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SEPTEMBER 2017


The Commercial Litigation Section is looking forward to the Winter Meeting, February 24-28, 2018, on Amelia Island.  Start making your plans now for what will be a tremendous CLE program at a wonderful destination.


Our Section is joining the Corporate Counsel Committee and the ADR Committee at Amelia to examine the “Role of In-House Counsel in Alternative Dispute Resolution.” The panelists will include folks from both industry and law firms and they will provide detailed and tested advice on how to succeed in mediations by obtaining the best possible result for your client.  You’ll enjoy this one.


Plans are also underway for the Summer Meeting in Hawaii.  If you have ideas for topics at that meeting, please let us know. 

Do you know someone who would be a good candidate to join the Federation?  You know how much the FDCC means to you, why not suggest to a friend that they submit an application?  New members mean new ideas and new perspectives for our dynamic organization.  Let us know if you have a name in mind and we’ll help shepherd the candidate through the process. 

This month, we are very fortunate to have an excellent and insightful article prepared by one of our Vice Chairs, Vicki Smith.  Vicki is a partner with the Bodyfelt Mount law firm in Portland, Oregon.  She has broad experience on many issues, including breach of contract, insurance coverage, professional liability, product liability and construction defects.  Her article discusses a recent 9th Circuit Case that is of interest to everyone. 


Please contact us with ideas or if you would like to submit a quick article of interest. 

Chair: William Vita

Vice Chairs: Sonia Bjorkquist, Vicki Smith and Sean C. Griffin.

 

 

Beware the Arbitration Provision Not in Your Client’s Contract

Authored By: Vicki M. Smith, Bodyfelt Mount, Portland, OR


The 9th Circuit recently confirmed the arbitrator’s authority to decide issues of arbitrability under the parties’ agreed upon arbitration rules.  In Portland GE v. Liberty Mut. Ins. Co., 2017 U.S. App. LEXIS 16409 (9th Cir. July 10, 2017 amended Aug. 29, 2017), the court determined that parties which incorporate the rules of the International Chamber of Commerce (“ICC”) into an arbitration agreement adequately delegate gateway issues of arbitrability to the arbitrator.  In an unusual twist, the arbitrator’s authority was extended to claims by a party who was not included in the contract containing the arbitration clause, even when the two parties involved in the claims had not agreed to arbitrate their dispute. 

Portland General Electric (“PGE”) entered into a construction contract with a contractor to build an Oregon power plant.  The contract required the contractor to obtain a performance bond and a guaranty of performance from a parent company, Abengoa.  Both the guaranty and performance bond were issued to PGE.   As a result, there were three contracts: 1) the construction contract between PGE and the contractor that contained no arbitration clause; 2) the guaranty contract between PGE and Abengoa that called for arbitration under the ICC rules; and 3) the performance bond that contained no arbitration provision. 

A dispute arose, and PGE terminated the construction contract.  Abengoa filed for arbitration against PGE under the guaranty, asserting PGE’s termination of the construction contract was wrongful and Abengoa owed nothing under the guaranty.  Per the guaranty and ICC rules, Abengoa sought to implead the sureties that issued the performance bond into the arbitration.  The sureties consented to the arbitration and sought similar relief against PGE.  PGE objected to the sureties being involved in the arbitration as the bond did not contain an arbitration clause.  PGE filed suit seeking a preliminary injunction prohibiting the sureties from arbitrating their claims against PGE.  The district court granted the injunction.


“Gateway” questions of arbitrability are presumptively reserved for the court’s decision, such as which parties are bound by an arbitration provision and whether an arbitration provision applies to a specific issue.   Parties may delegate those gateway questions to the arbitrator if the parties “clearly and unmistakably” agree to do so.  The 9th Circuit previously held that contracts incorporating the American Arbitration Association rules constitute “clear and unmistakable” evidence that the parties delegated gateway arbitrability issues to the arbitrator.  With the PGE decision, the 9th Circuit joins the 1st and 2nd Circuits in holding that contracts incorporating the ICC rules into an arbitration agreement also adequately delegate gateway issues to the arbitrator.  In this case, that delegation extends not only to the two parties to the arbitration agreement but also to the impleaded parties’ claims against a party to the arbitration agreement. The 9th Circuit vacated the district court’s grant of a preliminary injunction and allowed the arbitrator to determine whether the sureties’ claims against PGE should be included in the arbitration.  

Despite PGE not agreeing to arbitrate issues involving the sureties, it could very well find itself doing just that because of another contract it entered with another party. Before entering a contract, parties should review other arguably related contracts and determine whether those other contracts contain arbitration provisions. 

 

 

AUGUST 2017


The Commercial Litigation Section teamed up with the Appellate Litigation Section in Montreux to present a thought-provoking panel discussion comparing litigation in Europe and North America.  The stellar panel consisted of Jorge Angell, from Madrid, Stephen Brake, from Boston, Stephen Carter, from London and Charlie Frazier from Dallas.  It was moderated by William Vita, from New York.  Thank you to our speakers, it was truly an interesting, lively and interactive panel.

 

 We are now looking forward to the Winter Meeting in Amelia Island.  The beaches are beautiful and you’ll enjoy sitting under the palm trees, away from the cares of winter, so make your plans now!  The Winter Meeting will run from February 24 through February 28, 2018. 


Two section members, Rachel Reynolds and Olga Viera, have agreed to plan our Amelia presentation.  We will be joining with the Corporate Counsel Committee.  The presentation will explore the role of in-house counsel in alternative dispute resolution.  If you are interested in joining the planning group, please let us know. 

Huge thanks go out to Stephen Feldman for his tremendous leadership of our section during the last two years.  His tireless efforts resulted in excellent presentations and increased involvement by committee members.  Going forward, the Committee will be chaired by William Vita.  The Vice Chairs are Sonia Bjorkquist, Vicki Smith and Sean C. Griffin.  We are looking forward to an exciting and productive year.

 

Please contact us and get involved with the committee.  We need your help and ideas.



MAY 2017


Montreaux preview – a Comparison of Commercial Litigation in Europe and North America


The Appellate, Commercial Litigation, and International Sections have teamed up this summer for a program on how commercial litigation differs on both sides of the pond.  An international panel will focus on what American attorneys should know when advising their clients about business dealings in Europe—and vice versa.  From enforcement of contracts to Brexit, this discussion will be up-to-the-minute and informative for all.  Bill Vita will moderate the panel, and he will be joined by Jorge Angell (from Madrid), Stephen Carter (from London), and U.S. lawyers Steve Brake and Charlie Frazier.

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Featured Members
Melinda S. KollrossDefense Counsel, Clausen Miller PC, Chicago, IL
J. Eric MilesDefense Counsel North, Pursell & Ramos, PLC, Nashville, TN

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