* Of the United States District Court for the District of

Columbia, sitting by designation.

United States Court of Appeals

For the First Circuit

No. 03-1578

PAUL COZZA,

Plaintiff, Appellee,

v.

NETWORK ASSOCIATES, INC.,

Defendant, Appellant.

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF MASSACHUSETTS

[Hon. Richard G. Stearns, U.S. District Judge]

Before

Torruella, Circuit Judge,

Cyr, Senior Circuit Judge,

and Oberdorfer,* Senior District Judge.

Clifton T. Hutchinson, with whom David J. Schenck and Hughes

& Luce, LLP, were on brief, for appellant.

Joseph L. Stanganelli, with whom Anthony A. Scibelli and

Scibelli and Whiteley, LLP, were on brief, for appellee.

March 22, 2004
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TORRUELLA, Circuit Judge. Defendant-appellant Network

Associates, Inc. ("NAI") appeals the district court's denial of its

Motion for Reconsideration of Motion to Compel Arbitration. After

careful review, we affirm.

I. Background

In 1993, plaintiff-appellee Paul Cozza ("Cozza") and

Datawatch (subsequently acquired by NAI) entered into an Antiviral

Scan Enhancement License Agreement (the "License") for the use of

Cozza's patented scan enhancement technology. Disputes arose over

royalties and, on August 26, 1999, Cozza and NAI entered into a

Settlement Agreement (the "Settlement"), which involved, inter

alia, a payment to Cozza for a license to use his technology until

December 31, 2001, after which NAI was to remove Cozza's technology

from its products.

The License, which contained a clause agreeing to

arbitrate "any dispute or controversy regarding the subject matter

of this Agreement," terminated on December 31, 2001. The

Settlement, which contained no arbitration clause, has been in

effect since 1999.

On June 6, 2002, Cozza brought this diversity action

against NAI for breach of the Settlement, fraud, and other state

law claims, alleging that NAI failed to remove Cozza's technology

from products that it continued to sell, despite the Settlement's

prohibition of any further sales after December 31, 2001. On
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September 6, 2002, NAI filed a motion to compel arbitration

pursuant to the Federal Arbitration Act, 9 U.S.C. § 4 ("FAA"),

arguing that the controversy was governed by the arbitration clause

in the License. On October 17, 2002, the district court denied

NAI's motion, concluding that, regardless of whether the License's

arbitration clause survived the License's termination, the

complaint did not assert any breach of the License, and because

Cozza had made binding representations that he had not, and would

not, assert any claims under the License, the arbitration clause

did not apply and Cozza could not be compelled to submit to

arbitration.

NAI did not appeal the denial of the motion to compel

arbitration, despite the FAA's explicit provision for interlocutory

appeals of such denials. 9 U.S.C. § 16(a)(1)(B).

Discovery ensued and proceeded contentiously. After a

failed mediation attempt in February 2003, NAI deposed Cozza on

March 13 and 14, 2003. On April 7, 2003, in response to various

discovery motions, the district court allowed NAI's motion for a

protective order, subject to certain conditions, and allowed, in

part, Cozza's motion to compel supplemental answers to

interrogatories.

On April 11, 2003, NAI filed the "Motion for

Reconsideration of Motion to Compel Arbitration" at issue in this

appeal, alleging that Cozza's March deposition had revealed that
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Cozza's claims did in fact involve the License in such a way as to

bring them within its arbitration clause, despite his prior

representations to the contrary. The district court summarily

denied the motion on April 22, 2003.

On April 25, 2003, NAI filed a Notice of Appeal, as well

as an emergency motion to stay the district court proceedings

pending appeal. The district court granted the motion to stay. On

April 30, 2003, Cozza filed a motion to strike the Notice of Appeal

and to lift the stay, arguing that such an appeal had to be filed

within thirty days of the district court's October 17, 2002, order

denying NAI's initial motion to compel arbitration and that NAI

cannot now appeal either the October 2002 order or the denial of

its motion for reconsideration. On May 21, 2003, this court denied

Cozza's motion and directed the parties "to address [the] court's

jurisdiction in their briefs, including whether appellant's motion

for reconsideration below can properly be construed as a renewed

motion to compel arbitration based on newly discovered evidence,

and whether an interlocutory appeal would lie from the granting or

denial of such a motion."

NAI argues that the plain language of § 16(a)(1)(B) of

the FAA, which states that "[a]n appeal may be taken from an order

denying a petition . . . to order arbitration to proceed,"

indicates that all interlocutory orders denying arbitration,

including the denial of their "motion to reconsider," can be
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appealed at any time before a final judgment is issued. NAI

contends that this proposed "FAA exception" comports with

Congress's purpose to favor arbitration.

Cozza argues that similar reasoning has been rejected in

the context of qualified immunity, where the thirty-day deadline to

appeal interlocutory orders under Federal Rules of Appellate

Procedure 4(a)(1) has been enforced, and appeals of orders denying

reconsideration "cannot resurrect a party's expired right to

contest the appropriateness of the order underlying the motion."

Fisichelli v. The City Known as the Town of Methuen, 884 F.2d 17,

19 (1st Cir. 1989). Otherwise, "Rule 4(a)(1) would be stripped of

all meaning; . . . and a dilatory defendant would receive not only

his allotted bite at the apple, but an invitation to gnaw at will."

Id. We begin by addressing this jurisdictional quandary.

II. Analysis

Focusing on NAI's claims of new evidence, the

appealability of the motion could be contemplated within the

context of Rule 60(b) motions based on newly discovered evidence.

"Ordinarily, the denial of a Rule 60(b) motion is immediately

appealable since there is nothing left to do in the district

court." Xerox Fin. Servs. Life Ins. Co. v. High Plains Ltd.

P'ship, 44 F.3d 1033, 1038 (1st Cir. 1995). The district court

proceedings are still underway here, however, which "raises

interesting questions about the appealability of a Rule 60(b)
1 This court has recently expressed sympathy, in dicta, for the

view of several of our sister circuits that, although nothing in

the text of the FAA requires immediate appeal of interlocutory

orders denying arbitration, "the failure to promptly appeal such a

denial may by estoppel foreclose the demanding party's right to

arbitration, although this is not automatic and depends on a

showing of prejudice to the other side." Colón v. R.K. Grace &

Co., 358 F.3d 1, 4 (1st Cir. 2003). The reasoning behind such a

rule is that "it is wasteful to have a full trial and then

determine by a post-trial appeal that the whole matter should have

been arbitrated and so start again." Id. In the case before us,

however, there has been no trial, and whether the discovery that

occurred was sufficiently prejudicial to Cozza to warrant

forfeiture is far from clear.

 The issue is further complicated by NAI's claim that the second

motion is based on newly discovered evidence that was not available

before the expiration of the thirty-day period allowed by this rule

for interlocutory appeal of his initial motion to compel

arbitration. Refusing to allow an appeal of a second motion to

compel arbitration based on newly discovered evidence supporting

the arbitrability of the dispute potentially creates exactly the

scenario a forfeiture rule seeks to avoid: a full trial followed by

a determination that the matter must be arbitrated. Perhaps such

a case, like Colón, "is a perfect example of why one would not

employ a mechanical forfeiture rule." Id.

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denial in the context of an ongoing district court proceeding."

Id.

While recognizing that the novel jurisdictional issue

before us raises several such interesting questions,1 their

consideration can await another day. The rule is well established

in this Circuit that resolution of a complex jurisdictional issue

may be avoided when the merits can easily be resolved in favor of

the party challenging jurisdiction. Restoration Pres. Masonry,

Inc. v. Grove Europe Ltd., 325 F.3d 54, 59 (1st Cir. 2003)(citing

cases holding that jurisdictional inquiry is not required unless
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Article III case or controversy requirement is implicated). Here,

even assuming arguendo that NAI's motion can be construed as a

renewed motion to compel arbitration based on new evidence and that

appellate jurisdiction would exist over the denial of such a

motion, the matter can be easily resolved in Cozza's favor, as the

record fails to provide support for NAI's assertion that new

evidence supporting arbitration emerged in Cozza's deposition.

NAI argues that all of Cozza's claims are arbitrable

because they "regard" Cozza's scan enhancement technology, which

NAI identifies as the subject matter of the License, and Cozza

agreed in the License to arbitrate "any dispute or controversy

regarding the subject matter of this Agreement." NAI alternatively

asserts that the arbitration clause survived the termination of the

contract, that the Settlement incorporated the License, or, if the

License is not incorporated in the Settlement, precedent indicates

that the settlement of an arbitrable dispute is also arbitrable.

All of these arguments were available to NAI when it

brought its first motion to compel arbitration and all were argued

at that time, when the opportunity to appeal the motion's denial

under the FAA was undeniable. NAI implicitly acknowledges this by

refraining from reiterating those arguments in the second motion

and simply incorporating the first motion by reference. Whatever

the merits vel non of NAI's argument that another interlocutory

appeal should lie from the denial of a motion to compel arbitration
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based on new evidence, NAI cannot seriously argue any entitlement

to bring successive interlocutory appeals based upon the same

arguments, nor to appeal arguments which it could have appealed

earlier, but did not. NAI's success thus depends on the alleged

"newly discovered evidence" supporting these arguments.

The evidence NAI identifies as "newly discovered" in

Cozza's deposition testimony involves a discussion of the possible

method for calculating damages and references to allegedly false

statements made in 1999 by three NAI employees during the

negotiation of the Settlement. NAI refers to Cozza's "theory" that

NAI "unilaterally extended" the License by not removing his

technology and that thus damages "would be what was due according

to the license agreement." These references, however, are embedded

within a longer answer to the question of whether, as part of his

claim for damages, Cozza thought he should be entitled to a

percentage of the sales of NAI products containing his technology.

Cozza responded that "we believe that, at a minimum, because

Network Associates has unilaterally extended the license agreement,

on its own terms, using the scan enhancement for however long they

would like to use it, that at a minimum we should get what would

have been required in the licensing agreement." Cozza was simply

speculating that one factor the court might consider in assessing

damages under the Settlement might be the fees that would have been

due under the License.
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Cozza's references to the allegedly false statements of

NAI employees, while concerning conversations that occurred before

the termination of the License, were made in connection with

Cozza's claim that NAI engaged in unfair and deceptive practices in

negotiating the Settlement. The mere fact that the Settlement was

negotiated prior to the License's termination does not indicate

that the claims Cozza makes regarding those negotiations implicate

the License. Similarly, NAI refers to Cozza's statement that "from

the very beginning until this day, Network Associates has acted to

defraud me in various ways and at various times" as indicative of

the reach of Cozza's claims to the parties' relationship under the

License, when in fact the ensuing testimony clarifies that the

misleading or deceptive behavior of which Cozza complains is that

involved in the negotiation of the Settlement.

When Cozza was asked during the deposition if he was

making any claim based on or arising out of the License, he stated

that "[t]he settlement agreement was a settlement of disputes

arising out of the license agreement, and we are litigating because

of breach of contract of the settlement agreement. So, indirectly

there is something to do with the issues arising out of the license

agreement." When asked to clarify this comment by identifying how

the License bears on his claim, he responded that one way would be

in respect to damages. After further testimony regarding the

possible role of the License in calculating damages, substantially
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identical to that already discussed herein, Cozza was asked if he

is seeking to enforce any provision of the License directly or

indirectly, to which he responded: "We are not making any claims in

the litigation based upon the license agreement." He proceeded to

comment further that "by suing in the settlement -- according to

the breach of contract, in the settlement agreement, depending on

how you construe that, you could say, well, it may be indirectly

some provision of the license agreement that's being fulfilled or

something by the virtue of this suit on the breach of the

settlement agreement." Regardless of these theoretical musings,

which NAI would have us read as indicative of an intention to raise

claims regarding the License, nothing in the record calls into

question Cozza's initial response that he is "not making claims in

the litigation based upon the license agreement."

None of the "newly discovered evidence" alleged by NAI

constitutes new evidence supporting a motion to compel arbitration.

It is "all too clear that defendants are seeking to accomplish by

indirection what their own inaction now prevents them from doing

directly: contesting, before trial, the appropriateness of the

district court's earlier denial of their motion." Fisichelli, 884

F.2d at 19. We therefore need not, and do not, address the merits

of NAI's argument that the district court erred in its

interpretation of the Licensing Agreement.
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III. Conclusion

The district court's denial of the motion to reconsider

the motion to compel arbitration is affirmed.

Affirmed.