Court Opinion

ID: 4303597
Source: CourtListenerOpinion
Date Created: 2018-08-14 19:00:24.23966+00
Date Added: 2024-06-11T14:33:45.702037
License: Public Domain

UNPUBLISHED

                      UNITED STATES COURT OF APPEALS
                          FOR THE FOURTH CIRCUIT

                                      No. 18-1058

WEIRTON MEDICAL CENTER, INCORPORATED,

                    Plaintiff - Appellant,

             v.

QUORUM HEALTH RESOURCES, LLC; STEPHEN MILLER; MICHAEL
ROLPH; ROBERT LOVELL; ROBERT VENTO; DANIEL HAMMAN; JOHN
WALTKO,

                    Defendants - Appellees,

             and

COMMUNITY HEALTH SYSTEMS, INCORPORATED,

                    Defendant.

Appeal from the United States District Court for the Northern District of West Virginia,
at Wheeling. Frederick P. Stamp, Jr., Senior District Judge. (5:15-cv-00132-FPS)

Submitted: July 31, 2018                                     Decided: August 14, 2018

Before MOTZ and KEENAN, Circuit Judges, and SHEDD, Senior Circuit Judge.

Affirmed by unpublished per curiam opinion.
Patrick S. Casey, CASEY & CHAPMAN, PLLC, Wheeling, West Virginia; Anthony
Cillo, COHEN & GRIGSBY, PC, Pittsburgh, Pennsylvania, for Appellant. Ellis R.
Lesemann, Michelle A. Matthews, LESEMANN & ASSOCIATES LLC, Charleston,
South Carolina; William J. Ihlenfeld, II, BAILEY & GLASSER LLP, Wheeling, West
Virginia, for Appellees.

Unpublished opinions are not binding precedent in this circuit.

                                            2
PER CURIAM:

       Weirton Medical Center, Inc. (“Weirton”), appeals the district court’s order

confirming an arbitration award entered in favor of Quorum Health Resources, LLC

(“Quorum”), and several individuals.      Weirton argues that the arbitrator manifestly

disregarded the law in applying res judicata and collateral estoppel to bar most of its

claims. For the reasons that follow, we affirm.

       “This court reviews de novo the district court’s denial of a motion to vacate an

arbitration award.” Brown & Pipkins, LLC v. Serv. Emps. Int’l Union, 846 F.3d 716, 723

(4th Cir. 2017) (brackets and internal quotation marks omitted). Generally, “judicial

review of an arbitration award in federal court is severely circumscribed and among the

narrowest known at law.” Jones v. Dancel, 792 F.3d 395, 401 (4th Cir. 2015) (internal

quotation marks omitted). However, a court may vacate an arbitration award upon a

showing that the arbitrator manifestly disregarded the law. Wachovia Sec., LLC v. Brand,

671 F.3d 472, 483 (4th Cir. 2012). To prevail under this standard, a plaintiff must

demonstrate “that: (1) the disputed legal principle is clearly defined and is not subject to

reasonable debate; and (2) the arbitrator refused to apply that legal principle.” Jones, 792
F.3d at 402. Misapplication or misconstruction of the law does not constitute manifest

disregard. Id. Rather, the plaintiff must show that the arbitrator was “aware of the law,

understood it correctly, found it applicable to the case before [him], and yet chose to

ignore it in propounding [his] decision.” Remmey v. PaineWebber, Inc., 32 F.3d 143, 149

(4th Cir. 1994).

                                             3
       In 2015, QHR Intensive Resources, LLC (“QIR”), a subsidiary of Quorum,

prevailed in an arbitration proceeding against Weirton. The arbitration concerned a

dispute over QIR’s agreement to provide Weirton with various hospital management

services, including appointment of three interim executive officers.        While Weirton

unsuccessfully pursued vacatur of this first arbitration award, see Weirton Med. Ctr., Inc.

v. QHR Intensive Res., LLC, 682 F. App’x 227 (4th Cir. 2017) (No. 16-1647), it

commenced the instant action against Quorum, the three interim officers, and others. The

district court eventually ordered the case to arbitration, where the arbitrator determined

that most of Weirton’s claims had already been adjudicated in the first arbitration and

entered an award in Appellees’ favor. The district court denied Weirton’s motion to

vacate the arbitration award and granted Appellees’ motion to confirm.

       On appeal, Weirton contends that the second arbitrator ignored the first arbitrator’s

determination that the three interim officers were employees only of Weirton, such that

they could not be in privity with QIR for claim preclusion purposes. See Fruth v.

Powers, 806 S.E.2d 465, 474 (W. Va. 2017) (providing West Virginia requirements for

res judicata and collateral estoppel). Weirton maintains that the second arbitrator was

bound by the first arbitrator’s decision, and that the second arbitrator’s contradictory

finding reflected a manifest disregard for the law of the case. Weirton is mistaken,

however, as the first arbitrator did not address whether the interim officers severed their

relationship with QIR or enjoyed an exclusive relationship with Weirton. Rather, the first

arbitrator merely stated that the interim officers served as Weirton’s borrowed

employees.    As a result, the second arbitrator’s finding—that the interim officers

                                             4
remained in privity with QIR while working for Weirton—is not inconsistent with the

first arbitrator’s findings. Thus, we conclude that Weirton has failed to establish that the

second arbitrator manifestly disregarded the law in reaching his decision.

       Accordingly, we affirm the judgment of the district court. We dispense with oral

argument because the facts and legal contentions are adequately presented in the

materials before this court and argument would not aid the decisional process.

                                                                               AFFIRMED

                                             5