# United States Court of Appeals **For the First Circuit**

No. 01-1122 DEV VRAT GUPTA, Petitioner, Appellant,

v. CISCO SYSTEMS, INC., Respondent, Appellee.

APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MASSACHUSETTS [Hon. Edward F. Harrington, U.S. District Judge ]

Before Lipez, Circuit Judge , Bownes, Senior Circuit Judge , and Barbadoro,* District Judge .

Michael E. Norton , with whom RobinsonMurphy & McDonald , David C. Casey , and Bi ngham Dana LLP were on brief for appellant. Thomas M. Peterson , with whom FranklinBrockway Gowdy , Brian L. Johnsrud , Brett M. Schuman , and Brobeck, Phleger & Harrison LLP were on brief for appellee.December 3, 2001

______________________ *Of the District of New Hampshire, sitting by designation.1 Cisco and Gupta had executed an earlier Employment

Agreement on July 25, 1997, as well as a Proprietary Information and Invention Agreement and agreements concerning stock and stock options. None of these agreements is directly at issue in this case. -3-

BOWNES, Senior Circuit Judge . Petitioner-appellant Dev Vrat Gupta is an engineer and former employee of respondentappellee Cisco Systems, Inc. At issue is the ownership of several million dollars’ worth of stock in Maxcomm Technologies, Inc. , a company Gupta founded while employed by Cisco. An arbitrator issued an award upholding Cisco's right to repurchase the stock, and the District Court for the District of Massachusetts denied Gupta's motion to vacate the award. We affirm the decisions below. I. Background Gupta began working for Cisco in July, 1997. In March, 1998, he founded Maxcomm. Gupta remained employed by Cisco while serving as Maxcomm's President and Chief Executive Officer. On July 17, 1998, the parties signed a Founder’s Agreement in which Gupta, in exchange for financing, gave Maxcommor its successors the right to repurchase Gupta’s shares if he left Maxcomm before January of 2002.

On September 9, 1999, Gupta and Cisco entered into an Employment Agreement. 1The Employment Agreement contained an integration clause providing that the Agreement superceded and-4-

replaced all prior agreements between Gupta and Maxcomm, as well

as Gupta and Cisco, "relating to the subject matter hereof, including, but not limited to, any and all prior employment agreements." The integration clause explicitly excepted certain other agreements, but did not mention the Founder's Agreement. The Employment Agreement also contained an arbitration clause and a choice-of-law provision specifying California law.

Also on September 9, 1999, Gupta signed an amendment to the Founder's Agreement referring to Maxcomm's right to repurchase "unvested shares" in the event of the termination of his employment. The amendment provided, inter alia , that absent shareholder approval Gupta "shall not be entitled to any accelerated vesting of the Shares in connection with the acquisition of the Company by Cisco."

OnSeptember 13, 1999, Cisco acquired Maxcomm. Effective that date, Maxcomm and Cisco entered into a Merger Agreement providing, inter a lia , that Cisco could exercise repurchase rights equivalent to those held by Maxcomm under the Founder's Agreement. Gupta had negotiated that contract on behalf of Maxcomm, with the assistance of counsel.

OnMay 24, 2000, Gupta voluntarily resigned from his employment at Cisco. Cisco repurchased the Maxcomm stock2 The arbitrator cited California law, pursuant to the

choice-of-lawprovision in the Employment Agreement, in support of this analysis. -5- pursuant to the Founder's Agreement and compensated Gupta for the repurchased shares.

The matter proceeded to arbitration in April, 2000. The arbitrator performed a "contextual analysis" in interpreting the contract: she examined several other contracts as well as the plain language of the integration clause to determine the intent of the parties. 2She concluded that the integration cl ause in the Employment Agreement covered only contracts relating to employment; that the Founder’s Agreement did not relate to employment; and hence that the Employment Agreement did not replace or supercede the Founder’s Agreement. Accordin gly, she held that Cisco retained the right to repurchase the Maxcomm stock.

Gupta filed suit under the Federal Arbitration Act, 9 U.S.C. § 10, to vacate the arbitrator's award. On December 19, 2000, the district court affirmed the award. II. Discussion Our review of an arbitrator's decision is “extremely

narrowand exceedingly deferential.” Keeb ler Co. v. Truck Drivers, Local 170 , 247 F.3d 8, 10 (1st Cir. 2001) (citation omitted); Bull HNInfo. Sys., Inc. v. Hutson , 229 F.3d 321, 330-6-

(1st Cir. 2000) (citation omitted). We recently emphasized that “disputes that are committed by contract to the arbitral process almost always are won or lost before the arbitrator. Successful court challenges are few and far between.” Keebler , 247 F.3d at 10 (quoting Teamsters Local Union No. 42 v. Supervalu, Inc. , 212 F.3d 59, 61 (1st Cir. 2000)) (interpreting collective bargaining agreement). Indeed, "judicial review of an arbitration award is among the narrowest known to the law.” Coastal Oil v. Teamsters Local A/W , 134 F.3d 466, 469 (1st Cir. 1998) (citation omitted).

Inthis Circuit, arbitral awards are subject to review only in two relevant instances: (1) where an award is contrary to the plainlanguage of the contract or (2) where it is clear fromthe record that the arbitrator recognized the applicable law , but ignored it. Bull HN Info. Sys. , 229 F.3d at 330-31. "Inthe parlance of this and other circuits, a reviewing court mayvacate an arbitral award if it was made in 'manifest disregard' of the law." Id. at 331. Thus, we will affirm the arbitrator’s interpretation of the Employment Agreement if it is inany way plausible, even if we think she committed serious

error. See Coastal Oil , 134 F.3d at 469; Dorado Beach Hotel Corp. v. Unionde Trabajadores de La Industria Gastronomica de Puerto Rico Local 610 , 959 F.2d 2, 4 (1st Cir. 1992). “[I]t is the arbitrator’s view of the facts and of the meaning of the-7-

contract that [the parties] have agreed to accept." Bull HN Info. Sys. , 229 F.3d at 330 (internal quotation marks omitted).

Gupta maintains that the arbitrator and district court erred in concluding that the Founder’s Agreement did not relate to employment. He contends that the very purpose of that agreement was to secure his continued relationship with Cisco, and points out that his employment was explicitly mentioned several times therein. Thi s argument is not without force. We are constrained, however, by the standard of review. See Wheelabrator Envirotech Operating Serv. Inc. v. Mass. Laborers Dist. Council Local 1144 , 88 F.3d 40, 48 (1st Cir. 1996) (affirming arbitrator’s award even though “as a matter of first impressionwe might well have decided the case otherwise”). Evenif we disagree with the arbitrator's interpretation of the in tegration clause in the Employment Agreement, it does not amount to manifest disregard of the law. See Bull HN Info. Sys. , 229 F.3d at 330-31. The arbitrator's determination that the parties did not intend to cut off Cisco's repurchase rights is sufficiently grounded in the record such that we cannot say it is contrary to the plain language of the Employment Agreement. See id. Nor is this a situation wherein the arbitrator recognized but ignored the applicable law. See id. Hence, we defer to her conclusion that the Employment Agreement-8-

does not supercede or replace the Founder’s Agreement, and affirm the award in favor of Cisco.

Affirmed.