Court Opinion

ID: 4319392
Source: CourtListenerOpinion
Date Created: 2018-10-11 20:01:25.28094+00
Date Added: 2024-06-11T14:45:50.488665
License: Public Domain

FILED
                                                                    United States Court of Appeals
                      UNITED STATES COURT OF APPEALS                        Tenth Circuit

                            FOR THE TENTH CIRCUIT                         October 11, 2018
                        _________________________________
                                                                        Elisabeth A. Shumaker
                                                                            Clerk of Court
 DISH NETWORK, LLC, a Colorado
 limited liability company,

       Plaintiff - Appellee,

 v.                                                        No. 18-1131
                                                  (D.C. No. 1:16-CV-02083-LTB)
 SUJIT GHOSH, an individual resident of                      (D. Colo.)
 New York,

       Defendant - Appellant,

 and

 OPEN ORBIT CORPORATION,
 a New York company,

       Defendant.
                        _________________________________

                            ORDER AND JUDGMENT*
                        _________________________________

Before TYMKOVICH, Chief Judge, McKAY and MATHESON, Circuit Judges.
                 _________________________________

       Mr. Sujit Ghosh, appearing pro se, appeals the district court’s judgment

granting DISH Network, LLC’s amended motion to confirm an arbitration award

       *
        After examining the briefs and appellate record, this panel has determined
unanimously that oral argument would not materially assist in the determination of
this appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is therefore
ordered submitted without oral argument. This order and judgment is not binding
precedent, except under the doctrines of law of the case, res judicata, and collateral
estoppel. It may be cited, however, for its persuasive value consistent with
Fed. R. App. P. 32.1 and 10th Cir. R. 32.1.
against him based on his personal guaranty of defendant Open Orbit Corporation’s

performance under an agreement with DISH, even though he was not a party to the

arbitration. Our jurisdiction arises under 28 U.S.C. § 1291, and we affirm.

                                  BACKGROUND

      On March 12, 2012, Mr. Ghosh, then President of Open Orbit, agreed to the

terms of a Personal Guaranty whose purpose was “to induce DISH . . . to enter into

the DISH Network Retailer Agreement” with Open Orbit. R., Vol. 2 at 195. The

Personal Guaranty provided that Mr. Ghosh “personally, unconditionally and

irrevocably guarantee[d] the full and timely performance of and by [Open Orbit] for

all purposes under the Retailer Agreement.” Id. DISH and Open Orbit entered into a

Retailer Agreement effective January 1, 2013, which authorized Open Orbit to

market, promote, and solicit orders for DISH subscription satellite television

programming. Id. at 188. The Personal Guaranty provided that “[a]ny and all

disputes, controversies or claims arising out of or in connection with this Personal

Guaranty shall be resolved by arbitration . . . in accordance with both the substantive

and procedural laws of Title 9 of the U.S. Code (‘Federal Arbitration Act’) and the

Commercial Arbitration Association,” and that the arbitration would be conducted by

a three-arbitrator panel whose decision would be “final and binding on the parties.”

Id. at 195. The Retailer Agreement contained materially identical arbitration

provisions. See id. at 190.

      In 2015, DISH initiated an arbitration proceeding against Open Orbit based on

violations of the Retailer Agreement. Mr. Ghosh was not a party to the arbitration,

                                           2
but in February 2016, he emailed the arbitrator a request to remove his name from the

case and “from all kind[s] of responsibilities.” R., Vol. 1 at 85. He asserted that as

of the effective date of the Retailer Agreement, he was not an Open Orbit officer or

shareholder, that the alleged violations of the Retailer Agreement occurred after he

had parted from the company, and that the company’s current president and sole

owner had issued an indemnity bond that purported to indemnify Mr. Ghosh from

claims against Open Orbit and release him from any personal guarantees as of

January 1, 2013. He reiterated his position a couple of weeks later in a second email.

      Because Mr. Ghosh was not a party to the arbitration, the arbitrator treated the

request to remove his name from the case as a request to remove him as a witness and

denied it. The arbitrator also treated the request as seeking nullification of the

Personal Guaranty and denied it because the Personal Guaranty expressly provided

that any changes had to be “‘agreed to and signed by all Parties to [it,]’” and there

was no later agreement between DISH and Mr. Ghosh cancelling the Personal

Guaranty. Id., Vol. 2 at 198 (quoting id. at 195). The arbitrator later denied two

requests by Mr. Ghosh for reconsideration of his request to cancel his Personal

Guaranty. Id. at 199, 200. In denying the second such request, the arbitrator

informed Mr. Ghosh that unless he produced evidence of a written agreement signed

by DISH releasing him from the Personal Guaranty, the arbitrator would not respond

to any more requests from Mr. Ghosh for the same relief.

      Ultimately, the arbitrator entered an award in favor of DISH and against Open

Orbit for just over $220,000, plus post-award interest. Id. at 204. In his decision, the

                                            3
arbitrator noted that in response to DISH’s motion for fees and costs, Mr. Ghosh had

submitted a letter “again voicing disagreement with [the] prior order regarding his

Personal Guaranty.” Id. at 203.

      DISH then sought confirmation of the arbitration award in federal court,

naming both Open Orbit and Mr. Ghosh as defendants. Open Orbit did not appear,

and DISH sought a default judgment against it. A magistrate judge recommended

granting default judgment against Open Orbit in the full amount of the award.

Mr. Ghosh filed a motion for relief from the award, arguing, among other things, that

he was not a party to the arbitration. The magistrate judge recommended granting

Mr. Ghosh’s motion for relief in part and dismissing him from the case without

prejudice to DISH’s ability to file either a separate action against Mr. Ghosh or an

amended application to confirm the arbitration award against him in accordance with

caselaw allowing confirmation against nonparties under certain circumstances.

Among the circumstances the magistrate judge identified is where “the person

seeking confirmation pleads a claim in the confirmation proceeding to extend

liability without involving extensive factual issues.” R., Vol. 2 at 60 (citing Orion

Shipping & Trading Co. v. E. States Petrol. Corp., 312 F.2d 299, 301 (2d Cir. 1963)).

      The district judge accepted the magistrate judge’s recommendations. DISH

then filed an amended confirmation application asserting that the court could confirm

the arbitration award against Mr. Ghosh without extensive factfinding and based on

the Personal Guaranty, the validity of which Mr. Ghosh could not deny because the

                                           4
arbitrator, at Mr. Ghosh’s request, had determined that there was no later agreement

between DISH and Mr. Ghosh cancelling the Personal Guaranty.

       Based on Mr. Ghosh’s argument that he could not be compelled to pay the

award against Open Orbit unless there was a specific award entered against him

pursuant to the arbitration clause in the Personal Guaranty, the court ordered DISH to

show cause why it should not compel the two parties to arbitrate their dispute. DISH

responded that the court could determine Mr. Ghosh’s liability under the Personal

Guaranty based on documents and admissions already before the court and without

extensive factfinding, and therefore DISH should not have to go through another

arbitration. DISH observed that Mr. Ghosh had purposefully availed himself of the

arbitrator’s authority and jurisdiction when he repeatedly asked the arbitrator to

cancel the Personal Guaranty with the understanding that the arbitrator’s decision

would be “final and binding on the parties,” id., Vol. 3 at 50, and Mr. Ghosh had

expressed “full confidence in [the arbitrator’s] judgment,” id., at 51, and admitted he

had provided “all the required documents and evidences [sic] in support of [his]

claim,” id. at 55.

       The district court concluded that even though Mr. Ghosh was not a party to the

arbitration, the award should be confirmed against him because he had notice of the

arbitration and participated in it, the arbitrator decided the issue against Mr. Ghosh,

and issue preclusion barred Mr. Ghosh from relitigating the issue before another

arbitrator. The court therefore granted the amended application to confirm the

arbitration award against Mr. Ghosh, who now appeals.

                                            5
                                     DISCUSSION

      “Judicial review of arbitration . . . decisions is extremely limited” and “among

the narrowest known to law.” Dominion Video Satellite, Inc. v. Echostar Satellite

L.L.C., 430 F.3d 1269, 1275 (10th Cir. 2005) (internal quotation marks omitted).

That said, we are not called on in this appeal to review the arbitrator’s denial of

Mr. Ghosh’s request to nullify the Personal Guaranty. Instead, Mr. Ghosh challenges

the district court’s decision to confirm the arbitration award against him even though

he was not a party to the arbitration. In considering that challenge, we examine the

“district court’s factual findings in confirming the award for clear error and its legal

conclusions de novo.” Id. And because Mr. Ghosh is pro se, we construe his filings

liberally but do not act as his advocate. Yang v. Archuleta, 525 F.3d 925, 927 n.1

(10th Cir. 2008).

      Mr. Ghosh’s primary arguments focus on the fact that he was not a party to the

arbitration and that the Personal Guaranty contains its own mandatory arbitration

provision. He first contends that an award could not be confirmed against him unless

there was an arbitration in accordance with the procedure outlined in the Personal

Guaranty—one where he receives written notice of the arbitration, the arbitration is

conducted by a panel of three arbitrators, and an arbitration award is entered

specifically against him. We disagree.

      Although it is undisputed that Mr. Ghosh was not a party to the arbitration, he

had notice of it and requested specific relief from the arbitrator—nullification of the

Personal Guaranty because the Retailer Agreement was executed after Mr. Ghosh

                                            6
was no longer an Open Orbit officer or shareholder and because the company’s

current owner had indemnified Mr. Ghosh from any liability arising from the

Personal Guaranty. The arbitrator concluded that only the parties could alter the

terms of the Personal Guaranty by a written, signed agreement, and there was no

evidence that had occurred. Mr. Ghosh has not challenged that conclusion. And

rather than initiating an arbitration to dispute liability under the Personal Guaranty,

Mr. Ghosh elected to appear in the existing arbitration, where he professed faith in

the arbitrator, claimed to have provided all the evidence relevant to his request to

nullify or cancel his liability under the Personal Guaranty, and acknowledged that the

arbitrator’s decision would be final and binding. Moreover, before the district court,

Mr. Ghosh stated that “there is no allegation of any wrong doing by the Arbitrator

nor any procedure was flawed.” R., Vol. 2 at 221. For these reasons, Mr. Ghosh

cannot now be heard to argue that he should have been afforded the opportunity to

separately arbitrate his liability under the Personal Guaranty before a three-member

panel of arbitrators.1

       Next, Mr. Ghosh attempts to distinguish two cases the district court relied on,

United States ex rel. Skip Kirchdorfer, Inc. v. M.J. Kelley Corp., 995 F.2d 656

(6th Cir. 1993), and United States ex rel. Aurora Painting, Inc. v. Fireman’s Fund

Insurance Co., 832 F.2d 1150 (9th Cir. 1987). Mr. Ghosh observes that there is no

       1
         The parties have not explained, nor does the record reflect, why the
arbitration between DISH and Open Orbit was decided by only one arbitrator rather
than a panel of three arbitrators, as specified in the Retailer Agreement.
                                            7
indication that the nonparty in either of those cases had a separate guaranty in favor

of the party seeking confirmation that contained a mandatory arbitration provision.

We agree with his reading of those cases, but the district court relied on them only

for the general “proposition that a non-party surety can be bound by the outcome of

arbitration proceedings,” R., Vol. 3 at 85 (emphasis added). The court then examined

whether the circumstances of Mr. Ghosh’s case warranted enforcing the arbitration

award against him and concluded that they did because, despite not being a party to

the arbitration, he “had notice of it and participated in it” and “specifically and

repeatedly asked the arbitrator to address the validity of the personal guaranty he

signed.” Id. We therefore conclude that the district court did not improperly rely on

the two cases.

      Mr. Ghosh further argues that because he was not a party to the arbitration,

one of the four elements of issue preclusion is not present—that “the party against

whom the doctrine is invoked was a party, or in privity with a party, to the prior

adjudication,” Park Lake Res. Ltd. Liab. Co. v. U.S. Dep’t of Agric., 378 F.3d 1132,

1136 (10th Cir. 2004) (internal quotation marks omitted).2 The district court

concluded that this element was met because Mr. Ghosh “raised and actually litigated

      2
         The other three elements are “the issue previously decided is identical with
the one presented in the action in question,” “the prior action has been finally
adjudicated on the merits,” and “the party against whom the doctrine is raised had a
full and fair opportunity to litigate the issue in the prior action.” Park Lake Res. Ltd.
Liab. Co., 378 F.3d at 1136 (internal quotation marks omitted). Mr. Ghosh has not
challenged the district court’s conclusion that these elements were met.
                                            8
the validity of his personal guaranty in the arbitration” even though he “was not a

party to the arbitration itself.” R., Vol. 3 at 86. We see no error.

      In limited circumstances, “the rule against nonparty preclusion is subject to

exceptions.” Taylor v. Sturgell, 553 U.S. 880, 893 (2008). Two are relevant here.

First, “‘a person who agrees to be bound by the determination of issues in an action

between others is bound in accordance with the terms of his agreement.’” Id.

(brackets omitted) (quoting 1 Restatement (Second) of Judgments § 40 (1980)). As

noted, Mr. Ghosh acknowledged that the arbitrator’s decision regarding nullification

of the Personal Guaranty would be “final and binding on the parties.” R., Vol. 3

at 50. Second, “a nonparty is bound by a judgment if [he] ‘assumed control’ over the

litigation in which that judgment was rendered,” Taylor, 553 U.S. at 895 (brackets

omitted) (quoting Montana v. United States, 440 U.S. 147, 154 (1979)). “Because

such a person has had ‘the opportunity to present proofs and argument,’ he has

already ‘had his day in court’ even though he was not a formal party to the

litigation.” Id. at 895 (quoting Restatement (Second) Judgments § 39, cmt. a (1980)).

Although Mr. Ghosh did not assume control over the arbitration on behalf of Open

Orbit, he did so on his own behalf by affirmatively and repeatedly asking the

arbitrator to nullify the Personal Guaranty, and he made multiple efforts to present

proofs and argument.

      Either of these exceptions is sufficient to support the district court’s

determination that the party/privity element of issue preclusion was met. We

therefore conclude that the district court properly considered the role of issue

                                            9
preclusion in deciding that Mr. Ghosh was “bound by the arbitrator’s decision that

the guaranty was valid,” that there “were no factual or legal issues regarding [his]

liability for Open Orbit’s obligations to DISH,” and that the only thing remaining

was for the “court to enforce the arbitration award against [him].” R., Vol. 3 at 86.

Cf. Orion Shipping & Trading Co., 312 F.2d at 301 (declining to extend confirmation

of award to nonparty because whether nonparty was alter ego of party to arbitration

or had consented to arbitration was too complex to hear in a confirmation action).

      Further, because Mr. Ghosh elected to present his proofs and argument in the

arbitration between DISH and Open Orbit, we will not now consider his challenges to

the validity of the Retailer Agreement and its relation to the Personal Guaranty, none

of which he raised in the arbitration.3

      Finally, Mr. Ghosh alleges that Open Orbit’s owner had settlement discussions

with DISH, and Open Orbit has liability insurance to cover the award. These alleged

facts, unsupported by any record citation, are irrelevant to the issue on appeal.

      3
         Those challenges are: (a) he never signed the Retailer Agreement (he in fact
told the arbitrator he had signed it, see R., Vol. 3 at 48); (b) DISH doctored the
Retailer Agreement by manually entering the effective date without knowledge or
consent of the other parties; (c) he never consented to linking the Retailer Agreement
with the Personal Guaranty; and (d) a retailer number that appears on the Retailer
Agreement had to be mentioned in the Personal Guaranty to show that the Retailer
Agreement was part of the Personal Guaranty.
                                           10
                            CONCLUSION

The district court’s judgment is affirmed.

                                     Entered for the Court

                                     Monroe G. McKay
                                     Circuit Judge

                                   11