*1 may attorney's for be liable contemnors Gregory SANCHEZ, Jon Portland Feminist in other contexts.
fees Plaintiff-Appellee, Life, Health Ctr. v. Advocates Women’s for 1989) Inc., v. non-party liable for (holding contemnors ELIZONDO, Robert Defendant- attorney’s bring plaintiffs’ incurred fees Appellant. contempt ing proceeding as a remedial No. 16-17345 sanction); Am. see also Gen. Ins. Co. v. Utils., Inc., 215, 220 E. Consol. of Appeals, Court United States (3d 1997) (affirming of attor award Ninth Circuit. ‘ contemnor); ney’s non-party fees December Argued Submitted MacKay, Waffenschmidt Francisco, San California (affirming award January Filed attorney’s fees from contemnors non-party they aided and abetted the because defen injunction). in violating
dants the court’s is no
There reason treat an award any differently.
fees under section
Therefore, grant application Plaintiffs’ attorney’s
for fees and costs related
Sheridan’s dismissal. prepar
Plaintiffs also seek fees answering they brief that never
filed,,having prevailed in instead their mo may
tion fees dismiss. We “expended pursuit work the ulti Hensley v.
mate result Ecke achieved.”
rhart, 461 U.S. 103 S.Ct. (1983) (internal quotation
L.Ed.2d ‘omitted).'
marks and' citation Because
Plaintiffs opposing did not succeed in merits,
Sheridan’s we award answering fees for preparing
them . brief Appellate refer this matter to the to calculate amount of
Commissioner attorney’s fees and non-taxable
reasonable to award Plaintiffs consistent with
costs Any subject
this such award order. Ninth panel. See
reconsideration
Cir. R. 39-1.9. THE
REFERRED TO APPELLATE
COMMISSIONER *2 (argued),
Jonathan E. Neuman Fresh Meadows, York, Defendant-Ap- for New pellant. Reno, Nevada, (argued), F. Bus
Steven Plaintiff-Appellee. D.'SMITH, Before: MILAN JR. IKUTA, Judges, SANDRA S. Circuit BATES,* Judge. JOHN D. Senior District by Judge Ikuta Concurrence * Bates, Judge The Honorable John D. Senior United States District the District of Co- of Arbitration Proce- the FINRA
OPINION Code dure. SMITH, Judge: M. if provides FINRA Rule Robert Elizondo Defendant-Appellant greater $50,000, amount of a claim is than appeals the district court’s order $100,000, not more than “the will remanding for award and *3 parties of consist one arbitrator unless was award- proceedings. Elizondo writing in to three arbitrators.” agree Award) (the in the $75,000 damages in ed 12401(b). Only “[i]f FINRA Rule arbitration, Elizondo initi- which parties’ $100,000” of claim more than amount a as a recoup to losses he suffered ated panel ... arbi- “the consist three should Gregory San- Plaintiff-Appellee result 12401(c).According- FINRA Rule trators.” mismanagement his investment chez’s ly, originally because Elizondo claimed argues portfolio. Elizondo district $100,000 compensatory damages, his in on the in the Award court erred single assigned to a arbitrator. case was his basis that the arbitrator exceeded au- days Eleven the arbitration hear-
thority. before (the Hearing) to take was scheduled court’s agree, the district reverse brief, Pre-Hearing filed a place, Elizondo vacatur, for further and remand the case damages in he increased his claim to proceedings. $125,500. to Elizondo seek amend did complaint, nor raise his did Sanchez AND FACTUAL PROCEDURAL changed objection damages to Elizondo’s BACKGROUND claim, prior Hearing. to the in are un- The essential facts this case Hearing, At the outset the arbi- In re- disputed. April Elizondo of the trator raised the issue increased Sanchez, as secu- tained is licensed a who request parties. Specifi- damages with the Industry by rities the Financial broker cally, parties arbitrator asked the (FINRA), man- Regulatory Authority objected proceeding whether either side age portfolio. September his investment arbitrator, single light before a in of Eli- portion invested a Sanchez damages by increased claimed Elizondo Ex- leveraged in portfolio zondo’s inverse and the Rules. Sanchez’s counsel FINRA change Traded Funds. Elizondo believed objected, argu- and the arbitrator heard holdings in placed his investment Ultimately, on issue. because nei- ment risky position. an inappropriately party a to dismiss ther had made motion 29, 2014, brought a April On Elizondo complaint, or to amend the Sanchez, against alleging claim that San- proceed that he would alone determined mismanaged chez portfolio. had Elizondo’s in damages origi- on the claimed based parties a FINRA executed Arbitration nal complaint. Agreement, according to which Submission (1) they agreed August their case to the arbitrator submit On $75,000 compensatory arbitration in with the FINRA Elizondo in accordance awarded interest, fees, Rules, By-Laws, damages, of Arbitration and and Code exclusive Award). (2) (the Procedure; September proce- to be costs On bound relating a brought petition dures and rules of FINRA to arbi- Sanchez tration; (3) Award, pursuant to 9 U.S.C. hearing and the event was to vacate the necessary, brought in accordance with 10. Elizondo answered conduct
lumbia, sitting by designation.
16(a)
to confirm the Award and U.S.C.
when a
countermotion
vacatur order also
attorney’s fees.
for a new
remands
arbitration. The Fifth
first,
Circuit reached this conclusion
arguments
raised several
Sanchez
International,
Forsythe
S.A. v. Gibbs Oil
petition
support of
vacate
Texas,
Company
STANDARD OF REVIEW Hutson, Sys., Bull HN 229 Info. (1st “We review de 321, [a] novo (holding F.3d 328 Cir. that court’s of an vacatur arbitration award.” “an order of the district court which va Lagstein v. Certain Underwriters and remands an cates arbitral is not award (9th 2010). 634, Lloyd’s, 607 640 F.3d Cir. interlocutory thus made an order” and Foods, appealable); Jays L.L.C. v. Chem.
ANALYSIS Union, 20, Allied Prod. Local & Workers (7th 2000) (hold 208 F.3d 612-13 Cir. I. Jurisdiction vacating orders an remanding that and of question we have whether immediately appealable, though are presents this case an jurisdiction issue nonfmal); V.I. Hous. Auth. v. Coastal Gen. impression first our Fed court. The (3d 914 Corp., Constr. Servs. (the FAA), Act 9 eral Arbitration U.S.C. 1994) (holding that Cir. where “remand 1-16, §§ appeal allows to be an taken re-opening begin constitutes a that would “confirming denying order confir or all over again,” the arbitration even before “vacating mation an or an award” arbitrator, the same the remand order is award,” or from “a final re decision with appealable); Landy Realty Corp. Michaels spect subject to an arbitration ... to [the 32B-32J, Emps. v. Local Sen. Int’l Un 16(a). However, §at the stat FAA].” ion, (2d 1992). 797 Cir. appealability ute does address the an' order that vacates and an award re persuaded by reasoning are We the case for a mands new arbitration. circuits, these we now that we and hold § jurisdiction pursuant 16 to re- have
All other circuits that have addressed for vacatur orders that also remand jurisdictional question view have deter- §of 16 and the appellate mined that courts are not new arbitration. The text de- jurisdiction motivating prived policies prompt conferred 9 enactment its award,” existing holding former 1. The Fifth have subse- that others the. quently distinguished appealable while is not. between "an order va- order is the latter Partners, cating E.g., Capital remanding case L.P. v. Nu- award and back Murchison Commc’ns, Inc., rehearing,” to arbitration for a and an order ance F.3d 2014); Realty Corp. Landy neither nor vacates confirms an award Michaels that 32B-32J, Union, Emps. but remands a to the Int’l "case back same v. Local Serv. (2d 1992). arbitration for clarification of Though filling gap Congress’ left si reach this conclusion. tween us to nothing regard § says rewriting Congress that text lence and orders, expressly permits the it -affirmatively, specifically remand' has enact vacating appeal ed.”). of orders arbitration recognize that also we have held awards, respecting decisions arbi- and final jurisdiction, previously “that un appellate 16(a). § tration.' See 9 U.S.C. Section 16(a) § to the der is confined U.S.C. prohibits appeal of or- expressly also types specified that are in the of orders- arbitration, stay pending granting a ders statute,” policy to invoke the and declined compel- directing proceed, arbitration expand scope FAA to that -arbitration, refusing enjoin or ling jurisdiction. See Dusen v. Van Swift 16(b). § See id. The difference arbitration. Inc., 830 Transp. Co. § permits appeal is clear: orders 2016). Here, simply that conclude terminate, arbitration, existing jurisdiction construing 16 to 'confer over -prohibiting appeal .of orders while involving cases remands new arbitra existing arbitration. continue an Because confining jurisdiction tion is under arbitration that remands a new vacatur specified types are orders initial as conclu- arbitration terminates expressly permits the statute. Section 16 remand, it sively does vacatur that as a orders ap- category, into the forrner and is falls awards, from this does exclude pealable. subcategory of appealable category a *5 vaca- to assume that Con- seeWe reason a that also involve remand. turs gress vacaturs that re- meant exclude good note as that we have We well category appealable mand from the va- Congress reason to infer chose not to all, saying: so. After the caturs without that inference is exclude remands because a of a remand order when court inclusion policies motivating consistent the common, an is vacates arbitration award § Specifically, interpretation 16. this Indeed, an when a district court vacates § strong 16 is consistent with the federal award, contemplates the -FAA itself re- policy arbitration that drove the favor 10(b) (“If § mand. 9 an award U.S.C. See If, passage. the inclu- example, FÁA’s is and the time within which the vacated sion agreement required the award to-be made remanding the case to a differ- order expired, may, has not the its dis^ panel a ent arbitration vaca- rendered] cretion, rehearing by the direct arbitra- (cid:127) .unreviewable., parties to tur arbitration tors,”). whether the could determine dis- never conclusion, reaching do not trict the stat- court acted within narrow interpretive pur exceed bounds our governing utory limits vacatur recognize ability that our infer view. We original Such result would dis- award. E.g., is congressional from silence limited. policies promote arbitra- serve the States, 129, 136, v. 501 U.S. Burns United judicial tion restrict review and (1991) 115 111 S.Ct. L.Ed.2d 123 awards. (“An congressional from inference drawn Int’l, By 915 at con- Forsythe F.2d certainly be silence cannot credited when trast, allowing cases appeals such would contrary to all other con is textual and policy ‘pro-arbitration de- intent.”); “further[ ] congressional textual evidence of signed confirmation of expedite arbitra- Higginbotham, Mobil Oil v. 436 U.S. Corp. 618, 625, by Congress tion when 56 581 awards’ articulated 98 S.Ct. L.Ed.2d (1978) (“There the FAA to allow from is a basic difference be it amended
1221
arbitration,”
concerning
certain orders
to consent to a single arbitrator,”
fused
Sys.,
HN
(quot
Bull
229
at
F.3d
328
arbitrator conducted
arbitration con-
Info.
Co.,
ing
Berg,
Hewlett-Packard
61 trary to “the
agreed
method
upon by the
(1st
1995)),
while still parties,” and thereby
powers.
exceeded his
see,
protecting against piecemeal appeals,
disagree.
here,
We
As relévant
Murchison,
e.g.,
422-23;
at
Bull
provides
U.S.C.
that a district court
(distin
HN
Sys., 229
Info.
may vacate an arbitration award “where
guishing
“[a] remand
new
for.
the arbitrators
powers.”
exceeded their
proceeding”
“an unappealable
from
inter
10(a)(4).
This is a very “high standard
locutory order” that would “offend .‘the
for vacatur.” Lagstein,
“An award selected, governing and the fails the arbitration decision ‘only al where interpreta- that the arbitrator’s conclude ” agreement.’ from the its essence draw not irrational. The tion and were F.3d Toyota Corp., Motor Biller v. grounded in the award was arbitrator’s Lagstein, (quoting parties’ agreement, essence 642); Lagstein, see also at to conduct an empowered the arbitrator (“[A]rbitrators exceed their at 643 F.3d By- with FINRA’s compliant they ‘act outside the powers ... when Laws, Rules, of Arbitration Pro- and Code agree parties’ contractual scope empowered cedure. FINRA Rule Ins. Co. v. (quoting Mich. Mut. ment.’” “interpret and determine the arbitrator Co., 44 Unigard Ins. Sec. provisions under the applicability all 1995))). “An arbitration award interpreta- that his provided Code” and if agreement from the ‘draws its essence binding upon the be “final and tions would agreement, from the the award is derived parties.” lan agreement’s light viewed context, as well other guage as indica Here, interpreted and de- arbitrator Biller, intentions.’” parties’ tions of FINRA Rule applicability termined the Lagstein, (quoting at 665 recognized that 642). equally applies at This standard single arbitrator de- permitted Rule of mat interpretation “to the arbitrator’s the amount of the claim cide a case where contract as well as procedure ters of $100,000, required a but does exceed Lagstein, 607 F.3d matters of substance.” where the amount decide case 643; RAE see also Polimaster Ltd. v. *7 $100,000. He asked the claimed exceeds (9th 832, Inc., Sys., 623 F.3d Cir. applicability to the parties address the 2010). light Pre-Hearing Rule Elizondo’s In an simi- Lagstein, we addressed issue damages the assertion that he was owed There, presented the lar to the one here. $125,500. the arbi- Ultimately, amount of had an arbitration district court vacated that Elizondo trator because determined damages award on the panel’s “punitive complaint enlarge to his had amended longer had ground ... that the claim, per- Rule original damages the dispute issuing jurisdiction over the after single to heard mitting a case be at initial 607 F.3d arbitration award.” words, In he applied. still other arbitrator “provid- policy at issue 643. The insurance language—specif- 12401’s interpreted Rule governed by was ed that the arbitration the claim”—to refer- ically, “the amount of of the the commercial arbitration rules pleaded in Association,” of the claim one ence the amount Arbitration American operative complaint rather than arbitrator. one [Sanchez’s] counsel ob- sought in amount later the arbitration. jected to request. [Elizondo’s] counsel’s deliberation, After due the Arbitrator interpretation This plausible. was “Un- granted request [Elizondo’s] counsel’s doubtedly, judges arbitra- reasonable proceed with one arbitrator. interpret tors could [FINRA] differently way the [arbitra- The district court took issue with the arbi Lagstein, did in this case.” at tor] 607 F.3d application, trator’s holding that the arbi Indeed, 645. the district court did so. But trator erred when applied improperly he this It province was error. was not the 12401(c). However, FINRA Rule when court, the district nor is it province comes to the disregard “manifest of law” court, this arbi- determine whether the standard, allegations “mere of error are error, trator committed even a serious Cal., insufficient.” Carter v. Health Net of error, in interpreting FINRA Rule Inc., (9th 2004). 374 F.3d Cir. Stolt-Nielsen, See The district court held that the arbitra reviewing S.Ct. 1758. A court need tor had contrary acted parties’ determine that the arbitrator confined agreement, and cited several out-of-circuit interpretation applica- himself in support cases holding. But even parties’ agreement. tion of the Id. Because authoritative, if those cases were here, the arbitrator so he did did ex- not, they they are to support fail the dis authority. ceed his The erred cases, holding. trict court’s In those courts the arbitrator’s rational award. were concerned with direct violations of parties’ agreements initial to arbitrate. See B. The Did Arbitrator Not Exhibit Int’l, Ltd., Brook v. Peak Disregard of the Manifest Law. 2002) (violation panel-selection disregard of the law “Manifest procedure employment agree outlined just something means than error more ment); Rice, Cargill Empresa Ni part the law or a failure Basicos, caraguense Dealimentos arbitrators or apply understand 1994) (violation com Biller, Lag law.” at 665 (quoting mercial contract requiring arbitrators cho stein, 641). F.3d at “To vacate agreement); sen mutual Avis ARent ground, on this ‘it must Union, Sys., Emps. Car Inc. v. Garage be clear from the that the record arbitra (2d Local recognized tors law and applicable ” 1986) (violation bargaining of collective ignored then it.’ (quoting Lagstein, rules). agreement selecting applicable 641). 607 F.3d at case, step the violation was Here, it is clear from the record that the removed. arbitrator did violate recognized applicable law directly parties’ agreement by initial applied then it. The itself re- Award relying upon rules other than the FINRA this, flects detailing deci- the arbitrator’s agreement applica Rules that the deemed sion-making process as follows: Rather, complied agree ble. he Immediately prior to the start *8 looking ment in FINRA Rules and evidentiary hearing, the Arbitrator discussing par their applicability with the procedural of panel raised the issue ties. composition based on mone- [Elizondo’s] Here, tary alleged claim the arbitrator’s violation which then exceeded $100,000.00. place step, response, interpre- took [Elizondo’s] next proceed counsel made a request applicable Only with tation of one of rules. fore,-! over this agree jurisdiction court in have cited we the district the cases that scenario, join I of the does but Section do volved a similar analysis. See court’s majority. district support Assoc., Pipkin, O’Brien & R.J. (holding that powers their
arbitrators did exce.ed applicable requirements
interpreting Rules re Association
National Futures Thus, the appointment).
garding authority sup no court identified
district vacatur, we hold now
porting his EX UNITED STATES America arbitrator did not ex erroneous. was BARRICK, disregard of the law. REL. Brandon Plain a manifest hibit tiff/Relator-Appellant, CONCLUSION reasons, reverse foregoing For the ATIO vacatur. 'Because the INTERN
the district court’s PARKER-MIGLIORINI International, NAL, LLC; petition court Sanchez’s resolved Parker Foods-USA; grounds Inc., on one the several known PMI as also asserted, we also re- Trading, LLC; that Sanchez vacatur Fortuna Cottonwood consistent proceedings' for further 1-10, mand Foods, LLC, John and Jane Does this decision. Before the district court Defendants-Appellees. may address countermotion Elizondo’s No. 16-4136 Award, confirm the it must determine grounds exist to whether additional of Appeals, Court United States vacate, modify, or correct the Award. Tenth Circuit. on Appellee appeal. shall the costs bear FILED December REMANDED, REVERSED AND IKUTA, Judge, concurring: 16(a) § appeal may “an
Under U.S.C. from—(1) order—(E) modify
be taken or Eli-
ing, correcting, vacating an award.” appeals
zondo from district order award, jurisdiction so we have Congress spoken
under Because has
clearly, engage there need policies underlying
examination 16(a) potential meaning of or the' Con
gressional scope silence determine the jurisdictional grant. See New Or Serv., City Pub. Inc. v. Council leans 350, 358-59, Orleans, 491
New (1989) (“Con
S.Ct. L.Ed.2d
gress, Judiciary, not the defines the jurisdiction within the con
scope federal bounds.”).
stitutionally permissible There