KPMG LLP v. Cocchi
88 So. 3d 327
| Fla. Dist. Ct. App. | 2012Background
- Appellant seeks to compel arbitration of disputes with appellee after this court’s prior opinion was vacated by the U.S. Supreme Court.
- Supreme Court vacated that part of the opinion addressing two claims and remanded for consideration of those claims’ arbitrability.
- Court previously held two claims were not subject to arbitration; two remaining claims were not addressed and were treated as moot.
- Supreme Court directed examination of the two remaining claims to determine if they are arbitrable and whether they are pendent claims.
- After remand, the court held the two remaining claims are derivative and potentially subject to arbitration, and declined to dismiss them as moot.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Are the two remaining claims pendent arbitrable claims? | KPMG contends the claims are derivative and must be arbitrated. | KPMG contends the two remaining claims are not moot and fall under arbitration. | Yes; they are derivative and potentially arbitrable. |
| Should the two remaining claims be compelled to arbitration if still pendent? | If pendent, they must be arbitrated under FAA. | Arbitration should not extend to claims that have been dismissed. | Yes; if pendent, must be submitted to arbitration. |
| Did the Supreme Court mandate reconsideration of all issues or only remaining claims? | Court must readdress all issues, including previously decided ones. | Only the remaining two claims required reconsideration; forum non conveniens issue remains intact. | Remand limited to remaining two claims; prior holdings on others preserved. |
Key Cases Cited
- Tooley v. Donaldson, Lufkin & Jenrette, Inc., 845 A.2d 1031 (Del. 2004) (test for direct vs. derivative actions for stockholders/limited partners)
- Dean Witter Reynolds, Inc. v. Byrd, 470 U.S. 213 (U.S. 1985) (FAA requires arbitration on arbitrable issues when a contract includes an arbitration clause)
- Stephenson v. Citco Group, Ltd., 700 F.Supp.2d 599 (S.D.N.Y. 2010) (direct vs. derivative and arbitration considerations for related claims)
- Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614 (U.S. 1985) (FAA policy favoring arbitration; framework for arbitrability)