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Porter v. Williamson
168 So. 3d 1215
Ala.
2015
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Background

  • Marc and Donald Porter (brothers) formed several related companies; their nephew Byron Porter Williamson became a 10% shareholder under a 2004 shareholders agreement and an employee until his termination in 2012.
  • The agreement contains a specific-performance provision (Section 28) addressing disputes concerning the sale or disposition of the defined “Securities,” and a broad arbitration clause (Section 29) excepting “items of specific performance referred to above.”
  • After Williamson retired as a shareholder, the Porters refused to buy his shares; Williamson sued seeking specific performance (to force purchase), rescission, and tort claims (misrepresentation/suppression and conversion).
  • The Porter defendants moved to compel arbitration based on Section 29; the trial court denied the motion in full, reasoning Williamson’s specific-performance claim fell within the Section 28 exception.
  • On appeal, the court analyzed whether Williamson’s claims were within the specific-performance exception and whether the trial court erred by denying arbitration for all claims rather than severing arbitrable claims.

Issues

Issue Plaintiff's Argument Defendant's Argument Held
Whether Williamson’s request for specific performance and injunctive relief is arbitrable Williamson: specific-performance claim falls within Section 28 exception, so it is not subject to arbitration Porters: Section 28 is narrow and only prevents arbitration of injunctive relief to restrain third‑party sales; other disputes must be arbitrated under Section 29 Held: Specific-performance and injunctive claims fall within the express Section 28 exception and are not arbitrable
Whether the remaining claims (rescission, misrepresentation/suppression, conversion) are arbitrable Williamson effectively concedes the agreement’s validity and does not contend these claims fall within the specific-performance exception Porters: remaining claims are subject to arbitration under Section 29 Held: Trial court erred by denying arbitration in toto; remanded to (1) dismiss any remaining claims the court determines are not viable or (2) compel arbitration of the rest
Whether a court must send arbitrable claims to arbitration even if some claims are nonarbitrable Williamson argued trial court allowed discovery only on specific‑performance, implying other claims resolved Porters: arbitration must proceed on arbitrable claims Held: Under Supreme Court precedent, arbitrable claims must be sent to arbitration even if piecemeal litigation results; trial court must sever/send arbitrable claims

Key Cases Cited

  • KPMG LLP v. Cocchi, 132 S. Ct. 23 (2011) (arbitrable and nonarbitrable claims may be severed; arbitrable claims must go to arbitration)
  • Dean Witter Reynolds, Inc. v. Byrd, 470 U.S. 213 (1985) (arbitration of some claims notwithstanding remaining judicial claims)
  • Serra Chevrolet, Inc. v. Hock, 891 So.2d 844 (Ala.2004) (broad construction of “relating to” in arbitration clauses)
  • American Family Life Assur. Co. of Columbus v. Parker, 92 So.3d 58 (Ala.2012) (party cannot be required to arbitrate disputes it did not agree to arbitrate)
  • Allied-Bruce Terminix Cos. v. Dobson, 684 So.2d 102 (Ala.1996) (contract interpretation governs the scope of arbitration clauses)
Read the full case

Case Details

Case Name: Porter v. Williamson
Court Name: Supreme Court of Alabama
Date Published: Jan 30, 2015
Citation: 168 So. 3d 1215
Docket Number: 1130282
Court Abbreviation: Ala.