*

After receiving briefing in this case, this three-judge panel granted the

Appellees' unopposed motion to waive oral argument. The case is therefore

submitted for disposition on the briefs. See Fed. R. App. P. 34(f); 10th Cir. R.

34.1(A)(2), (G).

FILED

United States Court of Appeals

Tenth Circuit

December 21, 2009

Elisabeth A. Shumaker

Clerk of Court

PUBLISH

UNITED STATES COURT OF APPEALS

TENTH CIRCUIT

SHELL OIL COMPANY; SWEPI L.P.,

f/k/a Shell Western E&P, Inc., KINDER

MORGAN CO2 COMPANY, L.P., f/k/a

Shell CO2 Company, Ltd., MOBILE

PRODUCING TEXAS AND NEW

MEXICO, INC., CORTEZ PIPELINE

COMPANY,

Plaintiffs - Appellees,

v.

CO2 COMMITTEE, INC., 

Defendant - Appellant.

No. 08-2281

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF NEW MEXICO

(D. Ct. No. 2:07-CV-01033-RB-WDS)

Submitted on the briefs:*

John M. Cogswell, Cogswell Law Offices, P.C., Buena Vista, Colorado, for

Appellant.

Kent Sullivan, Matthew J. Salzman, and Brian E. Sobczyk, Stinson Morrison

Hecker LLP, Kansas City, Missouri, for Appellee Cortez Pipeline Company; Mark
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Rodriguez and Gwen Samora, Vinson & Elkins, LLP, Houston, Texas, and

Andrew McCollam, III, McCollam Law Firm, PC, Houston, Texas, for Appellees

Shell Oil Company, Swepi LP, f/k/a Shell Western E&P, Inc., and Kinder Morgan

CO2 Company, L.P., f/k/a Shell CO2 Company, Ltd.; Shannon Ratliff and

Richard A. Fordyce, Ratliff Law Firm, PLLC, Austin, Texas, and Bryan G.

Eberle, Sherman & Howard, LLC, Denver, Colorado, for Appellee Mobil

Producing Texas & New Mexico, Inc.

Before TACHA, HOLLOWAY, and MURPHY, Circuit Judges.

TACHA, Circuit Judge.

The sole issue presented in this appeal is whether the applicability of a res

judicata defense based on a prior arbitration order should be resolved by (1) the

arbitration panel that issued the prior order, or (2) a new arbitration panel chosen

pursuant to the selection process outlined in the parties’ arbitration agreement. 

We have jurisdiction under 28 U.S.C. § 1291, and because we conclude that the

arbitration agreement provides that applicability of the defense must be

determined by a new arbitration panel, we REVERSE the order of the district

court.

I. BACKGROUND

Defendant-appellant CO2 Committee, Inc. (“the Committee”) was created in

2001 to monitor and enforce future-relief provisions of a class action settlement

agreement (“the agreement”) between its members and the plaintiffs-appellees

(collectively, “the plaintiffs”). The agreement contains a binding arbitration
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section which refers all future disputes arising from or relating to the agreement

to arbitration. Additionally, the binding arbitration section contains a panel

selection provision that prescribes the manner in which the Committee and the

plaintiffs select members of the arbitration panels that will resolve their future

disputes. The panel selection provision requires that each party choose one panel

member and that the parties’ chosen members then jointly choose the third

member. 

In 2006, the Committee brought an arbitration complaint in which it alleged

that the plaintiffs’ accounting practices violated the agreement. The parties

selected an arbitration panel pursuant to the panel selection provision, and that

panel (“the original panel”) determined that the plaintiffs had not violated the

agreement. A federal district court then confirmed the original panel’s order and

entered judgment in favor of the plaintiffs on June 21, 2007. 

On October 2, 2007, the Committee filed a second arbitration complaint

against the plaintiffs. This complaint also challenged the plaintiffs’ accounting

practices. Contending that the complaint raised issues that were decided or could

have been decided by the original panel in the prior arbitration proceeding, the

plaintiffs filed suit against the Committee in federal district court seeking a

declaration that the second arbitration complaint was barred by res judicata and

an injunction prohibiting the Committee from further pursuing the second

arbitration complaint. 
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Before the district court resolved the plaintiffs’ suit, it approved a

stipulation agreement between the parties that stayed the second arbitration

proceeding and provided in part: 

All of the parties’ respective rights and obligations concerning the New

Arbitration Proceeding shall be tolled until the resolution of this matter by

the District Court . . . .

In the event that [the court] dismisses the [federal] complaint or rules that

any portion of the arbitration proceeding may go forward, [the Committee]

agrees that Plaintiffs shall have ten (10) days following their receipt of

such ruling in which to submit a response to [the Committee’s] complaint

in the New Arbitration Proceeding, to identify any additional matters to be

arbitrated, and to designate Plaintiffs’ party-appointed arbitrator. 

Plaintiffs reserve the right to appeal any such ruling by the District Court,

and to seek a stay from the District Court or any appellate court of the New

Arbitration Proceeding until such appeal is final.

(emphasis added).

The Committee moved to dismiss the plaintiffs’ complaint, arguing that the

res judicata effect of a prior arbitration order is an arbitrable issue that should be

decided in arbitration, not in court. The district court agreed and granted the

Committee’s motion to dismiss. Thus, in its written order dated May 16, 2008,

the court directed the parties to “proceed with arbitration in accordance with their

arbitration Agreement.” Shell Oil Co. et al. v. CO2 Comm., Inc., No. CIV-07-

1033, at 11 (D.N.M. May 16, 2008).

Thereafter, the plaintiffs filed a motion with the original panel requesting a

determination that the Committee’s second arbitration complaint was barred by

res judicata. The Committee, however, refused to submit the res judicata issue to
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the original panel and threatened to sue its members if they attempted to take any

action in that regard. The plaintiffs then filed a response to the Committee’s

second arbitration complaint in which they objected to the formation of a new

panel, argued that the second arbitration complaint was barred, and conditionally

designated their arbitrator for the new panel. 

The plaintiffs also filed a motion in district court seeking clarification of

the court’s May 16 order. Specifically, the plaintiffs asked the district court to

clarify whether it had intended to refer the res judicata issue to the original panel

or to a new arbitration panel. Accordingly, on October 20, 2008, the district court

issued another written order clarifying that the res judicata issue must be resolved

by the original panel. The district court reasoned that the original panel was

already familiar with the complex facts of the case and was in the best position to

determine the scope of its prior order. Indeed, the district court found that the

formation of a new panel would vitiate the primary purposes of arbitration—the

cost-effective and expeditious resolution of disputes. Finally, the court ruled that

if the original panel determined the second arbitration complaint was not barred,

the merits of the second arbitration complaint should be decided by a new panel

selected pursuant to the panel selection provision.

The Committee now timely appeals from the October 20 order referring the
1

Prior to filing its notice of appeal, the Committee first filed a motion to

reconsider the October 20 order on November 3, the last day it could timely file

that motion. The Committee’s November 3 filing, however, was defective

because it was scanned sideways. The Committee corrected the defect and refiled its motion to reconsider on November 7. While its motion to reconsider was

pending in the district court, the Committee timely filed its notice of appeal from

the district court’s May 16 and October 20 orders. Following that filing, the

district court dismissed the Committee’s motion to reconsider as untimely. Once

the district court dismissed the Committee’s motion to reconsider its notice of

appeal became effective. 

As Plaintiffs point out, many of the Committee’s appellate arguments were

raised for the first time in its motion to reconsider, and the Committee concedes

that its motion to reconsider can be treated as if it were never filed. Accordingly,

we will not examine the timeliness of the Committee’s motion to reconsider nor

any arguments raised for the first time in it. See Pignanelli v. Pueblo Sch. Dist.

No. 60, 540 F.3d 1213, 1217 (10th Cir. 2008) (“We do not review claims on

appeal that were not presented below.”). 

-6-

res judicata issue to the original panel.1

II. DISCUSSION

We review a district court’s interpretation of the Federal Arbitration Act

(“FAA”) de novo. Zink v. Merrill Lynch Pierce Fenner & Smith, Inc., 13 F.3d

330, 333 (10th Cir. 1993). Similarly, we review a district court’s interpretation of

an unambiguous contract de novo. Milk ‘N’ More, Inc. v. Beavert, 963 F.2d 1342,

1345 (10th Cir. 1992). If, however, we determine that the contract is ambiguous

such that the district court relied on extrinsic evidence to guide its interpretation,

we treat that interpretation as factual and only reverse for clear error. Cavic v.

Pioneer Astro Indus., Inc., 825 F.2d 1421, 1423–24 (10th Cir. 1987). 

The FAA provides that:

A written provision in . . . a contract evidencing a transaction involving 
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commerce to settle by arbitration a controversy thereafter arising out of

such contract or transaction . . . or an agreement in writing to submit to

arbitration an existing controversy arising out of such a contract . . shall be

valid, irrevocavble, and enforceable, save upon such grounds as exist at law

or in equity for the revocation of any contract.

9 U.S.C. § 2. This section announces “a liberal federal policy favoring arbitration

agreements.” Howsam v. Dean Witter Reynolds, Inc., 537 U.S. 79, 83 (2002)

(quotations omitted). Accordingly, “arbitration is a matter of contract” in which

courts have a limited role. Id. In that limited role, courts do not have authority to

decide questions explicitly addressed by the arbitration agreement. Id. Rather,

courts are bound by the terms of the agreement and may only decide questions of

arbitrability—that is, whether the parties have agreed to submit a specific dispute

to arbitration—“in the kind of narrow circumstance where contracting parties

would likely have expected a court to have decided the gateway matter.” Id. 

Consistent with this statutory scheme of promoting the resolution of

commercial disputes through arbitration rather than litigation, the FAA expressly

favors the selection of arbitrators by parties rather than courts. Section 5 of the

FAA provides in relevant part, “[i]f in the [arbitration] agreement provision be

made for a method of naming or appointing an arbitrator or arbitrators . . . such

method shall be followed. . . .” 9 U.S.C. § 5. Indeed, Congress has articulated

only three instances in which a court may designate arbitrators: (1) if the

arbitration agreement does not provide a method for selecting arbitrators; (2) if

the arbitration agreement provides a method for selecting arbitrators but any party
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to the agreement has failed to follow that method; or (3) if there is “ a lapse in the

naming of an arbitrator or arbitrators.” Id. 

In this case, the binding arbitration section of the class settlement

agreement states, “[t]he meaning and effect of this Agreement and any and all

disputes, disagreements, or claims . . . arising from or relating in any way to . . .

this Agreement shall be submitted to and decided by binding arbitration pursuant

to the provisions of this section . . . .” Appellant’s App. at 193. The panel

selection provision, which follows in the same section, provides: 

Within ten (10) days after notice by one party to the other of its demand for

arbitration, which demand shall also set forth the matter or matters to be

submitted and the name of its arbitrator, the other party shall name its

arbitrator, identify any additional matter(s) to be submitted, and so notify

the demanding party. Within ten (10) days thereafter the two arbitrators

shall select a third arbitrator.

Id. 

As the district court implicitly recognized, these provisions unambiguously

reflect the parties’ intent that “any and all disputes, disagreements, and claims”

arising out of the class settlement agreement are arbitrable. Such broad and

expansive language clearly encompasses not only the merits of a substantive

arbitration complaint but also the applicability of various defenses to such a

complaint. Indeed, the parties agree to arbitrate not only “claims” but also “any

and all disputes” arising from the class settlement agreement, and the panel

selection clause reinforces this provision by permitting the party served with an
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arbitration demand to identify additional matters—which necessarily includes the

applicability of potential defenses—it wishes the panel to determine.

We disagree, however, with the district court’s interpretation of the

arbitration provisions as providing for a prior panel to resolve, after the fact, a

dispute regarding the res judicata effect of its prior order on a newly submitted

arbitration complaint. The arbitration provisions state that each time a party files

a new arbitration complaint, the parties shall select panel members in the manner

prescribed by the panel selection provision. The fact that one party contends that

the arbitration complaint must be dismissed for raising the same issues already

resolved by a prior arbitration proceeding has no bearing on the panel selection

process in this particular agreement. The agreement is clear: a new panel is

convened each time a party demands arbitration on an arbitrable issue, and there

is no provision establishing any particular panel’s appointment beyond the

resolution of a particular complaint. 

The district court correctly determined that the res judicata effect of the

original panel’s order is an arbitrable issue that should not be decided by a court. 

That issue, however, arises as a defense to the Committee’s second arbitration

complaint, and the panel selection provision requires the formation of a new panel

for each new arbitration complaint. Therefore, by referring the res judicata issue

to the original panel, the district court effectively designated the arbitrators for

that issue in direct contravention of the panel selection provision. 
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Notwithstanding the potential efficiency benefits of having the original panel

determine the precise scope of its own prior order, the district court’s authority to

designate arbitrators was limited by 9 U.S.C. § 5 and the parties’ panel selection

provision. Accordingly, the district court erroneously interpreted the class

settlement agreement and exceeded its limited role under the circumstances when

it referred the res judicata issue to the original panel. 

Finally, the Committee makes a cursory claim for attorneys’ fees. Because

that claim was not adequately presented in the Committee’s opening brief,

however, we will not consider it. See Fed. R. App. P. 28(a)(9) (requiring

appellant’s argument in the opening brief to contain “contentions and the reasons

for them” and “citations to the authorities and parts of the record on which the

appellant relies”); see also Headrick v. Rockwell Int’l Corp., 24 F.3d 1272,

1277–78 (10th Cir. 1994).

 III. CONCLUSION

Under the arbitration agreement in this case, the applicability of the

plaintiffs’ res judicata defense based on a prior arbitration order shall be resolved

by a new arbitration panel chosen pursuant to the selection process outlined in the

parties’ arbitration agreement. We therefore REVERSE the order of the district

court referring the issue to the original panel. The order dismissing the plaintiffs’

complaint is otherwise AFFIRMED. Appellant’s motion to expedite the appeal is

DENIED as moot.