Zuckerman Spaeder, LLP v. Auffenberg
396 U.S. App. D.C. 195
| D.C. Cir. | 2011Background
- Zuckerman Spaeder, LLP sued Auffenberg in DC Superior Court for unpaid attorneys’ fees, later removed to federal court.
- Auffenberg counterclaimed for legal malpractice and sought arbitration before the ACAB; he also moved for a stay under the FAA §3.
- District court denied the stay, concluding Auffenberg forfeited the right to arbitrate by engaging in litigation and mediation first.
- Auffenberg petitioned the ACAB on January 29, 2010, covering both the fee dispute and malpractice claims; he had previously participated in mediation and discovery.
- The court held Auffenberg forfeited the right to a stay because he delayed arbitration and his litigation activity prejudiced Zuckerman and taxed court resources; this appeal followed under FAA §16.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Auffenberg is in default forfeiture for not timely seeking arbitration | Auffenberg forfeited by delaying arbitration after initiating litigation. | Auffenberg repeatedly attempted to seek arbitration and was precluded by court involved procedures. | Yes; forfeiture/preemption found; stay denied. |
| Whether delay in seeking arbitration prejudices the other party | Delay increases costs and wastes resources, prejudicing Zuckerman. | No prejudice beyond standard litigation costs; timing should not foreclose arbitration. | Prejudice established; weighs against stay. |
| Whether record shows Auffenberg invoked arbitration at the first available opportunity | Auffenberg failed to invoke arbitration at first opportunity documented in record. | There was contact with Zuckerman and attempts to pursue arbitration. | Record shows failure to timely invoke; forfeiture applied. |
Key Cases Cited
- Cornell & Co. v. Barber & Ross Co., 360 F.2d 512 (D.C. Cir.1966) (default under FAA analyzed as waiver/forfeiture with emphasis on delay)
- Khan v. Parsons Global Servs. Ltd., 521 F.3d 421 (D.C. Cir.2008) (summarizes default analysis for stay and impact of litigation conduct)
- National Foundation for Cancer Research v. A.G. Edwards & Sons, Inc., 821 F.2d 772 (D.C. Cir.1987) (prejudice as a relevant factor in stay analysis)
- Cancer Research Tech., Inc. v. F.T.C., 821 F.2d 771 (D.C. Cir.1987) (conduct and prejudice considerations in arbitrate-stay analysis)
- Moses H. Cone Mem'l Hosp. v. Mercury Constr. Corp., 460 U.S. 1 (U.S.1983) (delay and waiver as defenses to arbitrability)
- FEC v. Legi-Tech, Inc., 75 F.3d 704 (D.C. Cir.1996) (allowing amendment of defenses after intervening decision with no prejudice)
- Arthur Andersen LLP v. Carlisle, U.S. _ (Supreme Court 2009) (context for FAA stay rights and arbitral referability)