Source: http://openjurist.org/670/f2d/377
Timestamp: 2017-06-22 17:55:01
Document Index: 301832742

Matched Legal Cases: ['§ 1291', '§ 1292', '§ 1292', '§ 4', '§ 4', '§ 4', '§ 4', '§ 1292']

670 F. 2d 377 - Acton Corporation v. Borden Inc HomeFederal Reporter, Second Series 670 F.2d.
Ordinarily, a decision by a district court to stay litigation before it pending developments in a different action involving the same issues is not appealable. Such a highly discretionary "stay" decision, Landis v. North American Co., 299 U.S. 248, 254-55, 57 S.Ct. 163, 165-166, 81 L.Ed. 153 (1936), is neither "final" nor equivalent to an "injunction." It thus provides no basis for an appeal under either § 1291 or § 1292(a). Harmon-Kardon, Inc. v. Ashley Hi-Fi, 602 F.2d 21, 22 (1st Cir. 1979); Codex Corp. v. Milgo Electronic Corp., 553 F.2d 735, 737 (1st Cir. 1977); 9 Moore's Federal Practice, P 110.20(4.-2) at 249, 250.
First, there are "collateral order" cases, which allow an appeal where there is an "important claim of right 'separable from, and collateral to' rights asserted in the main cause of action which may be lost if appellate consideration is delayed...." New England Power Co. v. Asiatic Petroleum Corp., 456 F.2d at 185 (quoting Cohen v. Beneficial Industrial Loan Corp., 337 U.S. 541, 546, 69 S.Ct. 1221, 1225, 93 L.Ed. 1528 (1949)). We find this exception inapplicable because we find no important separable right likely to be lost. The only injury that inability to appeal can inflict upon Acton is the need to litigate the issues of arbitrability in a different federal court. Of course, litigation in a different forum can lead to the appointment of an arbitrator in a different district.6 But, the contract between the parties does not specify where the arbitration is to be held-a fact indicating that the parties did not consider location of the arbitral forum important enough to make it a contractually protected right. Cf. Aaacon Auto Transport, Inc. v. Ninfo, 490 F.2d 83, 84 (2d Cir. 1974). Moreover, we have found nothing in the Federal Arbitration Act or its history sufficient to convince us that "choice of forum," at least where not mentioned specifically in the contract, is an important enough interest to qualify for "collateral order" protection. Cf. Piper Aircraft Co. v. Reyno, --- U.S. ----, 102 S.Ct. 252, 70 L.Ed.2d 419 (1981); USM Corp. v. GKN Fasteners, Ltd., 574 F.2d 17, 20-21 (1st Cir. 1978); New England Power Co. v. Asiatic Petroleum Corp., 456 F.2d at 185. Rather, in this instance, the interest in the speedy, efficient conduct of litigation-which here counsels against interlocutory appeals-outweighs the occasional need to correct speedily a district court decision banishing a litigant to an improper forum.
Fourth, appeals have sometimes been allowed from stay orders entered in suits where a party has sought preliminary injunctive relief. See, e.g., Goldberg v. Carey, 601 F.2d 653 (2d Cir. 1979); Glen Oaks Utilities, Inc. v. City of Houston, 280 F.2d 330 (5th Cir. 1960). The theory seems to be that the stay operates as a denial of the preliminary relief sought, see Goldberg v. Carey, 601 F.2d at 657-58; Glen Oaks Utilities, Inc. v. City of Houston, 280 F.2d at 333; and is therefore appealable under 28 U.S.C. § 1292(a)(1) as the denial of an interlocutory injunction. This theory is inapplicable here, however, for courts have specifically written that a proceeding to compel arbitration under 9 U.S.C. § 4 is not a suit for "injunctive" relief; rather they have called it a suit for a "unique statutory remedy," John Thompson Beacon Windows, Ltd. v. Ferro, Inc., 232 F.2d at 369; Lummus Co. v. Commonwealth Oil Refining Co., Inc., 297 F.2d at 85. And, the "practical consequence" of applying this exception here, cf. Goldberg v. Carey, 601 F.2d at 657-58, would be to reverse in "section 4" cases the general presumption against stay appealability. We have found no good reason for doing so.
Mandamus is suitable as a remedy, however, only in "extraordinary situations." Kerr v. United States District Court, 426 U.S. 394, 402, 96 S.Ct. 2119, 2123, 48 L.Ed.2d 725 (1976). It "has traditionally been used in the federal courts only 'to confine an inferior court to a lawful exercise of its prescribed jurisdiction or to compel it to exercise its authority when it is its duty to do so.' " Will v. United States, 389 U.S. 90, 95, 88 S.Ct. 269, 273, 19 L.Ed.2d 305 (1967) (quoting Roche v. Evaporated Milk Association, 319 U.S. 21, 26, 63 S.Ct. 938, 941, 87 L.Ed. 1185 (1943)). Although the use of mandamus has not been limited by "an unduly narrow and technical understanding of what constitutes a matter of 'jurisdiction,' " Kerr v. United States District Court, 426 U.S. at 402, 96 S.Ct. at 2123 (citing Will v. United States, 389 U.S. at 95, 88 S.Ct. at 273), it is well-settled that "only exceptional circumstances amounting to a judicial 'usurpation of power' will justify the invocation of this extraordinary remedy." Will v. United States, 389 U.S. at 95, 88 S.Ct. at 273; Debeers Consol. Mines, Ltd. v. United States, 325 U.S. 212, 217, 65 S.Ct. 1130, 1132, 89 L.Ed. 1566 (1945); In re Arthur Andersen & Co., 621 F.2d 37, 38-39 (1st Cir. 1980). The party seeking mandamus has "the burden of showing that its right to issuance of the writ is 'clear and indisputable.' " Bankers Life & Cas. Co. v. Holland, 346 U.S. 379, 384, 74 S.Ct. 145, 148, 98 L.Ed. 106 (1953) (quoting United States v. Duell, 172 U.S. 576, 582, 19 S.Ct. 286, 287, 43 L.Ed. 559 (1899)). See Kerr v. United States District Court, 426 U.S. at 403, 96 S.Ct. at 2124; USM Corp. v. GKN Fasteners, Ltd., 574 F.2d at 23. It is plain to us that Acton has failed to satisfy that burden here.
Borden's Ohio action contained a demand that Acton be compelled to abide by a decision of Arthur Andersen. Acton's later suit in Massachusetts sought to compel arbitration with an arbitrator selected by lot. The claims in the two suits were overlapping (in that the parties each sought arbitration) but not identical (in that each party sought arbitration with a different arbitrator). Both suits, however, fairly raised the issue of whether or not Acton's accountant had agreed to the appointment of Arthur Andersen. That issue had to be decided before either court could order arbitration. To avoid duplication of effort and potentially inconsistent judgments, it stands to reason that one of the two courts should defer to the other. See Kerotest Mfg. Co. v. C-O-Two Fire Equipment Co., 342 U.S. 180, 183-84, 72 S.Ct. 219, 221, 96 L.Ed. 200 (1952); Washington Metropolitan Area Transit Authority v. Ragonese, 617 F.2d 828 (D.C.Cir.1980); Small v. Wageman, 291 F.2d 734 (1st Cir. 1961). Cf. Landis v. North American Co., 299 U.S. 248, 254, 57 S.Ct. 163, 165, 81 L.Ed. 153 (1936).
The cases relied upon by Acton are not to the contrary. In Aaacon Auto Transport, Inc. v. Ninfo, supra, the Second Circuit stated that a New York district court "lacked the power" to transfer a § 4 suit to a more convenient federal forum in Wisconsin. The Second Circuit's decision, however, rested not only on the fact that "the petition (for arbitration) was filed in ... New York," but also on the fact that the underlying contract "on its face provides for arbitration in New York...." Id. at 85. Even if the Second Circuit, in its per curiam opinion, meant to do more than suggest the district court had abused its discretion, the decision's rationale does not apply here, for the underlying contract does not identify an arbitral forum. In re Mercury Construction Corp., supra, involved an appeal from a stay of federal court litigation pending state court determination of the issue of arbitrability-an issue that was also before the federal court. Nothing in that opinion suggests that a district court lacks power to stay § 4 proceedings in an appropriate case. Moreover, the Fourth Circuit holding rested heavily upon a discussion of the relationship between state and federal courts-a matter not relevant here. Finally, in Lawn v. Franklin, 238 F.Supp. 791 (S.D.N.Y.1971), there is no discussion of a district court's power to stay § 4 proceedings. Indeed, insofar as the power of a district court to determine the forum in which an issue should be litigated is discussed at all, the court suggests that it had such power. See id. at 793.
In reversing our preliminary decision on the matter, we are aware that the "law of the case" doctrine often bars reconsideration of legal issues previously decided in the same case. See White v. Higgins, 116 F.2d 312 (1st Cir. 1940). The doctrine, however, is discretionary, Cornelius v. Hogan, 663 F.2d 330, 334 n.6 (1st Cir. 1981), and does not necessarily preclude us from overruling a decision once we are convinced it is erroneous. Helms Bakeries v. Commissioner, 263 F.2d 642 (9th Cir.), cert. denied, 360 U.S. 903, 79 S.Ct. 1285, 3 L.Ed.2d 1255, rehearing denied, 361 U.S. 857, 80 S.Ct. 44, 4 L.Ed.2d 96 (1959). In this instance, our initial decision was made in a preliminary order without benefit of full argument. Reconsideration so soon after the initial decision prejudices no one and does not significantly encourage the parties to relitigate legal issues once decided. Finally, courts have hesitated to apply the "law of the case" doctrine mechanically where, as here, the issue to be reconsidered is jurisdictional. See Crane Co. v. American Standard, Inc., 603 F.2d 244, 248-49 (2d Cir. 1979); Potomac Passengers Association v. Chesapeake & Ohio Railway, 520 F.2d 91, 95 n.22 (D.C.Cir.1975)
Nor is it appealable as the denial of an interlocutory injunction under 28 U.S.C. § 1292(a)(1). See John Thompson Beacon Windows, Ltd. v. Ferro, Inc., 232 F.2d at 369, and discussion infra at p. 381