T hi s di s pos i t i on i s notappr opr i a t e f orpubl i c a t i on and i s notpr e c e de nt * e xc e pta s pr ovi de d by N i nth C i r c ui tR ul e 36- 3. NOT F OR P UB L I CAT I ON UN I TE D STATE S C OU RT OF APPE ALS FOR T HE NI NTH CI RC UI T C E N T R A L M O N T A N A R A I L , aM ont a na C o rp o r a tio n , in d iv id u a lly , a n d a s f u ll a s s ig n e e o f

th e S ta te o f

M o n ta n a , o f

a ll ju r is d ic tio n a l a n ds u b s ta n tiv e le g a l r ig h ts th e S t at e o f M o n t an a p o ssesses ag ai n st B N S F R ai l w ayC om pany i n thi s c as e, P la in tif

f - A p p e lla n t, v. BN SF RA I LW A Y CO M PA N Y , BN SF R a i l w a y C om pa ny f

orm e r l y know n a s T he B url i ng t on N orthern and S ant a F e R ai l w ay C om pa ny , aD e l a w a r e C orpor a t i on, D ef

endant- A pp el l ee . N o. 10- 35439 D. C . No . 4 : 0 5 - c v - 0 0 1 1 6 - R KS ME MOR AN DU M *

A pp ea l fr om the U ni t ed S t at es D i stri ctC ou rt f orthe D i s tr i c tof

M ont a na K e i th S tr ong, M a gi s tr a t e J udge , P r e s i di ng A r gue d a nd S ubm i tt e d M a r c h 11, 2011

S e a tt l e , W a s hi ngt on B efo re: F IS H E R , G O U L D , an d T A L L M A N , C i rcu i tJu d g es. 

# FI LED MA R 18 2011 M OLLY C. DW Y ER, CLERK U . S. C O U R T OF APPE ALSB ec ause the fa ct s are kn ow n t o the part i es , w e r epea tthem on l y a s 1 n e c e s s a ry to e x p la in o u rd e c is io n . 2 C e ntr a l M ont a naR a i l , I nc . ( “ C M R ” ) , i ndi vi dua l l y a nd a s f orm e ra s s i gne e of the S t a t e of

M ont a na , appe a l s the di s tr i c tc our t ’ s c onf i rm a t i on of

a n a rbi tr a t i on a w a r d, de ni a l of

C M R ’ s m ot i on t o di s m i s s w i thoutpr e j udi c e , a nd a w a r d of s um m a ry j udgm e nti n f

a vorof B N S F R a i l w a y C om pa ny ( “ B N S F ” ) . W e ha ve j u r i s d i c t i o n p u r s u a n tt o 2 8 U . S. C. § 1 2 9 1 . W e a f f i rm. 1 1 . T h e F e d e r a l A rb itr a tio n A c t ( “F A A ” ) p r o v id e s th a t “ac o u r t ‘m u s t’ confi rm an arbi tra t i on aw ar d ‘ un l es s’ i ti s vac at ed, m od i fi ed, or corr ec t ed ‘ as p r e s c r ib e d ’” b y th e F A A . H al l St . A ss ocs. , L . L . C . v. M at tel , Inc. , 552 U . S . 576, 58 2 (20 08 ) ( qu ot i ng 9 U . S . C . § 9 ). V ac atur i s a vai l abl e “ w here the arbi tra t ors e xc e e de d the i rpow e r s , ors o i m pe r f e c t l y e xe c ut e d the m tha tam utua l , f i na l , a nd d e f in ite a w a r d u p o n th e s u b je c t m a tte rs u b m itte d w a s n o t m a d e .” 9 U .S .C . § 10 (a )( 4). H er e, the cond i t i on s f or vacatur ar e notm et , and the di stri ctcourt pr ope r l y c onf

i rm e d the a w a r d. T he a rbi tr a t or s di d nota c tout s i de of the i rs c ope of author i ty , a s the a w a r d w a s l i m i t e d t o a ns w e r i ng the que s t i ons s ubm i tt e d f or a rb itr a tio n . Se e Mi c h. Mut . I ns . C o. v . U

ni gard Se c . I

ns . C o. , 4 4 F .3 d 8 2 6 , 8 3 0 ( 9 th C i r . 1995) ( s t a t i ng tha ta n a w a r d m a y be ove r turne d “ [ w ] he n a rbi tr a t or s rul e on a m a tt e rnots ubm i tt e d t o the m ” ) . C M R ha s notc ont e s t e d the pr opr i e ty of ha vi ng3

th o se q u es ti o n s s u b m itted b ef o re th e a rb itra to rs b y ap p ea li n g th e d istrict co u rt’s order com pel l i ng arbi tra t i on . N or i s i t“ cl ea r f rom the re cord thatthe arbi tra t ors re cogn i ze d the appl i cabl e l aw and then i gn ored i t , ” a s i s r equi re d t o v ac at e a n a w a r d f o rm a n if e s t d is r e g a r d o f

th e la w . I

d. a t 8 3 2 . G iv e n th e “lim ite d a n d h ig h ly d e f e r e n tia l” r e v ie w o f

arb itr a tio n a w a r d s , P o w erA g en t In c. v. E lec. D a ta S

ys. C or p. , 35 8 F . 3d 11 87 , 11 93 (9th C i r. 20 04 ) ( i nt ernal qu ot at i on m arks om i tt ed), C M R ’ s “ m e r e a l l e ga t i ons of e rr ora r e i ns uf

f i c i e nt ” t o m e r i tva c a t i ng the a w a r d, C ol l i ns v. D . R . H

orton , Inc. , 505 F . 3d 874, 879 ( 9th C i r . 2007) ( i nt e rna l quot a t i on m arks del et ed). 2. W he n rul i ng on am ot i on t o di s m i s s w i thoutpr e j udi c e br ought p u rsu an tt o F ed eral R u l e o f C i v i l P ro ced u re 4 1 (a)(2 ), “ th e d i stri ctco u rtm u st d e te rm in e w h e th e rth e d e f e n d a n t w ill s u f

f e rs o m e p la in le g a l p r e

ju d ic e a s ar e s u lt of the di sm i ss al . ” W

es t lan ds W

at erD ist. v. U

ni ted Stat es , 1 0 0 F .3 d 9 4 , 9 6 ( 9 th C ir . 1 9 9 6 ) ; se e F ed. R . C i v. P . 41 (a )( 2). H er e, the di stri ctcourtconsi dere d pe rm i s s i bl e f

a c t or s i n a s s e s s i ng pr e

j udi c e a nd de ny i ng C M R ’ s R ul e 41( a ) ( 2) m ot i on. T he di s tr i c tc our tnot e d tha t , i f i tha d di s m i s s e d the a c t i on w i thout pr e j udi c e , B N S F c oul d f

a c e l i t i ga t i on i n s t a t e c our tof ac l a i m tha tha d r e a c he d the s u m m a ry ju d g m e n t s ta g e in f e d e r a l c o u r t, a f

te ra lm o s t f

o u ry e a r s o f

litig a tio n . C M R has gi ven n o exp l anat i on for w hy i tdel ay ed so l on g i n request i ng vo l un t ary4

d is m is s a l. C

f. W e s tla n d s W a te rD is t. , 10 0 F . 3d at97 (f i nd i ng l ac k o f l egal pr e j udi c e w he r e pl a i nt i f

f s f i l e d am ot i on f

orvol unt a ry di s m i s s a l w i thi n am onth of f a i l i ng t o obt a i n apr e l i m i na ry i nj unc t i on a nd be f or e de f e nda nt s f i l e d m ot i ons f

or s um m a ry j udgm e nt ) . B N S F w oul d a l s o be de ni e d af e de r a l f orum w e r e the m ot i on g r a n te d . Se e i d. ( “[ I ]n d e te rm in in g w h a t w ill a m o u n t to le g a l p r e ju d ic e , c o u r ts have exam i ned w hether adi sm i ss al w i tho utprej ud i ce w ou l d res ul ti n the l oss of a f e de r a l f orum [ . ] ” ) . T he di s tr i c tc our t ’ s c onc l us i on tha tthe R ul e 41( a ) ( 2) m ot i on w a s m o tiv a te d b y f

o ru m s h o p p in g h a s s u p p o r t in th e c ir c u m s ta n c e s h e r e . See Kern O i l & R e f i ni ng C o. v . T

e nne c o O i l

C o. , 792 F . 2d 1380, 1389–90 ( 9th C i r . 1986) ( uphol di ng af

i ndi ng of f orum s hoppi ng w he r e pl a i nt i f f s oughtdi s m i s s a l w i thout pr e j udi c e of ac l a i m i n or de rt o ha ve i the a r d be f or e adi f f e r e ntc our t ) . B e c aus e the di s tr i c tc our t ’ s a s s e s s m e ntof l e ga l pr e j udi c e a nd i t s de ni a l of

C M R ’ s R ul e 41( a ) ( 2) m ot i on for vol un t ary di sm i ss al w er e notbase d o n an err on eous vi ew of the l aw or a c l e a r l y e rr one ous a s s e s s m e ntof the f a c t s , the c our tdi d notabus e i t s di s c r e t i on. See W e s tla n d s W a te rD is t. , 100 F . 3d a t96. 3 . T h e d i s tr i c tc o u r tp r o p e r l y g r a n t e d s u m m a ry j u d g m e n t , w h i c h C MR f a i l e d t o oppos e , a f

t e rc onc l udi ng tha t( 1) C M R c a nnotr e c ove rda m a ge s unde rthe S ett l em entA gree m entbecause thatagre em ent ’ s e xp re ss t erm s f orbi d thi rd part i es f r o m r e c o v e r in g a n d ( 2 ) th e S ta te ’s a lle g e d h ig h w a y d a m a g e s a r e n o t r e c o v e r ab le5

u n d er M o n t an a l aw g o v ern i n g co n tractu al b reach . C M R d o es n o tch al l en g e th ese concl usi on s or the l egal anal ys i s s up po rt i ng them . Inst ea d, C M R po i nt s t o a se ri es of pu rport edl y i ncorrec t l y det erm i ned fact s on w hi ch i tcl ai m s the di stri ctcourt b a s e d its d e c is io n . T h e d is tr ic t c o u r t’s a w a r d o f s u m m a ry ju d g m e n t, h o w e v e r , d id n o t tu rn o n a n y o f

th e p u rp o r te d f

a c ts th a t C M R c ite s a s d is p u te d o re rr o n e o u s ly de c i de d. C M R , a c t i ng on i t s ow n be ha l f a nd a s a s s i gne e of

the S t a t e of

M ont a na throu gh ou tthe bu l k o f the l i t i gat i on , has notappeal ed the di stri ctcourt ’ s order c om pe l l i ng a rbi tr a t i on, a nd C M R doe s nota r t i c ul a t e w ha tothe rda m a ge s w oul d be a v a ilab le b e y o n dth o s e th e d is tr ic t c o u r t h e ld u n a v a ilab le a s am a tte ro f la w . B ecau se th ere are n o g en u i n e i ssu es o f m at eri al factp recl u d i n g j u d g m en tas a m a tte ro f la w , th e d is tr ic t c o u r t’s g r a n t o f s u m m a ry ju d g m e n t w a s c o rr e c t. See F ed. R . C i v. P . 56 (c ). AF F I RME D.