Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca7-19-02123/USCOURTS-ca7-19-02123-0/pdf.json

Nature of Suit Code: 850
Nature of Suit: Securities, Commodities, Exchange
Cause of Action: 

---

In the 

United States Court of Appeals 

For the Seventh Circuit ____________________

Nos. 19‐2111 & 19‐2123

INTL FCSTONE FINANCIAL INC.

Plaintiff‐Appellee,

v.

DAVE JACOBSON, et al.,

Defendants‐Appellants.

____________________

Appeals from the United States District Court for the

Northern District of Illinois, Eastern Division.

Nos. 19‐cv‐01438 and 19‐cv‐01629 — Joan H. Lefkow, Judge.

____________________

ARGUED DECEMBER 13, 2019 — DECIDED FEBRUARY 24, 2020

____________________

Before MANION, KANNE, and BRENNAN, Circuit Judges.

BRENNAN, Circuit Judge. Investors in commodities futures

appeal an order to arbitrate their trading disputes. But they

stumble out of the blocks: our review is limited to “final deci‐

sions of the district courts.” 28 U.S.C. § 1291. Here, the district

court ordered arbitration and designated an arbitration fo‐

rum, then stayed the case to address related issues, including

the arbitration venue. Put more simply, the district court

made non‐final decisions.  

Case: 19-2123 Document: 50 Filed: 02/24/2020 Pages: 22
2 Nos. 19‐2111 & 19‐2123

Although statutory exceptions exist to the rule of finality,

none apply here. Because this case remained open to resolve

certain issues, we dismiss defendants’ appeal for lack of juris‐

diction.

I

Defendants, commodities futures investors, maintained

trading accounts with INTL FCStone Financial Inc.

(“FCStone”), a clearing firm which handled the confirmation,

settlement, and delivery of transactions. In November 2018,

extraordinary volatility in the natural gas market wiped out

defendants’ account balances with FCStone, leaving some de‐

fendants in debt. Lawsuits followed: defendants alleged

Commodity Exchange Act violations against FCStone;

FCStone sought payment from defendants with negative bal‐

ances.

Defendants drew first blood. They launched arbitration

proceedings against FCStone before the Financial Industry

Regulatory Authority (“FINRA”). FCStone responded with a

declaratory judgment action claiming the parties must arbi‐

trate their disputes before the National Futures Association

(“NFA”),1 and that FINRA lacks jurisdiction over the under‐

lying disputes.  

1 The NFA is a self‐regulatory organization and a “registered futures

association” under the Commodity Exchange Act, 7 U.S.C. §§ 1 et seq.

Belom v. Nat’l Futures Ass’n, 284 F.3d 795, 797 (7th Cir. 2002). An associa‐

tion cannot be registered as a futures association under the Commodity

Exchange Act unless its rules “‘provide a fair, equitable, and expeditious

procedure through arbitration or otherwise for the settlement of custom‐

ers’ claims and grievances.’” Id. (quoting 7 U.S.C. § 21(b)(10)).

Case: 19-2123 Document: 50 Filed: 02/24/2020 Pages: 22
Nos. 19‐2111 & 19‐2123 3

The district court ruled for FCStone. To understand that

decision and its impact on our jurisdiction, first we must un‐

tangle the parties’ district court arguments about the proper

arbitration forum.

FCStone argued that arbitration agreements and federal

regulations bind defendants to proceed before the NFA.

When defendants opened their futures accounts with

FCStone, they signed arbitration agreements that said:  

Any controversy or claim arising out of or relat‐

ing to your accounts shall be settled by arbitra‐

tion, either (1) under the Code of Arbitration of

the National Futures Association, or (2) upon

the contract market on which the disputed

transaction was executed or could have been ex‐

ecuted. ... At the time you notify ... [FCStone] ...

of your intent to submit a claim to arbitration,

... you will have an opportunity to elect a qual‐

ified forum for conducting the proceedings, and

will be supplied with a list of qualified organi‐

zations.  

FCStone reads this provision to limit account disputes to

arbitral forums operated by the NFA or the contract market

on which the disputed transaction was executed (here, the

Chicago Mercantile Exchange). Because the agreements do

not provide FINRA arbitration as an option, FCStone argued,

defendants have no purported rights to arbitrate before

FINRA.  

Next, FCStone claimed that Commodity Futures Trading

Commission (“CFTC”) regulations preclude FINRA arbitra‐

tion. See 7 U.S.C. § 2(a)(1)(A) (establishing CFTC jurisdiction

Case: 19-2123 Document: 50 Filed: 02/24/2020 Pages: 22
4 Nos. 19‐2111 & 19‐2123

over “accounts, agreements ... and transactions involving ...

contracts of sale of a commodity for future delivery”).

FCStone pointed to 17 C.F.R. § 166.5 and reasoned that the

CFTC adopted that provision to govern arbitration agree‐

ments over CFTC‐regulated disputes. See 17 C.F.R.

§ 166.5(b)–(c) (allowing futures investors to enter binding pre‐

dispute arbitration agreements with CFTC registrants, so long

as they are voluntary and not a condition to opening an ac‐

count). FCStone submits that investors entering into such

agreements must abide by § 166.5 for selecting an arbitration

forum, which they summarize in a four‐step process:  

 Step 1: investor provides the CFTC registrant

with notice of intent to arbitrate;

 Step 2: registrant provides the investor a list of

three qualified arbitration organizations and the

applicable rules for each arbitral option;

 Step 3: investor must select one of the three arbi‐

tral options offered within 45 days;

 Step 4: if the investor fails to select one of the

three arbitral options offered within 45 days, the

registrant has the exclusive right to select one of

the arbitral options.

See id. § 166.5(c)(5).  

FCStone believes defendants must follow these steps for

two reasons. First, FCStone provided services to defendants

exclusively out of its futures commission merchant division,

which provides services only in connection with futures and

Case: 19-2123 Document: 50 Filed: 02/24/2020 Pages: 22
Nos. 19‐2111 & 19‐2123 5

options traded on futures exchanges.2 Second, that division is

registered with and regulated by the CFTC.  

Defendants disregarded “Step 1,” however, and filed for

FINRA arbitration, alleging FCStone violated 7 U.S.C. § 13c of

the Commodity Exchange Act.3 After learning about defend‐

ants’ FINRA filings, FCStone prompted defendants about

their obligations under the arbitration agreements and

§ 166.5. FCStone also stressed that, like the parties’ agree‐

ments, § 166.5 neither mentions nor contemplates FINRA as

an arbitration forum over disputes. In keeping with “Step 2,”

FCStone sent defendants a list of three forums to arbitrate

their disputes: the NFA, the Chicago Mercantile Exchange,

and AAA’s commercial arbitration forum. Defendants re‐

jected all three. Despite this rejection, FCStone waited 45 days,

allowing defendants a chance to comply with “Step 3.” By the

end of that timeframe, no defendants had selected any of the

arbitration forums offered by FCStone. So, invoking “Step 4,”

FCStone initiated arbitration proceedings before the NFA.  

Not surprisingly, defendants refused NFA arbitration.

FCStone responded with a complaint for declaratory and in‐

junctive relief. After several FCStone customers not named in

2 The Commodity Exchange Actrequires that futures contracts be sold

through commodity exchanges and the futures commission merchants

registered on those exchanges. Nagel v. ADM Invʹr Servs., Inc., 217 F.3d

436, 439 (7th Cir. 2000) (citing 7 U.S.C. § 6(a)). Futures commission mer‐

chants operate in the commodity industry akin to the securities industry’s

broker‐dealers. In re Sentinel Mgmt. Grp., Inc., 728 F.3d 660, 662 (7th Cir.

2013).

3 Section 13c imposes liability for “[a]ny person who commits, or who

willfully aids, abets, counsels, commands, induces, or procures the com‐

mission of” a Commodity Exchange Act violation. 7 U.S.C. § 13c(a)–(b).

Case: 19-2123 Document: 50 Filed: 02/24/2020 Pages: 22
6 Nos. 19‐2111 & 19‐2123

that suit tried to initiate FINRA arbitration, FCStone amended

its complaint to join them. The amended complaint also

added a count under the Federal Arbitration Act (“FAA”), 9

U.S.C. § 4, to compel arbitration. At the same time, FCStone

moved to compel defendants to NFA arbitration and re‐

quested the entry of “a declaratory judgment to the effect that

FINRA is not a valid arbitration forum forthe parties’ dispute,

and NFA is the valid forum for this dispute.”

Defendants disagreed with FCStone’s claims and insisted

the parties must arbitrate their disputes before FINRA. Why?

Because separate from its futures commission merchant divi‐

sion, FCStone also maintains a securities brokerage division

registered with and regulated by FINRA and the Securities

and Exchange Commission (“SEC”).  

To understand defendants’ position, some background

about FINRA helps:

FINRA is a private, non‐profit corporation that

is registered with the [SEC] as a “national secu‐

rities association.” Such private regulation was

made possible by the Maloney Act, which pro‐

vided for the establishment of self‐regulatory

organizations to oversee the securities markets.

15 U.S.C. §§ 78o et seq. In this capacity FINRA

creates and enforces rules that govern the in‐

dustry alongside the SEC and is subject to sig‐

nificant SEC oversight. The SEC must approve

all of FINRA’s rules, 15 U.S.C. § 78s(b)(1), and

the SEC may abrogate, add to, and delete from

all FINRA rules as it deems necessary. 15 U.S.C.

§ 78s(c).

Case: 19-2123 Document: 50 Filed: 02/24/2020 Pages: 22
Nos. 19‐2111 & 19‐2123 7

Aslin v. Fin. Indus. Regulatory Auth., Inc., 704 F.3d 475, 476 (7th

Cir. 2013).

Federal securities laws generally require firms that deal in

securities to comply with FINRA rules. Id. Defendants

pointed to FINRA Rule 12200, which requires FINRA mem‐

bers to submit to FINRA arbitration when requested by “a

customer ... in connection with the business activities of the

member.” Because FCStone provided services to defendants,

and it is a FINRA member through its securities brokerage di‐

vision, defendants claimed to be customers within the mean‐

ing of FINRA Rule 12200.4 FCStone countered defendant’s

position with these undisputed facts:

 Defendants’ account agreements did not au‐

thorize FCStone to trade in securities products.

 FCStone’s futures commission merchant divi‐

sion—which managed defendants’ accounts—

does not provide securities brokerage services

and is not regulated by FINRA or the SEC.

 FCStone’s securities brokerage division pro‐

vided no services to, and did not enter into any

transactions with, defendants.

 FCStone’s securities brokerage division is

wholly distinct from its futures commission

merchant division: the products within each di‐

vision are different; the treasury, account

onboarding, and operations departments of

each division are different; the divisions have

4 FINRA does not define “customer,” except to say that a “customer

shall not include a broker or dealer.” FINRA Rule 12100(k).

Case: 19-2123 Document: 50 Filed: 02/24/2020 Pages: 22
8 Nos. 19‐2111 & 19‐2123

different compliance officers and compliance

staff; the divisions have different controllers

and accounting staff; and each division’s rec‐

ords are kept separate.

Undeterred, defendants argued that FINRA—which

regulates the securities industry, not commodity futures mar‐

kets—is the appropriate forum to arbitrate their commodities‐

based claims.5 Defendants also argued that the arbitration

agreements neither waive FINRA arbitration nor supersede

FINRA Rule 12200; even if they did, defendants claimed

FINRA Rule 2268(d)(1) prohibits such waivers.6 To top things

off, defendants claimed FCStone repudiated the arbitration

agreements. According to defendants’ version of events,

FCStone offered “AAA arbitration” and then refused to coop‐

erate once defendants chose to arbitrate there. This “inequita‐

ble conduct,” defendants argued, amounted to a breach and

repudiation of the arbitration agreements.  

Unlike FCStone, defendants did not move to compel

FINRA arbitration. But they did oppose FCStone’s arbitra‐

tion, injunction, and declaratory relief request. Defendants

also moved to dismiss FCStone’s amended complaint and

5 FINRA’s publications explain “[t]he Commodity Futures Trading

Commission (CFTC) is the federal government agency that regulates the

commodity futures, commodity options, and swaps trading markets. An‐

yone who trades futures with the public or gives advice about futures

trading must be registered with the National Futures Association (NFA),

the independent regulatorfor anyone who trades futures with the public.”

FINRA, Commodity Futures, https://www.finra.org/investors/learn‐to‐in‐

vest/types‐investments/commodity‐futures (last visited February 4, 2020).

6 FINRA Rule 2268(d)(1) provides that “[n]o predispute arbitration

agreement shall include any condition that ... limits or contradicts the

rules of any self‐regulatory organization.”

Case: 19-2123 Document: 50 Filed: 02/24/2020 Pages: 22
Nos. 19‐2111 & 19‐2123 9

tacked on a sanctions motion against FCStone for seeking

“anti‐arbitration injunctive relief.”

We turn now to the district court’s order. The court faced

a fork in the road: on the question of arbitration forum, did

the parties’ arbitration agreements or FINRA Rule 12200 gov‐

ern? The district court took on the latter (and more intricate)

inquiry, analyzing whether the parties’ disputes fell within

FINRA’s regulatory ambit. After careful analysis the court an‐

swered “no” and held “defendants agreed to arbitrate their

disputes at the NFA and that FINRA Rule 12200 does not ap‐

ply to the underlying commodity futures and options ac‐

counts and transactions here.” In so holding, the district court

concluded it did not need to address whether the arbitration

agreements superseded or waived defendants’ claims for

FINRA arbitration.  

The district court also held:  

 Defendants are not “customers” within the

meaning of FINRA Rule 12200.

 The parties have no agreement to arbitrate

disputes before FINRA.

 FINRA lacks jurisdiction over the underly‐

ing disputes.

 All defendants (except one) entered into a

valid and enforceable arbitration agreement

with FCStone.

 Because defendants either rejected or failed

to choose a qualified arbitral forum under

the arbitration agreements within 45 days,

FCStone properly chose the NFA.

Case: 19-2123 Document: 50 Filed: 02/24/2020 Pages: 22
10 Nos. 19‐2111 & 19‐2123

 The NFA is the proper arbitral forum for the

underlying disputes under the arbitration

agreements.

In addition to these rulings, the district court rejected de‐

fendants’ contention that FCStone breached and repudiated

the arbitration agreements. The court found that after

§ 166.5’s 45‐day notice period expired, some defendants sent

FCStone a letter “agreeing” to arbitrate at AAA’s consumer

arbitration forum. But AAA’s consumer forum was not one of

the three arbitral options offered by FCStone. FCStone offered

arbitration only before the NFA, the Chicago Mercantile Ex‐

change, and AAA’s commercial arbitration forum. So not only

did those defendants “agree” to the wrong AAA forum, they

did so too late. On that basis, the district court concluded that

defendants either “expressly rejected AAA in favor of

FINRA,” selected AAA “after the [§ 166.5] deadline passed,”

or never demanded arbitration before AAA.7  

Consistent with these rulings, the district court denied de‐

fendants’ motions and directed defendants to submit their

disputes to the NFA; it also denied FCStone’s motion for a

preliminary injunction without prejudice. The district court

7 As part of its ruling, the district court noted: “Unless FCStone pro‐

vided context that did not find its way into the record here, FCStone’s rep‐

resentation ... that it did not agree to arbitrate ... at the AAA appears

misleading.” We take no position on whether the district court should cor‐

rect this sentence in its order. If it decides to, the record reflects: (1)

FCStone’s complaint and first amended complaint identify AAA “under

its Commercial Arbitration Rules” as the forum offered; and (2) both com‐

plaints attached AAA’s commercial arbitration rules as exhibits. See FED.

R. CIV. P. 60(a) (allowing district courts on motion or on their own to cor‐

rect a mistake arising from oversight or omission whenever one is found

in an order or other part of the record).  

Case: 19-2123 Document: 50 Filed: 02/24/2020 Pages: 22
Nos. 19‐2111 & 19‐2123 11

then scheduled a status conference to take place the day after

defendants’ deadline to submit their claims to the NFA.  

Defendants appealed before the next court conference.

The district court responded by staying the case, but did not

explain the terms or purpose of the stay. Since issuing the

stay, the district court has concluded that defendants’ appeal

divested the court of its jurisdiction to decide unresolved is‐

sues related to its arbitration order. Those issues include arbi‐

tration venue, grounds for a permanent injunction, the time

needed for defendants to comply with the arbitration order,

and attorneys’ fees.  

II

Defendants ask us to reverse the district court and order

the parties to arbitrate before FINRA. Our review begins and

ends with jurisdiction. First, we consider appellate jurisdic‐

tion, then we address the district court’s jurisdiction to com‐

plete its work notwithstanding defendants’ attempted appeal.

A

Section 1291 of the Judicial Code grants courts of appeals

jurisdiction over “all final decisions of the district courts of the

United States.” 28 U.S.C. § 1291. A decision is final if it “ends

the litigation on the merits and leaves nothing more for the

court to do but execute the judgment.” Green Tree Fin. Corp.‐

Alabama v. Randolph, 531 U.S. 79, 86 (2000). A decision is not

final “[s]o long as the matter remains open, unfinished or in‐

conclusive.” Cohen v. Beneficial Indus. Loan Corp., 337 U.S. 541,

546 (1949). The finality requirement reflects “the general rule

... that the whole case and every matter in controversy in it

must be decided in a single appeal.” Microsoft Corp. v. Baker,

137 S. Ct. 1702, 1712 (2017) (citation and internal brackets

Case: 19-2123 Document: 50 Filed: 02/24/2020 Pages: 22
12 Nos. 19‐2111 & 19‐2123

omitted). It also “preserves the proper balance between trial

and appellate courts, minimizes the harassment and delay

that would result from repeated interlocutory appeals, and

promotes the efficient administration of justice.” Id.

Like § 1291, the FAA authorizes appellate jurisdiction over

“a final decision with respect to an arbitration.” 9 U.S.C.

§ 16(a)(3). And, just as 28 U.S.C. § 1292(a)(1) permits interloc‐

utory appeals of orders granting injunctions, the FAA con‐

tains a statutory exception to the final decision rule for “an

interlocutory order granting ... an injunction against an arbitra‐

tion.” 9 U.S.C. § 16(a)(2) (emphasis added). Defendants argue

§ 16(a)(2), § 16(a)(3), and § 1292(a)(1) confer jurisdiction here.

Their arguments fall into two categories: jurisdiction due to

an injunction, and jurisdiction due to a final decision.

Defendants contend the district court issued an “anti‐arbi‐

tration injunction,” so jurisdiction exists under § 16(a)(2) and

§ 1292(a)(1). But the opposite occurred—the district court de‐

nied FCStone’s request for a preliminary injunction halting

FINRA arbitrations.  

To sidestep the absence of an express injunction,

defendants imply an injunction, which they predicate on their

first‐in‐time FINRA filing and the “liberal federal policy” em‐

bodied in the FAA “favoring arbitration.” Br. of Defendants‐

Appellants 30, ECF No. 25, quoting Moses H. Cone Mem’l Hosp.

v. Mercury Constr. Corp., 460 U.S. 1, 24 (1983). Defendants ar‐

gue the FAA commands FINRA arbitration rather than NFA

arbitration. By forcing defendants to proceed before the NFA,

they argue, the district court “effectively enjoined” pending

FINRA arbitrations, which “amounted to an anti‐arbitration

injunction.” For us to hold otherwise, defendants protest,

Case: 19-2123 Document: 50 Filed: 02/24/2020 Pages: 22
Nos. 19‐2111 & 19‐2123 13

would “invert[] the basic purpose of the FAA.” These argu‐

ments fail for three reasons.

First reason. To construe the district court’s order as an in‐

junction, defendants ask us to do something we cannot: place

a law’s purpose above its text. “We as judges of the U.S. Court

of Appeals have only the power to interpret the law; it is the

duty of the legislative branch to make the law.” Welsh v. Boy

Scouts of Am., 993 F.2d 1267, 1270 (7th Cir. 1993). To substitute

text with purpose, as defendants’ argument requires, would

have us assume a legislative role and overstep our limited au‐

thority. See, e.g., Powerex Corp. v. Reliant Energy Servs., Inc., 551

U.S. 224, 237–38, 238 n.5 (2007) (admonishing that “[a]ppellate

courts must take ... jurisdictional prescription seriously” and

that courts impermissibly “assume the legislative role” by

suppressing a statute to extend jurisdiction). We must “follow

the text even if doing so will supposedly undercut a basic ob‐

jective of the statute.” Baker Botts L.L.P. v. ASARCO LLC, 135

S. Ct. 2158, 2169 (2015) (citation and internal quotation marks

omitted); see also Morrison v. Nat’l Australia Bank Ltd., 561 U.S.

247, 270 (2010) (“It is our function to give the statute the effect

its language suggests, however modest that may be; not to ex‐

tend it to admirable purposes it might be used to achieve.”).

To that end, we do not “speculate upon congressional mo‐

tives” when attempting to discern the meaning of a statutory

text, Riegel v. Medtronic, Inc., 552 U.S. 312, 326 (2008), because

we “assum[e] that the ordinary meaning of that [text] accu‐

rately expresses the legislative purpose,” Gross v. FBL Fin.

Servs., Inc., 557 U.S. 167, 175 (2009). Cf. W. Va. Univ. Hosps.,

Inc. v. Casey, 499 U.S. 83, 98 (1991) (“The best evidence of [stat‐

utory] purpose is the statutory text adopted by both Houses

of Congress and submitted to the President.”), superseded by

Case: 19-2123 Document: 50 Filed: 02/24/2020 Pages: 22
14 Nos. 19‐2111 & 19‐2123

statute as stated in Landgraf v. USI Film Products, 511 U.S. 244,

251 (1994).

We do not suggest a statute’s purpose lacks any analytical

function. See, e.g., ANTONIN SCALIA & BRYAN A. GARNER,

READING LAW 20 (2012) (“The evident purpose of what a text

seeks to achieve is an essential element of context that gives

meaning to words.”); see also id. at 56–58 (“[W]ords are given

meaning by their context, and context includes the purpose of

the text.”). But that function is always limited by, and subor‐

dinated to, the text of the law under review. See Conn. Nat’l

Bank v. Germain, 503 U.S. 249, 253–54 (1992) (“[C]ourts must

presume that a legislature says in a statute what it means and

means in a statute what it says there.”). Plain text trumps pur‐

pose. See Mohamad v. Palestinian Auth., 566 U.S. 449, 460 (2012)

(“[P]etitioners’ purposive argument simply cannot overcome

the force of the plain text.”); Kloeckner v. Solis, 568 U.S. 41, 55

n.4 (2012) (“[E]ven the most formidable argument concerning

the statute’s purposes could not overcome the clarity we find

in the statute’s text.”). And when the text is clear, “there is no

need to ... consult” its purpose. Cooper Indus., Inc. v. Aviall

Servs., Inc., 543 U.S. 157, 167 (2004). For these reasons, the

FAA’s purpose cannot be used to contradict, supplement, or

suppress its text, as defendants seek.  

Defendants also construe the FAA’s purpose too broadly

when they reduce it to “encouraging arbitration.” The Su‐

preme Court “ha[s] said on numerous occasions that the cen‐

tral or primary purpose of the FAA is to ensure that private

agreements to arbitrate are enforced according to their

terms.” Stolt‐Nielsen S.A. v. AnimalFeeds Int’l Corp., 559 U.S.

662, 682 (2010) (internal quotation marks and citations omit‐

ted). Put another way, the FAA “is a congressional

Case: 19-2123 Document: 50 Filed: 02/24/2020 Pages: 22
Nos. 19‐2111 & 19‐2123 15

declaration of a liberal federal policy favoring arbitration

agreements,” Moses H. Cone Mem’l Hosp., 460 U.S. at 24 (em‐

phasis added), not merely arbitration. See, e.g., New Prime Inc.

v. Oliveira, 139 S. Ct. 532, 543 (2019) (“Congress adopted the

Arbitration Act in an effort to ... establish a liberal federal pol‐

icy favoring arbitration agreements.”); AT&T Mobility LLC v.

Concepcion, 563 U.S. 333, 339 (2011) (“We have described [9

U.S.C. § 2] as reflecting both a liberal federal policy favoring

arbitration ... and the fundamental principle that arbitration

is a matter of contract.” (internal citations and quotation

marks omitted)).  

All this takes us back to the text of the FAA. Section 2 pro‐

vides that “[a] written provision in ... a contract ... to settle

by arbitration a controversy thereafter arising out of such con‐

tract ... shall be valid, irrevocable, and enforceable.” 9 U.S.C.

§ 2;see also Gupta v. Morgan Stanley Smith Barney, LLC, 934 F.3d

705, 710 (7th Cir. 2019) (citing 9 U.S.C. §§ 2, 4) (“[T]he [FAA]

mandates enforcement of valid arbitration agreements.”).

And § 4 says “[a] party aggrieved by the alleged ... refusal of

another to arbitrate under a written agreement for arbitration

may petition any United States district court ... for an order

directing that such arbitration proceed in the manner pro‐

vided for in such agreement.” 9 U.S.C. § 4; see also Hasbro, Inc.

v. Catalyst USA, Inc., 367 F.3d 689, 692 (7th Cir. 2004) (“The

FAA makes arbitration agreements enforceable to the same

extent as other contracts, so courts must enforce privately ne‐

gotiated agreements to arbitrate, like other contracts, in ac‐

cordance with their terms.” (internal quotation marks and

citations omitted)).

Here, defendants concede “[t]he parties indisputably

agreed to arbitrate” disputes through the arbitration

Case: 19-2123 Document: 50 Filed: 02/24/2020 Pages: 22
16 Nos. 19‐2111 & 19‐2123

agreements. Br. of Defendants‐Appellants 5, 15, 20, ECF No.

25. The district court directed arbitration before the NFA un‐

der § 4 of the FAA forthe same reason. So, contrary to defend‐

ants’ position, the district court neither issued an anti‐

arbitration injunction nor defied the FAA’s purpose. Instead,

the court issued an order to arbitrate under the terms of arbi‐

tration agreements that defendants entered voluntarily. That

is a pro‐arbitration decision, and that is what § 2 and § 4 of the

FAA require. As for § 16(a)(2), it applies only when an “in‐

junction against arbitration” exists. 9 U.S.C. § 16(a)(2). Be‐

cause defendants cannot make that showing, they lack

jurisdiction under that statute.

Second reason. “A pro‐arbitration decision, coupled with a

stay (rather than a dismissal) of the suit, is not appealable.”

Moglia v. Pac. Employers Ins. Co. of N. Am., 547 F.3d 835, 837

(7th Cir. 2008) (citing Green Tree Fin. Corp., 531 U.S. at 87 n.2

(holding same)). Indeed, in Moglia we held “9 U.S.C. § 16(b)

positively forbids appeal.” Id. (emphasis in original). Section

16(b) says “an appeal may not be taken” from an order stay‐

ing litigation in favor of arbitration “[e]xcept as otherwise

provided in [§] 1292(b),” which allows an appeal of control‐

ling questions by joint permission of the district and appellate

courts. Moglia, 547 F.3d at 837. Here, defendants appeal a pro‐

arbitration decision in a stayed lawsuit without a § 1292(b)

certification. Yet defendants did not request to certify their

appeal, and seven months have passed since the date of the

contested order. See Richardson Elecs., Ltd. v. Panache Broad. of

Pa., Inc., 202 F.3d 957, 958 (7th Cir. 2000) (holding a two‐

month delay in making § 1292(b) request “was sufficient

grounds for us to refuse our permission to appeal” and that

“a district judge should not grant an inexcusably dilatory

Case: 19-2123 Document: 50 Filed: 02/24/2020 Pages: 22
Nos. 19‐2111 & 19‐2123 17

request”). Therefore, defendants present the same type of ap‐

peal considered—and rejected—in Moglia.

Third reason. Section 16(b) of the FAA supersedes

§ 1292(a)(1) for orders to arbitrate. Moglia, 547 F.3d at 837. Sec‐

tion 16(b)(2) says: “Except as otherwise provided in section

1292(b) of title 28, an appeal may not be taken from an inter‐

locutory order ... directing arbitration to proceed under sec‐

tion 4 of this title.” As for § 1292(a)(1), it generally grants

jurisdiction to courts of appeals over “[i]nterlocutory orders

of the district courts of the United States ... granting ... in‐

junctions.” “[I]t is a commonplace of statutory construction

that the specific governs the general.” Morales v. Trans World

Airlines, Inc., 504 U.S. 374, 384 (1992). Relevant here, the Sixth

Circuit has explained:

Section 1292(a) generally provides for immedi‐

ate appeals of injunctions, while § 16 specifically

forecloses appeals of pro‐arbitration interlocu‐

tory orders. We know that § 16 is the more spe‐

cific provision because it directly addresses the

issue—arbitration‐related appeals—and be‐

cause its exception for § 1292(b) shows that the

statute reflects (and limits) the pre‐existing rules

for appeals. See 9 U.S.C. § 16(b). That means

“[o]ther possible sources of appellate jurisdic‐

tion, including ... § 1291 (final decisions in civil

suits), and § 1292(a) (injunctions), are superseded

for orders to arbitrate.” Moglia, 547 F.3d at 837[.]  

. . . .  

. . . If our § 1292(a) appellate jurisdiction over

injunctions remained unaffected by § 16, even

Case: 19-2123 Document: 50 Filed: 02/24/2020 Pages: 22
18 Nos. 19‐2111 & 19‐2123

the most clumsy litigants could delay an arbi‐

tration and drive up costs with procedural fenc‐

ing. All they would have to do is ask for an

injunction—any injunction—other than one en‐

joining the arbitration itself. The district court

would have to rule on it. And any denial would

invoke ourjurisdiction by the terms of § 1292(a).

... Congress deserves more credit than to have

created such a two‐faced regime—carefully re‐

stricting appeals from arbitration decisions in

one direction, then indulging all manner of ap‐

peals in the other.

Preferred Care of Del., Inc. v. Estate of Hopkins by and through

Hopkins, 845 F.3d 765, 769–70 (6th Cir. 2017). We agree with

the Sixth Circuit’s reasoning and hold that the more specific

appellate‐review provisions of § 16(b) control over

§ 1292(a)(1), which is a general statute governing appellate ju‐

risdiction. Because defendants lack a § 1292(b) certificate from

the district court, § 1292(a)(1) offers them no help here.

Defendants also contend § 16(a)(3) of the FAA, which

grants appellate jurisdiction over “a final decision,” gives

them a jurisdictional foothold. We disagree. The district court

kept the lawsuit open to address arbitration‐related issues, in‐

cluding arbitration venue and whether grounds existed to

grant a permanent injunction. We cannot conclude the district

court left “nothing more for the court to do but execute the

judgment,” Green Tree Fin. Corp. 531 U.S. at 86, as needed to

qualify the arbitration order as a final decision.

In addition to the final decision requirement, Rule 58 of

the Federal Rules of Civil Procedure instructs that “[e]very

judgment ... must be set out in a separate document.” Indeed,

Case: 19-2123 Document: 50 Filed: 02/24/2020 Pages: 22
Nos. 19‐2111 & 19‐2123 19

in a declaratory judgment action like this one, we have in‐

structed that “Rule 58 ... says that the judgment must appear

on a separate piece of paper—separate, that is, from the

court’s opinion. We take this requirement seriously.” Alpine

State Bank v. Ohio Cas. Ins. Co., 941 F.2d 554, 558 (7th Cir. 1991)

(citations omitted); see also Wisconsin Cent. Ltd. v. TiEnergy,

LLC, 894 F.3d 851, 854 (7th Cir. 2018) (“Rule 58’s ‘separate doc‐

ument’ requirement is important because it keeps jurisdic‐

tional lines clear.”). Here, the record contains no judgment

separate from the district court’s order. So we take this oppor‐

tunity to remind bench and bar that if a judgment is intended

to be issued pursuant to Rule 58, a court “must declare specif‐

ically and separately the respective rights of the parties, not

simply state in a memorandum opinion, minute order, or a

form prescribed for judgment in a civil case that a motion has

been granted or denied.” Calumet River Fleeting, Inc. v. Int’l

Union of Operating Engineers, Local 150, AFL‐CIO, 824 F.3d 645,

651 (7th Cir. 2016) (quoting Alpine State Bank, 941 F.2d at 558).

Without a final decision, § 16(a)(3) of the FAA does not of‐

fer a path to appellate jurisdiction. To hold otherwise in this

case would “undermine[] efficient judicial administration and

encroach[] upon the prerogatives of district court judges, who

play a special role in managing ongoing litigation.” Mohawk

Indus., Inc. v. Carpenter, 558 U.S. 100, 106 (2009) (emphasis

added) (citations and internal quotation marks omitted). That

“special role” segues to our next issue.

B

District courts are not helpless in the face of premature ap‐

peals. True, the filing of a notice of appeal generally confers

jurisdiction with the court of appeals and divests the district

court of jurisdiction over certain related matters. See Griggs v.

Case: 19-2123 Document: 50 Filed: 02/24/2020 Pages: 22
20 Nos. 19‐2111 & 19‐2123

Provident Consumer Disc. Co., 459 U.S. 56, 58 (1982). But we

have explained this rule has several qualifications, “perhaps

the foremost of which is that an appeal taken from an inter‐

locutory decision does not prevent the district court from fin‐

ishing its work and rendering a final decision.” Wis. Mut. Ins.

v. United States, 441 F.3d 502, 504 (7th Cir. 2006) (citations

omitted). This allowance extends to “appeals from orders that

are non‐final because of the district court’s oversight.” Id. (ci‐

tation omitted). In Wisconsin Mut. Ins., we held that premature

notices of appeal did not oust the district court of its “jurisdic‐

tion [to] patch[] up the judgment to allow appellate review.”

Id. at 505. That holding applies here.

The filing of a notice of appeal does not automatically di‐

vest a district court’s jurisdiction in all respects, as the district

court here cautiously presumed. “Jurisdiction is not a unitary

concept. ... The distribution of authority to decide depends

on practical rather than formal considerations.” Apostol v.

Gallion, 870 F.2d 1335, 1337 (7th Cir. 1989). The considerations

in Griggs—preventing conflict among tribunals and the waste

of time and money if the district court changes a judgment

after an appeal has been briefed—“are not implicated by al‐

lowing the district court to enter a proper final decision and

thus permit a pending appeal to go forward.” Wis. Mut. Ins.,

441 F.3d at 504–05. Nor does the rule specified in Griggs oper‐

ate when there is a purported appeal from a non‐appealable

order. JPMorgan Chase Bank, N.A. v. Asia Pulp & Paper Co., 707

F.3d 853, 860 n.7 (7th Cir. 2013) (citations omitted); see also 16A

CHARLES ALAN WRIGHT & ARTHUR R. MILLER, FED. PRAC. &

PROC. JURIS. § 3949.1 (5th ed. 2019) (“The weight of authority

holds that an appeal from a clearly non‐appealable order fails

to oust district court authority.”). Because defendants here at‐

tempted to appeal a non‐appealable arbitration order, the

Case: 19-2123 Document: 50 Filed: 02/24/2020 Pages: 22
Nos. 19‐2111 & 19‐2123 21

district court’s jurisdiction over arbitration‐related issues re‐

mained intact.

One final issue: The district court did not decide whether

the parties’ arbitration agreements relinquished defendants’

purported rights to FINRA arbitration. This threshold ques‐

tion is best left for the district court to decide. See Cranberry

Growers Coop. v. Layng, 930 F.3d 844, 857 (7th Cir. 2019) (ex‐

plaining that we “sparingly” resolve questions for the first

time on appeal). Although we express no opinion on the mer‐

its of this issue, among the circuits that have, the obligation to

arbitrate under FINRA Rule 12200 can be superseded or

waived by specific agreement of the parties.8 Rule 54 of the

Federal Rules of Civil Procedure allows the district court to

fully address the waiver and superseding contract questions.

FED. R. CIV. P. 54(b) (permitting a district court to revisit its

interlocutory decisions “at any time before the entry of judg‐

ment adjudicating all the claims and all the parties’ rights and

liabilities”).

8 See, e.g., Reading Health Sys. v. Bear Stearns & Co., 900 F.3d 87, 90,

102‐03 (3d Cir. 2018) (analyzing the construction of a contract’s forum‐se‐

lection clause—not an arbitration clause—and whether it operated to

waive a customer’s right to arbitrate under FINRA Rule 12200); Goldman,

Sachs & Co. v. City of Reno, 747 F.3d 733, 741 (9th Cir. 2014) (“As a threshold

matter, ... a contract between the parties can supersede the default obliga‐

tion to arbitrate under the FINRA Rules.”); UBS Fin. Servs., Inc. v. Carilion

Clinic, 706 F.3d 319, 328 (4th Cir. 2013) (“[T]he obligation to arbitrate under

FINRA Rule 12200 can be superseded and displaced by a more specific

agreement between the parties.”); In re Am. Exp. Fin. Advisors Sec. Litig.,

672 F.3d 113, 132 (2d Cir. 2011) (“[D]ifferent or additional contractual ar‐

rangements for arbitration can supersede the rights conferred on a cus‐

tomer by virtue of a broker’s membership in a self‐regulating organization

such as FINRA.” (internal brackets omitted)).

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22 Nos. 19‐2111 & 19‐2123

III

Because the arbitration and declaratory judgment order

was not a final decision, we lack jurisdiction over defendants’

appeal, so this appeal is DISMISSED.

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