Oracle America, Inc. v. Myriad Group A.G.
2013 U.S. App. LEXIS 15284
| 9th Cir. | 2013Background
- Myriad (Swiss) and Oracle (U.S.) signed a 2002 Community Source License that included a TCK license and an arbitration clause; Oracle sued in N.D. Cal. for breach, Lanham Act, copyright infringement, and unfair competition; Myriad filed a separate suit in D. Del. and demanded arbitration.
- The Source License arbitration clause required arbitration under UNCITRAL rules (in effect at time of arbitration) as modified, but carved out that either party could bring actions in court (exclusive jurisdiction) for disputes relating to intellectual property rights or compliance with the TCK license.
- Myriad moved to compel arbitration of all claims; the district court compelled arbitration only for the breach‑of‑contract claim and denied arbitration for the remaining claims, concluding incorporation of UNCITRAL rules did not clearly and unmistakably delegate arbitrability.
- The district court later enjoined Myriad from proceeding with arbitration of non‑contract claims and read the carve‑out as giving courts exclusive authority over IP/TCK disputes.
- On appeal, the Ninth Circuit considered whether incorporating UNCITRAL rules constitutes clear and unmistakable evidence that the parties delegated questions of arbitrability to an arbitrator.
Issues
| Issue | Plaintiff's Argument (Myriad) | Defendant's Argument (Oracle) | Held |
|---|---|---|---|
| Whether incorporation of UNCITRAL rules clearly and unmistakably delegates arbitrability | Incorporation does delegate arbitrability to the arbitrator | Incorporation does not; rules (esp. 2010 art. 23(3)) leave concurrent court authority and carve‑out shows parties meant courts to decide | Yes — incorporation of UNCITRAL rules is clear and unmistakable delegation of arbitrability to arbitrator |
| Effect of 1976 vs. 2010 UNCITRAL versions | Either version vests arbitrator with authority to decide jurisdiction/objections | Oracle argued 2010's language and art. 23(3) create ambiguity permitting court challenges | Irrelevant — both versions sufficiently vest authority in arbitrator; article 23(3) doesn't change delegation outcome |
| Whether the carve‑out for IP/TCK disputes negates delegation | Carve‑out addresses which claims are subject to court vs arbitration, not who decides arbitrability; thus delegation still applies | Carve‑out (exclusive court jurisdiction for IP/TCK) shows parties intended courts to decide arbitrability for those disputes | Carve‑out does not negate delegation; determining whether a claim falls within carve‑out is itself an arbitrability question for the arbitrator |
| Whether the Source License modifications altered UNCITRAL jurisdictional provisions | The contract modifications do not alter UNCITRAL’s jurisdictional grant | Oracle claimed the contract’s “exclusive” court carve‑out and the “as modified herein” language modified UNCITRAL to vest courts with arbitrability determinations | No modification found that alters UNCITRAL rule effect; delegation stands |
Key Cases Cited
- Moses H. Cone Mem'l Hosp. v. Mercury Constr. Corp., 460 U.S. 1 (1983) (federal policy favors arbitration and resolves doubts about scope in favor of arbitration)
- First Options of Chi., Inc. v. Kaplan, 514 U.S. 938 (1995) (who decides arbitrability depends on parties' agreement)
- Howsam v. Dean Witter Reynolds, Inc., 537 U.S. 79 (2002) (delegation of arbitrability requires clear and unmistakable evidence)
- Stolt‑Nielsen S.A. v. AnimalFeeds Int'l Corp., 559 U.S. 662 (2010) (FAA enforces arbitration agreements according to their terms)
- Republic of Ecuador v. Chevron Corp., 638 F.3d 384 (2d Cir. 2011) (incorporation of UNCITRAL rules delegates arbitrability to arbitrator)
- Republic of Argentina v. BG Group PLC, 665 F.3d 1363 (D.C. Cir. 2012) (same conclusion regarding UNCITRAL rules)
- Petrofac, Inc. v. DynMcDermott Petroleum Operations Co., 687 F.3d 671 (5th Cir. 2012) (incorporation of AAA rules is clear and unmistakable delegation of arbitrability)