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Russ v. United Services Automobile Association

United States District Court, D. Arizona

July 12, 2019

Ronald C Russ, Plaintiff,
v.
United Services Automobile Association, et al., Defendants.

          ORDER

          Honorable Susan M. Brnovich United States District Judge.

         Pending before the Court is Plaintiff's Motion to Vacate Arbitration Award (Doc. 1) and Defendants' Cross-Motion to Confirm Arbitration Award (Doc. 15).[1]

         BACKGROUND

         The underlying dispute that resulted in the parties participating in arbitration stems from Plaintiff Ronald Russ's allegations against his former employer, Defendant United Services Automobile Association (“USAA”), and his former Supervisor, Gary Sherry. In 2016, Plaintiff filed a complaint in this Court alleging a count of retaliation against USAA and a count of FMLA interference against USAA and Sherry. Russ v. United Servs. Auto. Ass'n, No. CV-16-02787-PHX-PGR (D. Ariz. Aug. 18, 2016). On May 11, 2017, this Court granted Defendants' Motions to Dismiss and Compel Arbitration, ordering Plaintiff to initiate arbitration of his claims. Russ v. United Servs. Auto. Ass'n, No. CV-16-02787-PHX-PGR, 2017 WL 1953458, at *5 (D. Ariz. May 11, 2017). On August 29, 2018, Arbitrator Richard D. Fincher issued a “Final Order on Respondent's Motion to Dismiss, ” granting the motion and noting that USAA was “entitled to total dismissal with prejudice.” (Doc. 1 at 101-113). The Arbitrator found that the action should be dismissed after balancing factors including Plaintiff's failure to comply with discovery obligations. (Doc. 1 at 113). Plaintiff then initiated this action by filing the instant “Motion to Overturn and Vacate A[r]bitrator Dismissal Decision of Aug. 29, 2018 and Reopen Arbitration Case, Order Removal of Arbitrator Richard D. Fincher, Begin Case Anew with no New Filing Required.” (Doc. 1). Defendants filed a response, which also included a “Cross-Motion to Confirm Dismissal.” (Doc. 15).

         DISCUSSION

         I. Legal Standard

         Under the Federal Arbitration Act (“FAA”), 9 U.S.C. § 1 et seq., where a controversy has been arbitrated pursuant to a valid arbitration provision and the arbitrator has made an award, the parties may seek to confirm, see 9 U.S.C. § 9, or to vacate, see 9 U.S.C. § 10, that award in the appropriate court. See Hall St. Assocs., L.L.C. v. Mattel, Inc., 552 U.S. 576, 582 (2008) (“The Act also supplies mechanisms for enforcing arbitration awards: a judicial decree confirming an award, an order vacating it, or an order modifying or correcting it. §§ 9-11.”). The Court's “review of the arbitration panel's decision is greatly limited” as “arbitration is an encouraged method of dispute resolution.” U.S. Life Ins. Co. v. Superior Nat. Ins. Co., 591 F.3d 1167, 1172 (9th Cir. 2010). This limited review authority preserves due process but does not permit “unnecessary public intrusion into private arbitration procedures.” Kyocera Corp. v. Prudential-Bache Trade Servs., Inc., 341 F.3d 987, 998 (9th Cir. 2003).

         Under Section 10, a district court, in the district where an arbitration award was made, may issue an order vacating the award under certain limited circumstances:

(1) where the award was procured by corruption, fraud, or undue means;
(2) where there was evident partiality or corruption in the arbitrators, or either of them;
(3) where the arbitrators were guilty of misconduct in refusing to postpone the hearing, upon sufficient cause shown, or in refusing to hear evidence pertinent and material to the controversy; or of any other misbehavior by which the rights of any party have been prejudiced; or
(4) where the arbitrators exceeded their powers, or so imperfectly executed them that a mutual, final, and definite award upon the subject matter submitted was not made.

9 U.S.C. § 10; see also U.S. Life Ins., 591 F.3d at 1173 (noting that in Hall Street Associates, “the Supreme Court resolved a circuit conflict and ruled that § 10 lists the exclusive grounds for vacating an arbitration award”). “Notice of a motion to vacate . . . an award must be served upon the adverse party or his attorney within three months after the award is filed or delivered.” 9 U.S.C. § 12. “The burden of establishing grounds for vacating an arbitration award is on the party seeking” to vacate the award. U.S. Life Ins. Co., 591 F.3d at 1173.

         Under the terms of Section 9, unless an arbitration award has been vacated, modified or corrected pursuant to §§ 10 and 11, if a party files a motion to confirm, “a court ‘must' confirm [the] arbitration award[.]” Hall St. Assocs., ...


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