Charles Grant v. Kevin Houser
469 F. App'x 310
5th Cir.2012Background
- Berger opened a securities account with BYA; arbitration clause signed above Berger's signature in the New Account Form and in the ABBS agreement.
- Houser advised Berger to invest in Louisiana Film Studios, LLC (LFS) and Berger paid $250,000 to Houser/LFS.
- BYA was acquired by Securities America; Securities America later acquired BYA’s assets and Berger’s account.
- Berger filed suit in 2010 against Houser, Securities America, and American International with multiple claims.
- Appellants moved to compel arbitration in 2010; Miller Declaration claimed BYA’s rights were assigned to Securities America; district court denied the first motion in January 2011.
- Berger filed a second amended complaint; a second motion to compel arbitration was denied in March 2011; two interlocutory appeals followed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Jurisdiction to decide second motion to compel arbitration. | Appellants argue district court lacked jurisdiction. | Berger argues district court could proceed. | District court lacked jurisdiction; Second Order vacated. |
| Sufficiency of Miller Declaration to prove assignment. | Berger contends no sufficient evidence of BYA-to-Securities America assignment. | Appellants rely on Miller Declaration to prove assignment. | Miller Declaration sufficient to establish assignment by preponderance. |
| Scope of arbitration agreement covering all claims. | Arbitration clause broadly covers all claims by Berger. | Agreement does not sweep all claims. | All within court's jurisdiction fall within the arbitration agreement. |
| Equitable estoppel applicability. | Equitable estoppel supports arbitration. | Not necessary to reach if assignment proven. | Not reached due to jurisdiction issue; not necessary to decide estoppel. |
| Impact of appellate posture on arbitration issues. | Second motion addressed new claims; should be arbitrable. | Arbitrability issues limited to first appeal scope. | Under the majority, jurisdiction issue controls; See remand. |
Key Cases Cited
- Weingarten Realty Investors v. Miller, 661 F.3d 904 (5th Cir. 2011) (interlocutory appeal does not automatically divest district court of jurisdiction over non-appealed matters; courts may proceed on issues not on appeal)
- Griggs v. Provident Consumer Discount Co., 459 U.S. 56 (Supreme Court 1982) (jurisdiction may be divested when notice of appeal challenges a judgment while a motion to amend is pending)
- Doddy v. Oxy USA, Inc., 101 F.3d 448 (5th Cir. 1996) (uncontroverted affidavit may support arbitration assignment by preponderance of the evidence)
- Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1 (Supreme Court 1983) (strong presumption in favor of arbitration; summary inquiry on motion to compel)
- Pennzoil Exploration & Prod. Co. v. Ramco Energy Ltd., 139 F.3d 1061 (5th Cir. 1998) (broad arbitration agreements can reach related disputes)