Court Opinion

ID: 4239841
Source: CourtListenerOpinion
Date Created: 2018-01-27 01:00:21.748512+00
Date Added: 2024-06-11T07:48:04.551456
License: Public Domain

Case: 17-60550      Document: 00514324642         Page: 1    Date Filed: 01/26/2018

           IN THE UNITED STATES COURT OF APPEALS
                    FOR THE FIFTH CIRCUIT

                                                                      United States Court of Appeals

                                    No. 17-60550
                                                                               Fifth Circuit

                                                                             FILED
                                  Summary Calendar                    January 26, 2018
                                                                        Lyle W. Cayce
                                                                             Clerk
SESHADRI RAJU, M.D., P.A.,

                                                 Plaintiff−Appellant,
versus

ERIN MURPHY, M.D.,

                                                 Defendant−Appellee.

                   Appeal from the United States District Court
                     for the Southern District of Mississippi
                                 No. 3:17-CV-357

Before HIGGINBOTHAM, JONES, and SMITH, Circuit Judges.
PER CURIAM: *

       Two doctors had a business relationship and an agreement that contem-
plated arbitration to resolve disputes. When they disagreed, Seshadri Raju
sued Erin Murphy instead of invoking arbitration. The state suit was removed
to federal court, whereupon Murphy counterclaimed.                 Only then did Raju
invoke the arbitration clause. The district court denied Raju’s motion to stay

       * Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH
CIR. R. 47.5.4.
    Case: 17-60550    Document: 00514324642        Page: 2   Date Filed: 01/26/2018

                                 No. 17-60550

the proceedings and compel arbitration. Raju brings this interlocutory appeal
under 9 U.S.C. § 16(a).

      The district court issued a succinct but more than adequate explanation
of its reasons for denying arbitration. It noted that “[t]he right to arbitrate
. . . is subject to waiver” (quoting Nicholas KBR, Inc., 565 F.3d 904, 907 (5th
Cir. 2009) (citation omitted)). The court properly noted that “[w]aiver will be
found when the party seeking arbitration substantially invokes the judicial
process to the detriment or prejudice of the other party” (quoting Miller Brew-
ing Co. v. Fort Worth Distrib. Co., 781 F.2d 494, 497 (5th Cir. 1986)).

      The district court accurately found that Raju had “substantially in-
voke[d] the judicial process.” As the court said, “[t]he record suggests that
Dr. Raju was initially uninterested in resolving this dispute through arbitra-
tion” and decided on that avenue only when the case landed in federal court
through removal. As the court opined, “Dr. Raju clearly prefers litigation over
arbitration, apparently just not in this Court.”

      Murphy still must show prejudice to establish waiver, for, as the district
court observed, “[i]nvocation of the Judicial process, alone, is insufficient to
support waiver of arbitration.” The court correctly found prejudice from Mur-
phy’s being required to answer the complaint, to file a counterclaim, to consult
with two law firms, and to gear her legal strategy to court proceedings instead
of arbitration. The court pointed out that Murphy was also prejudiced by the
public nature of the lawsuit, whereas arbitration would have been private and
confidential, so Murphy was hurt “by the public filing of the highly charged
allegations accusing her of tortious and even criminal conduct.”

      The district court handled this matter ably, fairly, and expeditiously.
There was prejudice and waiver. The order denying the motion to stay and to
compel arbitration is AFFIRMED.

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