Opinion ID: 6986484
Heading Depth: 1
Heading Rank: 1

Heading: facts

Text: The petitioners, defendants in the underlying state court actions and appellants here, comprise an intricate corporate hierarchy. The Paul Revere Variable Annuity Insurance Company (Variable) and The Paul Revere Protective Life,, Insurance Company (Protective) are wholly-owned subsidiaries of The Paul Revere Life Insurance Company (Revere Life). Revere Life is, in turn, a wholly-owned subsidiary of The Paul Revere Corporation (PR Corp.). These four Massachusetts corporations share a principal place of business in Worcester. For many years, they competed with Provident Life & Accident Insurance Company (PL & A), a Tennessee corporation. PL & A is a wholly-owned subsidiary of a Delaware corporation, Provident Companies, Inc., and both are headquartered in Tennessee. 1 On March 27, 1997, Provident acquired PR Corp. (and, thus, gained effective control of all the other Paul Revere companies). Seventeen individuals who labored deep within the corporate web learned of this transaction with considerable trepidation. Scattered throughout the country, each held the position of General Manager— Career pursuant to an employment agreement with Variable, Protective, and Revere Life. 2 Alleging that the acquirer made it abundantly clear that they would be terminated after the acquisition was completed, the seventeen filed separate, but substantially similar, breach-of-contract actions in Worcester Superior Court against all six of the corporate entities identified above. 3 As a condition of his or her employment, each manager had been required to register with NASD and to promise to abide by NASD’s rules and regulations (as from time to time amended). At the time the managers sued, the NASD Code mandated arbitration of certain disputes if requested by an NASD member or a person associated with a member. Invoking this mandate and citing the Federal Arbitration Act (FAA), 9 U.S.C. § 3, the petitioners asked the state court to stay its hand or to dismiss the managers’ complaints pending arbitration. The managers objected to these motions and voluntarily dismissed their actions against Variable (the only petitioner that was an NASD member). 4 The petitioners attempted to parry this thrust by shifting venues. Because none of the respondents was a citizen of Massachusetts, Tennessee, or Delaware, diversity jurisdiction existed. See 28 U.S.C. § 1332(a). Seizing on this fortuity, the petitioners again invoked the FAA and asked the federal district court to compel arbitration. . The district court denied these entreaties on the ground that the petitioners lacked standing under NASD’s arbitration protocol. See Paul Revere Variable Annuity Ins. Co. v. Thomas, 66 F.Supp.2d 217, 223-28 (D.Mass.1999). The petitioners seek review of this ruling. See 9 U.S.C. § 16.