UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF MICHIGAN

SOUTHERN DIVISION

QUIXTAR INC.,

Case No. 08-14346

Petitioner,

Hon. Gerald E. Rosen

v.

CHRIS BRADY, et al.,

Respondents.

________________________________________________________________/

QUIXTAR INC.,

Case No. 08-14347

Petitioner,

Hon. Gerald E. Rosen

v.

BILLY FLORENCE, et al.,

Respondents.

________________________________________________________________/

ORDER DENYING RESPONDENTS’

MOTION FOR STAY PENDING APPEAL

At a session of said Court, held in

the U.S. Courthouse, Detroit, Michigan

on December 29, 2008 

PRESENT: Honorable Gerald E. Rosen

United States District Judge

In an opinion and accompanying order dated December 17, 2008, the Court

determined that it should not entertain an interlocutory appeal from the rulings in an

ongoing arbitration proceeding in which the parties have been participating since August

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of 2007, and it ordered the Respondents in the two above-captioned cases to resume their

participation in this arbitration proceeding. Respondents have appealed these rulings, and

request through the present motion that the Court stay its December 17 order for

Respondents to return to arbitration until the Sixth Circuit has ruled on their appeal. For

the reasons stated briefly below, the Court declines to grant this relief.

As Respondents observe, the Court is authorized under Fed. R. Civ. P. 62(c) to

stay an award of injunctive relief pending appeal. In deciding whether to do so, the Court

considers, among other factors, whether Respondents have “made a strong showing that

[they are] likely to succeed on the merits” of their appeal. Simon Property Group, Inc. v.

Taubman Centers, Inc., 262 F. Supp.2d 794, 797 (E.D. Mich. 2003). In these cases, the

likelihood of Respondents’ success on appeal turns principally upon the viability of their

arguments on the issue that was dispositive to the Court’s December 17 ruling — namely,

whether a court should engage in interlocutory review of an arbitrator’s decision on the

question of arbitrability, once the parties have submitted this question for the arbitrator’s

determination.

As was the case with their submissions prior to the Court’s December 17 ruling,

Respondents largely fail to address this central issue in their present motion. In a single

paragraph at page 9 of the brief in support of their motion, Respondents contend that one

of the cases relied upon by the Court, Michaels v. Mariforum Shipping, S.A., 624 F.2d

411 (2d Cir. 1980), is factually and legally distinguishable in certain respects. Even

accepting that these distinctions are legally significant, Respondents do not take issue

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with the overarching principle recognized in Michaels and the case law generally —

namely, that courts generally lack the authority to review an arbitrator’s interim decision,

but instead should defer such review until the arbitrator has made a final award. Beyond

their brief discussion of Michaels, Respondents have not provided any affirmative

authority whatsoever in support of their attempt to circumvent this usual rule and secure

an immediate judicial pronouncement on an issue that has been submitted for the

arbitrator’s determination in an ongoing arbitration proceeding. It follows that they have

not established a likelihood of success on appeal.

The remaining factors also militate against a stay of the Court’s December 17

order pending appeal. Respondents can hardly claim an irreparable injury arising from an

order to return to an arbitration proceeding in which they participated for nearly a year

before seeking judicial intervention by a Georgia state court. In contrast, a stay of the

Court’s December 17 order would result in harm to Petitioner and to the public interest,

as it would further prolong an already-protracted arbitration proceeding. The whole point

of the Court’s December 17 ruling was that the parties, having invested considerable time

and resources in the arbitration proceedings, should see this process through to an

(ideally) expeditious end, and only then seek judicial review of the arbitrator’s various

rulings. A stay of December 17 order pending appeal would significantly undermine, if

not altogether defeat, the purpose of the Court’s ruling, and thus will not be granted.

For these reasons,

NOW, THEREFORE, IT IS HEREBY ORDERED that Respondents’ December

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19, 2008 motion for stay pending appeal (docket #76 in Case No. 08-14346, docket #75

in Case No. 08-14347) is DENIED.

s/Gerald E. Rosen 

Gerald E. Rosen

United States District Judge

Dated: December 29, 2008

I hereby certify that a copy of the foregoing document was served upon counsel of record

on December 29, 2008, by electronic and/or ordinary mail.

s/LaShawn R. Saulsberry 

Case Manager

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