whether the problem at hand is the construction of the contract language itself or an allegation of waiver, delay, or a like defense to arbitrability.’ … [T]he judgment reached by the court today is surely right, it seems to me we have made more and needless work for ourselves in arbitration cases in having to peg clauses ‘broad’ or ‘narrow.’ Conventional tools of contract interpretation are sufficient to the task of deciding these cases, the only ones authorized by statute or the Supreme Court, and in no need of adornment” (citation omitted).

The second case is Genberg v. Porter, 566 F. App'x 719 (10th Cir. 2014), where Judge Gorsuch authored an opinion affirming the District Court’s refusal to compel arbitration against a non-signatory to the arbitration agreement: “As the district court noted, 'when the requirement to arbitrate is created by an agreement, it can be invoked only by a signatory of the agreement, and only against another signatory' ... In the case before us, it is undisputed that none of the defendant board members signed [Plaintiff’s] arbitration-clause-containing employment agreement. And, as Mr. Genberg seems to acknowledge, [company CEO] Porter did so only in his representative capacity for Ceragenix" (citation omitted).” Judge Gorsuch acknowledged that the corporate veil can sometimes be pierced to enforce arbitration agreements against non-signatories, “But [Plaintiff] didn't fairly present these legal theories to the district court, that court did not consider them in its ruling, and so under our precedent they are deemed forfeit or waived.”

(ed: *Our thanks to Loyola law prof Imre Szalai, who analyzed Chelsea Family in a January 31 blog post. Professor Szalai, who states up front that he “is not a fan” of President Trump, reads that case and Judge Gorsuch’s Opinion in Howard v. Ferrellgas Partners, L.P., 748 F.3d 975 (10th Cir. 2014), as perhaps portending that the Judge is a stickler on the FAA’s language: “If Gorsuch is willing to apply such a piercing, textual analysis to the FAA (and convince his new colleagues to do so), the edifice of the Court’s own creation (Justice O’Connor’s description of the FAA) will quickly come crashing down. Cases like Southland, the Mitsubishi trilogy, Circuit City, Preston, and many others should fall. I don’t know if Gorsuch will try to rock the boat on arbitration law, but I’ve got my fingers crossed.” **We’re sticking with our view that Judge Gorsuch is pro-arbitration.) (SAC Ref. No. 2017-06-09)

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