Court Opinion

ID: 9375033
Source: CourtListenerOpinion
Date Created: 2023-02-24 18:00:58.634904+00
Date Added: 2024-06-11T17:16:55.384177
License: Public Domain

NOT FOR PUBLICATION                         FILED
                    UNITED STATES COURT OF APPEALS                        FEB 23 2023
                                                                      MOLLY C. DWYER, CLERK
                                                                       U.S. COURT OF APPEALS
                             FOR THE NINTH CIRCUIT

ROBERT RADCLIFFE, CHESTER                       No.    21-56284
CARTER, MARIA FALCON, CLIFTON C.
SEALE III, ARNOLD LOVELL, Jr.,                  D.C. No.
                                                8:05-cv-01070-DOC-MLG
                Plaintiff-Appellants,

and                                             MEMORANDUM*

CHARLES JUNTIKKA AND
ASSOCIATES LLP, Counsel for Plaintiffs,

                Appellant,

and

JOSE HERNANDEZ, KATHRYN PIKE,
LEWIS MANN, ROBERT RANDALL,
BERTRAM ROBISON,

                Plaintiff-Appellees,

and

CADDELL & CHAPMAN, Counsel for
Plaintiffs; LIEFF, CABRASER, HEIMANN
& BERNSTEIN LLP, Counsel for Plaintiffs;
FRANCIS MAILMAN SOUMILAS, P.C.,
Counsel for Plaintiffs; NATIONAL
CONSUMER LAW CENTER, Counsel for
Plaintiffs; CONSUMER LITIGATION

      *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
ASSOCIATES, P.C., Counsel for Plaintiffs;
CALLAHAN, THOMPSON, SHERMAN &
CAUDILL LLP, Counsel for Plaintiffs;
PUBLIC JUSTICE, P.C., Counsel for
Plaintiffs,

                Appellees,

 v.

EQUIFAX INFORMATION SERVICES,
LLC; EXPERIAN INFORMATION
SOLUTIONS, INC.; TRANS UNION LLC,

                Defendants.

                   Appeal from the United States District Court
                      for the Central District of California
                    David O. Carter, District Judge, Presiding

                          Submitted February 17, 2023**
                            San Francisco, California

Before: WARDLAW, NGUYEN, and KOH, Circuit Judges.

      Counsel Charles Juntikka (Juntikka) appeals the district court’s denial of his

motion to vacate an arbitration award that allocated attorneys’ fees among class

counsel from a class action against three credit-reporting companies. Juntikka

contends that the arbitrator exceeded her powers in violation of the Federal

Arbitration Act (FAA), 9 U.S.C. §§ 1–16, when she relied on equitable

      **
             The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).

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considerations to fashion her final fee award instead of applying the terms of the

class counsels’ fee allocation agreements.

      We review a district court’s decision to confirm an arbitration award by

“accepting findings of fact that are not clearly erroneous but deciding questions of

law de novo.” Aspic Eng’g & Constr. Co. v. ECC Centcom Constructors LLC, 913

F.3d 1162, 1165–66 (9th Cir. 2019) (internal quotation marks and citation

omitted). Exercising jurisdiction under 9 U.S.C. § 16(a)(3) and 28 U.S.C. § 1291,

we affirm.

      The district court properly denied Juntikka’s motion to vacate the arbitration

award. “The [FAA] enumerates limited grounds on which a federal court may

vacate, modify, or correct an arbitral award.” Kyocera Corp. v. Prudential-Bache

Trade Servs., Inc., 341 F.3d 987, 994 (9th Cir. 2003) (en banc). Arbitrators

“exceed their powers” under § 10(a)(4) of the FAA “not when they merely

interpret or apply the governing law incorrectly, but when the award is ‘completely

irrational’ or exhibits a ‘manifest disregard of the law.’” Id. at 997 (citations

omitted). Thus, a court may vacate an arbitration decision pursuant to § 10(a)(4)

only if the arbitrator “strays from interpretation and application of the agreement

and effectively dispense[s] h[er] own brand of industrial justice.” Major League

Baseball Players Ass’n v. Garvey, 532 U.S. 504, 509 (2001) (first alteration in

original) (internal quotation marks and citation omitted).

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      Here, the arbitrator did not show manifest disregard of the law when she

applied equitable considerations in arriving at the fee award. The arbitrator relied

on our precedent in In re FPI/Agretech Securities Litigation, 105 F.3d 469 (9th

Cir. 1997), and Vizcaino v. Microsoft Corp., 290 F.3d 1043 (9th Cir. 2002), to

conclude that a court may reject a fee allocation agreement if it “rewards an

attorney in disproportion to the benefits that attorney conferred upon the class,”

Agretech, 105 F.3d at 473. The arbitrator provided copious evidence that Juntikka

and his partner, Dan Wolf, failed to confer a net benefit on the class from their pre-

objection efforts. Because the arbitrator relied on Agretech and Vizcaino in

determining the ultimate award, she did not “dispense[] h[er] own brand of

industrial justice,” Major League Baseball, 532 U.S. at 509 (citation omitted), and

therefore did not exceed her powers in violation of § 10(a)(4).

      Juntikka argues that the arbitrator’s reliance on Agretech is misplaced

because it merely recognizes a district court’s authority to override a fee

arrangement, not that of an arbitrator. However, “[m]anifest disregard . . . requires

something beyond and different from a mere error in the law or failure on the part

of the arbitrators to understand and apply the law.” HayDay Farms, Inc. v. FeeDx

Holdings, Inc., 55 F.4th 1232, 1240 (9th Cir. 2022) (citation omitted). Even if the

arbitrator incorrectly applied Agretech, “we may not reverse an arbitration award

even in the face of an erroneous interpretation of the law.” Collins v. D.R. Horton,

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Inc., 505 F.3d 874, 879 (9th Cir. 2007); see also E. Associated Coal Corp. v.

United Mine Workers of Am., 531 U.S. 57, 62 (2000) (“[T]he fact that a court is

convinced [an arbitrator] committed serious error does not suffice to overturn [her]

decision.” (internal quotation marks and citation omitted)).

      Juntikka maintains that, even if the arbitrator did not manifestly disregard

the law, the arbitrator exceeded her powers because her decision “fail[ed] to draw

its essence from the agreement.” Aspic, 913 F.3d at 1166 (citation omitted). To be

sure, we have vacated arbitration awards where the arbitrator blatantly disregards

express terms of the parties’ agreements. See Aspic, 913 F.3d at 1168; Pac. Motor

Trucking Co. v. Auto. Machinists Union, 702 F.2d 176, 177 (9th Cir. 1983); see

also Stolt-Nielsen S.A. v. AnimalFeeds Int’l Corp., 559 U.S. 662, 682–83 (2010).

But in those cases, the arbitrator “underst[oo]d and correctly state[d] the law, but

proceed[ed] to disregard the same.” Bosack v. Soward, 586 F.3d 1096, 1104 (9th

Cir. 2009) (alterations in original) (citation omitted); see Aspic, 913 F.3d at 1167–

68. Here, the arbitrator understood the relevant law as permitting her to override

the contract and allocate fees in proportion to the benefit Juntikka and Wolf

conferred upon the class. Accordingly, the district court properly denied the

motion to vacate the fee award.

      AFFIRMED.

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