Calton & Associates, Inc. et al v. Simmers, et al
ORDER: Plaintiffs' Motion to Confirm Interim Arbitration Award (Doc. # 59) is GRANTED. Defendant John Simmers' Petition to Vacate Arbitration Award (Doc. # 71) is DENIED. Defendant John Simmers' Petition to Vacate the Fee Award (Doc. # 82) is DENIED. The Interim Arbitration Award and Final Award are confirmed. The Clerk is directed to enter judgment in favor of Plaintiffs and against Defendant accordingly. The Clerk is directed to CLOSE the case. Signed by Judge Virginia M. Hernandez Covington on 1/17/2023.(DMD)
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UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
CALTON & ASSOCIATES, INC.,
DWAYNE K. CALTON, individually
and as Trustee of the DWAYNE K.
CALTON TRUST, UTA 3/30/1989,
RANDALL L. CICCATI,
RAMESHWAR SINGH, DEREK J.
CALTON, LORETTA D. CALTON,
GEORGE G. HARRINGTON, JR., and
JILL M. CICCATI,
Case No. 8:20-cv-851-VMC-CPT
JOHN SIMMERS, individually and as
Trustee of the SIMMERS FAMILY
TRUST DATED 9/18/92,
This matter is before the Court on consideration of
Plaintiffs’ Motion to Confirm Interim Arbitration Award (Doc.
Petition to Vacate Arbitration Award (Doc. # 71), filed on
September 4, 2022, and Simmers’ Petition to Vacate the Fee
Award (Doc. # 82), filed on November 21, 2022. The Motions
have been fully briefed. (Doc. ## 66, 69, 77, 81, 85). For
Case 8:20-cv-00851-VMC-CPT Document 90 Filed 01/17/23 Page 2 of 29 PageID 7296
the reasons detailed below, the Motion to Confirm is granted
and the Petitions to Vacate are denied.
The Court and the parties are familiar with the facts
underlying this action, and thus the Court need not outline
complaint before the Financial Industry Regulatory Authority
(“FINRA”) against Dwayne Calton, both individually and as
Trustee of his trust, Randall Ciccati, Jill Ciccati, Singh,
Derek Calton, Loretta Calton, and Harrington. (Doc. # 1-1).
including the 2012 Memorandum of Understanding (“MOU”), the
2013 Binding Agreement, and the 2014 Stock Option Agreement,
which involved the purchase of stock in the registered brokerdealer Calton & Associates, Inc. See (Id.).
On April 14, 2020, Plaintiffs CAA, Dwayne K. Calton,
both individually and as Trustee of the Dwayne K. Calton
Randall Ciccati, and Jill Ciccati filed this lawsuit seeking
a declaratory judgment and injunctive relief against Simmers,
individually and as Trustee of the Simmers Family Trust. (Doc.
# 1). Specifically, Plaintiffs sought a declaratory judgment
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that Simmers’ claims are not arbitrable before FINRA. (Doc.
# 1 at ¶ 138, pp. 26-27). Plaintiffs also sought an injunction
imposing a stay of the FINRA arbitration and preventing
Simmers from pursuing any claims against Plaintiffs in the
FINRA arbitration. (Id. at 27).
arbitration and to dismiss or, in the alternative, stay case
(Doc. # 19), seeking an order from this Court compelling
arbitration of his claims before the FINRA dispute resolution
forum and dismissing this case. The Court denied that motion
on August 17, 2020, because the AAA was the appropriate entity
“to determine if FINRA rules and regulations supersede the
parties’ agreements” to arbitrate before the AAA. (Doc. # 33
at 16). Plaintiffs then moved to compel arbitration before
the AAA (Doc. # 35), which the Court granted on October 6,
2020. (Doc. # 49).
The parties then initiated arbitration before the AAA.
The arbitrator held that the AAA was the proper arbitral
forum, and granted Plaintiffs a preliminary injunction on
March 22, 2021, enjoining the FINRA arbitration. (Doc. # 7112). In that order, the arbitrator wrote that, “[p]ursuant to
clauses, this matter is properly before the AAA” and “FINRA
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agreements to arbitrate before the AAA.” (Id. at 2). The FINRA
panel thus dismissed Simmers’ claims and Simmers then filed
a Counterclaim in the AAA arbitration. (Doc. # 59 at 2).
Subsequently, a thirteen-day arbitration final hearing
was held. (Id.). During the hearing, Simmers relied in part
on an order entered by Judge Bergmann in Dwayne Calton’s
divorce case in April 2005. In that order, Judge Bergmann
addressed the method of valuing the Calton & Associates, Inc.
stock to be divided between Dwayne Calton and his wife. (Doc.
# 71-3). Judge Bergmann ruled that the transfer restrictions
and valuation method outlined in the Agreement Restricting
action. (Id. at 3). However, Judge Bergmann held that the ART
“will continue to apply as to any transfer by [Dwayne Calton]
and/or [Calton’s wife] to a third party, that is not by
operation of law.” (Id. at 4).
Also during the hearing, Simmers attempted to introduce
Plaintiffs’ counsel in this case — that was taken in relation
to an earlier arbitration between Plaintiffs and Aatria. The
arbitrator denied Simmers’ request to read portions of the
transcript into the record. He noted that excluding the
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transcript prevented prejudice to Plaintiffs by keeping their
counsel from becoming a witness in the case but still allowed
Simmers to “point or read or put in any portion of the record,
arbitration and other proceedings, that [Simmers] believe[d]
argument that [he] want[ed] to make.” (Doc. # 74-2 at 1208).
The arbitrator entered an Interim Award in favor of
Plaintiffs on all counts and resolving all issues in the case,
besides Plaintiffs’ attorney’s fees and costs, on June 7,
2022. (Doc. # 59 at 2; Doc. # 59-1). The Arbitrator ruled in
favor of Plaintiffs on their sole count on jurisdiction and
related injunctive relief and denied all 14 counts brought by
Simmers in his Counterclaim. In addition to granting the
declaratory judgment in Plaintiffs’ favor that the AAA was
the proper forum for the dispute, the arbitrator entered “a
permanent injunction to prevent Simmers from refiling in
FINRA the claims asserted in this action or similar claims on
the same contracts at issue.” (Doc. # 59-1 at 4).
The Court will further outline only those portions of
the Interim Award most related to Simmers’ arguments for
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Agreement’], or SOA [‘the Stock Option Agreement’]” because
the MOU that Simmers signed did not make him a “Buyer” under
the SPA or SOA. (Id. at 8). The arbitrator also concluded
that “Aatria is a necessary and indispensable party to this
proceeding” and denied Simmers’ counterclaims related to the
party.” (Id. at 11). Likewise, Simmers had not met his burden
of “proving the extraordinary relief of specific performance
or rescission by clear and convincing evidence.” (Id. at 12).
The arbitrator further held that the ART had been “truly
ignored, waived, and abandoned” by the stockholders before
the Simmers Family Trust purchased stock in the company. (Id.
at 11). After pointing to significant evidence regarding the
violation of the ART, the arbitrator concluded: “The evidence
is clear that the Company and its shareholders waived the
restrictions are long ignored, they are waived. . . . Here
Simmers, who refused to be bound by the ART, remarkably seeks
to bind those who never enforced it in more than 30 years.
Company’s restricting 20% of the shares yet allowing 80% to
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freely trade.” (Id. at 11-12). The Court need not outline the
other aspects of the arbitrator’s Interim Order.
Confirm Interim Arbitration Award in this Court. (Doc. # 59).
While the Motion to Confirm was pending, the arbitrator issued
on August 22, 2022, his Final Award, which incorporates the
arbitrator’s costs and expenses. (Doc. # 77 at 2; Doc. # 781).
arbitrator wrote: “The arbitration agreements entered into
between the above-named parties incorporate the Commercial
Arbitration Rules of the [AAA] and those rules become part of
the agreement to arbitrate.” (Doc. # 78-1 at 2). He also noted
that all parties had “requested an award of attorney’s fees
and costs prior to the Final Hearing and Interim Award for
this matter.” (Id. at 2-3).
Arbitration Award on September 4, 2022, arguing that the
arbitration award should be vacated for multiple reasons.
(Doc. # 71). Simmers also filed a Petition to Vacate the Fee
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Award on November 21, 2022. (Doc. # 82). The Motions are fully
briefed (Doc. ## 66, 69, 77, 81, 85), and ripe for review.
“The Federal Arbitration Act (‘FAA’), 9 U.S.C. § 1, et
seq., imposes a heavy presumption in favor of confirming
arbitration awards.” Riccard v. Prudential Ins. Co., 307 F.3d
1277, 1288 (11th Cir. 2002). “Section 9 of the FAA provides
that, upon application of any party to the arbitration, the
court must confirm
vacated, modified, or corrected in accordance with sections
10 and 11 of the statute.” Frazier v. CitiFinancial Corp.,
Section 10 of the FAA permits vacatur of an arbitration
(1) where the award was procured by corruption,
fraud, or undue means;
corruption in the arbitrators, or either of them;
(3) where the arbitrators were guilty of misconduct
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,
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and definite award upon
submitted was not made.
9 U.S.C. § 10(a).
Additionally, “[t]he FAA sets forth certain threshold
requirements that must be satisfied before a district court
can entertain a petition for enforcement of an arbitration
award.” Vital Pharms. v. PepsiCo, Inc., 528 F. Supp. 3d 1304,
1307–08 (S.D. Fla. 2020) (citing 9 U.S.C. § 9). “First, the
party seeking confirmation of the award must do so within one
year of the date the award was made.” Id. at 1308. “Second,
because the FAA does not confer subject matter jurisdiction
district court may review it.” Id.
determination of this proceeding to confirm the arbitration
award, because the subject transaction involved interstate
commerce.” PriMed, Inc. v. Dallas Gen. Life Ins. Co., No.
8:11-cv-2002-VMC-AEP, 2012 WL 646221, at *1 (M.D. Fla. Feb.
28, 2012). “The FAA applies if the transaction involves
interstate commerce, even if the parties did not contemplate
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interstate commerce.” Id. (citing Rewards Hotel Mgmt. Co.,
LLC v. Elite Gen. Contractors, Inc., 860 So. 2d 1011, 1013
specifying that Florida law controls.” Id. Here, Plaintiffs
Simmers argues that “there is no difference between the” FAA
and the Florida Arbitration Code “in this matter.” (Doc. # 71
at 12). Thus, the Court will apply the FAA in resolving the
Prerequisites to Confirmation
First, the Court determines that the three threshold
requirements for confirmation of the arbitration awards are
requirements in his response to the Motion to Confirm. (Doc.
Plaintiffs’ Motion to Confirm was filed within one year
of the June 2022 issuance of the Interim Award. Next, the
Court has diversity jurisdiction over this case. As alleged
in the complaint and supplemental notice, there is complete
diversity between Plaintiffs and Simmers. (Doc. # 1 at 1-2;
Doc. # 87; Doc. # 89-1). Likewise, the amount in controversy
exceeds $75,000 because Simmers had alleged in his FINRA
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statement of claim that Plaintiffs breached their options
contracts with Simmers, under which Simmers had paid $1.7
million, and that the stock Plaintiffs allegedly wrongfully
transferred was valued at $2 million. (Doc. # 1 at 3).
The third requirement — that the award be sufficiently
final — is also met. The Interim Arbitration Award resolved
the substantive claim in this case and left unresolved only
the issue of attorney’s fees and costs. See (Doc. # 59-1 at
19) (“This Award is in full resolution of all claims submitted
to the Arbitrator. . . . The Arbitrator reserves jurisdiction
attorney’s fees, costs, and for the assessment of forum fees
based upon the findings in this Interim Order and Award of
Arbitrator.”); see also Publicis Commc’n v. True N. Commc’ns,
Inc., 206 F.3d 725, 729 (7th Cir. 2000) (“These cases show
that although the Federal Arbitration Act uses the word award
in conjunction with finality, courts go beyond a document’s
heading and delve into its substance and impact to determine
whether the decision is final.”).
Regardless, since the Motion to Confirm was filed, the
Final Award was issued on August 22, 2022. (Doc. # 78-1). The
arbitration, was issued before Simmers filed his Petition to
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Vacate on September 4, 2022, and Simmers has since filed a
arbitration is completely resolved and the parties have had
the opportunity to brief every aspect of the arbitral award.
Both the Interim Award and the Final Award are final such
that they may be confirmed.
Because these requirements have been met, the Court must
confirm the arbitration awards unless Simmers establishes
that vacatur is required under one of the FAA’s limited
reasons for vacatur.
Vacatur Arguments for Interim Award
Simmers raises three arguments to vacate the arbitral
award. According to Simmers, “[t]he Arbitrator exceeded his
powers by relieving Dwayne Calton (and the stockholders he
represented) from Judge Bergmann’s Order, refused to hear Mr.
Persante’s voluntary deposition testimony referencing the
Restriction Agreement, and lacked jurisdiction to hear the
agreement to arbitrate before AAA.” (Doc. # 71 at 12).
All three arguments fail.
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Jurisdiction of AAA
Simmers argues: “The Arbitrator’s award should  be
vacated because the Arbitrator exceeded his powers by ruling
that this dispute should be arbitrated in AAA as the evidence
showed that this was instead a dispute in which the ‘FINRA
rules and regulations supersede.’” (Doc. # 71 at 22). He
highlights FINRA Rule 13200, which requires a dispute between
arbitration forum “if the dispute arises out of the business
activities of a member or an associated person” unless FINRA’s
supersedes the parties’ contractual agreement to arbitrate
before the AAA. Thus, Simmers reasons, the arbitrator “lacked
jurisdiction over this dispute from its inception because the
supersede any agreement to arbitrate before AAA, the parties
would arbitrate before FINRA.” (Doc. # 71 at 4). 1 Simmers
Simmers notes in his Petition that the arbitrator did not
elaborate in his written order on his finding that the AAA
was the proper arbitral forum under the various arbitration
provisions, besides stating that “FINRA rules and regulations
do not supersede the parties’ agreements to arbitration
before the AAA.” (Doc. # 71 at 22). Even if the Court were to
assume for the sake of argument that this was not a sufficient
explanation of the arbitrator’s reasoning, “[w]here an
arbitrator fails to articulate the rationale for his
decision, [courts] will overturn the award only when it is
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appears to base this argument on Section 10(a)(4), which
“exceeded their powers.” 9 U.S.C. § 10(a)(4).
“While a federal court may vacate an arbitration award
when it ‘exceeds the scope of the arbitrator’s authority,’
few awards are vacated because the scope of the arbitrator’s
authority is so broad.” Wiregrass Metal Trades Council AFLCIO v. Shaw Env’t & Infrastructure, Inc., 837 F.3d 1083, 1087
(11th Cir. 2016) (citations omitted). “The arbitrator acts
within [his] authority when [he] even arguably interprets a
contract, and [he] exceeds [his] authority when [he] modifies
the contract’s clear and unambiguous terms.” Id. at 1088; see
also Oxford Health Plans LLC v. Sutter, 569 U.S. 564, 569
(2013) (“Because the parties bargained for the arbitrator’s
construction of their agreement, an arbitral decision even
regardless of a court’s view of its (de)merits.”).
‘apparent’ that the arbitrator exceeded his authority. ‘A
mere ambiguity in the opinion accompanying an award, which
permits the inference that the arbitrator may have exceeded
his authority, is not a reason for refusing to enforce the
award.’” Barclays Cap. Inc. v. Urquidi, 786 F. App’x 970, 973
(11th Cir. 2019) (quoting Wiregrass Metal Trades Council AFLCIO v. Shaw Env’t & Infrastructure, Inc., 837 F.3d 1083, 1091
(11th Cir. 2016)).
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This Court previously held that the AAA was the entity
empowered to determine arbitrability of the parties’ dispute
based upon the language of the arbitration provisions. See
(Doc. # 33 at 14) (“[T]he Court finds that the language in
evidences the parties’ intent that the arbitrator rule on
gateway issues of arbitrability.”). That is, the Court has
determine whether the parties’ dispute should be arbitrated
reconsider its prior ruling on this issue, and the arbitrator
did not exceed his authority in determining that he should
decide the arbitrability question.
Likewise, the arbitrator here did not exceed his powers
in ruling that the AAA was the proper forum to resolve the
arbitrator’s reading of the arbitration provisions and his
legal conclusion that FINRA rules did not supersede the
arbitration clauses. (Doc. # 71-12 at 2). While Simmers casts
determination that the AAA was the proper forum. Although
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Simmers maintains that the arbitrator erred in concluding
that the AAA was the proper forum, the FAA does not permit
this Court to “look to the legal merits of the underlying
award.” White Springs Agric. Chemicals, Inc. v. Glawson Invs.
Corp., 660 F.3d 1277, 1283 (11th Cir. 2011) (“These points on
exceeded its powers by acting contrary to the law. We cannot,
however, review the panel’s award for underlying legal error.
Even though White Springs presents its argument in terms of
the FAA, it asks us to do what we may not — look to the legal
merits of the underlying award.” (citations omitted)).
arbitrator’s decision on the arbitrability issue fails. See
10759189, at *4 (S.D. Fla. Dec. 26, 2018) (“As this Court
finds that the issues related to whether Respondents owed
anything under the promissory notes was properly before the
arbitration panel, this Court declines to review the legality
of the panel’s award.”), aff’d sub nom. Barclays Cap. Inc. v.
Urquidi, 786 F. App’x 970 (11th Cir. 2019).
Judge Bergmann’s Order
Simmers also argues that the Arbitrator “reached beyond
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Order.” (Doc. # 71 at 13-14). This argument has two parts.
jurisdiction to relieve Dwayne Calton from Judge Bergmann’s
Order because Dwayne Calton never sought relief from that
Order directly.” (Id. at 14). He insists the Interim Award
“overrules Judge Bergmann’s Order, without even mentioning
the Order, by ruling that the Sellers including Dwayne Calton
were not directly bound by the Restriction Agreement.” (Id.
“exceeded his powers by making findings based on Plaintiffs’
collateral attack of Judge Bergmann’s Order.” (Id.). Again,
Simmers appears to rely on Section 10(a)(4), which provides
that vacatur is appropriate if the arbitrator “exceeded their
powers.” 9 U.S.C. § 10(a)(4).
arbitrator’s authority,’ few awards are vacated because the
scope of the arbitrator’s authority is so broad.” Wiregrass
Metal Trades Council AFL-CIO, 837 F.3d at 1087 (citations
omitted). Arguments that an arbitrator “exceeded its powers
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by acting contrary to the law” are to no avail. White Springs
Agric. Chemicals, Inc., 660 F.3d at 1283. This is because
courts cannot review an arbitrator’s award “for underlying
legal error” and cannot “look to the legal merits of the
underlying award.” Id.
Here, after interpreting the language of the various
agreements, the arbitrator held that Simmers lacked standing
to enforce the ART because he was not a party to the ART, the
SPA and MOU did not incorporate the ART, and the MOU did not
make Simmers a party to the SPA. (Doc. # 59-1 at 7-9).
Likewise, the arbitrator held that Simmers’ claims related to
the various agreements must be dismissed for failure to
include the indispensable party Aatria. (Id. at 9-10). These
were the primary reasons the arbitrator denied Simmers relief
for his claims involving the SPA, SOA, MOU, and ART, and these
reasons are not affected by the existence of Judge Bergmann’s
order in the divorce case. Thus, Simmers cannot show that the
Plaintiffs despite Judge Bergmann’s order.
Even as to the arbitrator’s additional ruling that the
ART’s transfer restrictions were waived and abandoned because
the parties to the ART never followed them, Simmers has not
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argument regarding Judge Bergmann’s order essentially posits
that the arbitrator made a legal error when the arbitrator
did not hold that Judge Bergmann’s order precluded a finding
that the ART was waived. That is, Simmers asks this Court to
underlying award.” White Springs Agric. Chemicals, Inc., 660
F.3d at 1283.
Simmers fails to overcome the presumption in favor of
confirming the arbitration award based on this argument.
Mr. Persante’s Deposition
According to Simmers, the Arbitrator “exacerbated his
jurisdictional error of reaching the issue of the historical
treatment of the Restriction Agreement by refusing to hear
Simmers’ evidence material to that issue.” (Doc. # 71 at 19).
Simmers insists that the arbitrator should have allowed him
to read into the record certain excerpts from the transcript
of Mr. Persante — Plaintiffs’ counsel in this case — that
were taken during the separate arbitration between Plaintiffs
and Aatria, LLC. (Id. at 20). “The Arbitrator denied that
request [to read in portions of the transcript] over Simmers’
objection that the exclusion of the evidence prejudiced his
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Section 10(a) permits vacatur “where the arbitrators
were guilty of misconduct . . . in refusing to hear evidence
10(a)(3). But “an award is only vacated for refusing to
consider evidence when an arbitrator’s error is ‘in bad faith
or so gross as to amount to affirmative misconduct.’” Fowler
v. Ritz-Carlton Hotel Co., LLC, 579 F. App’x 693, 698 (11th
Cir. 2014) (quoting United Paperworkers Inten. Union, AFL–
CIO v. Misco, Inc., 484 U.S. 29, 40 (1987)); see also Pochat
v. Lynch, No. 12-22397-CIV, 2013 WL 4496548, at *10 (S.D.
Fla. Aug. 22, 2013) (“With respect to Section 10(a)(3) in
particular, courts have emphasized that this subsection does
plaintiff must show that the arbitrator’s handling of these
affirmative misconduct, effectively depriving the plaintiff
of a fundamentally fair proceeding.”). The Court is mindful
that “[a]rbitrators enjoy wide latitude in conducting an
arbitration hearing, and they are not constrained by formal
rules of procedure or evidence.” Rosensweig v. Morgan Stanley
& Co., 494 F.3d 1328, 1333 (11th Cir. 2007) (citation and
internal quotation marks omitted). “In addition, [a] federal
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arbitrator’s refusal to hear pertinent and material evidence
prejudices the rights of the parties to the arbitration
cumulative. (Doc. # 74-2 at 1205-08). He noted that (1)
Plaintiffs had stipulated to the entire record of the divorce
case, (2) the parties could direct the arbitrator to relevant
evidence because “[a]ll of the underlying facts, records,
arguments before tribunals, whether it be to the court or to
arbitrators, have been transcribed,” and (3) the arbitrator
did not believe that “any additional facts that are not in
those records and any legal argument that [Mr. Persante] would
have made or representation that he would have made to a
significant” would exist. (Id. at 1205-06). The arbitrator
Plaintiffs by keeping their counsel from becoming a witness
in the case but still allowed Simmers to “point or read or
put in any portion of the record, whether it be from the
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proceedings, that [Simmers] believe[d] [would] point out and
establish some inconsistency or argument that [he] want[ed]
to make.” (Id. at 1208).
Such reasoning does not constitute a gross error that
would warrant vacatur, as there was a reasonable basis for
the arbitrator’s evidentiary ruling. Furthermore, Simmers has
not presented any evidence that the arbitrator acted in bad
faith in reaching this ruling. Finally, as Plaintiffs point
out (Doc. # 77 at 16), Simmers merely identifies a single
brief passage from the deposition that he considers important
— Mr. Persante’s statement that he “certainly would have made
sure [whatever he told the judge in the divorce action] was
right.” (Doc. # 71 at 21; Doc. # 71-11 at 84). Simmers has
not shown that he suffered prejudice from the exclusion of
Vacatur Arguments for Fees and Costs
Finally, Simmers seeks to vacate the Final Award’s award
of attorney’s fees and costs for Plaintiffs. (Doc. # 82). He
argues this award should be vacated because
(1) the AAA Arbitrator (“Arbitrator”) exceeded his
powers by awarding fees that were not in his
jurisdiction; (2) AAA Commercial Arbitration Rule
47(d)(ii), which authorizes ‘an award of attorneys’
fees if all parties have requested such an award,’
does not create an independent basis for awarding
fees to a prevailing party in an arbitration
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proceeding that does not otherwise exist in statute
or contract; and (3) based on the documents that
were filed in the Arbitration, there was no
adequate fee-shifting provision(s) to cause Simmers
to be responsible for the entire amount of
attorneys’ fees, taxable costs, and administrative
(Doc. # 82 at 2). Thus, it appears that Simmers is basing
this Motion on Section 10(a)(4), which provides that vacatur
is appropriate if the arbitrator “exceeded their powers.” 9
U.S.C. § 10(a)(4).
Simmers’ arguments fail. Again, this Court has already
held that the various agreements at issue incorporated the
AAA’s rules. (Doc. # 33 at 13-14); see also JPay, Inc. v.
Kobel, 904 F.3d 923, 937 (11th Cir. 2018) (reiterating that
incorporating the AAA Rules in an arbitration agreement was
questions of arbitrability because the AAA rules “gave the
arbitrator ‘the power to rule on his or her own jurisdiction,
scope, or validity of the arbitration agreement’” (citation
omitted)); Airbnb, Inc. v. Doe, 336 So. 3d 698, 704 (Fla.
2022) (holding that the parties “clearly and unmistakably
agreed that an arbitrator decides questions of arbitrability”
where Airbnb’s terms of service explicitly incorporated by
reference the AAA Rules, and stating that “when an agreement
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incorporates a set of arbitral rules, such as the AAA Rules,
those rules become part of the agreement”), cert. denied, No.
22-102, 2022 WL 17408176 (U.S. Dec. 5, 2022).
And one such rule is AAA Commercial Rule R-47(d)(ii):
“The award of the arbitrator(s) may include: . . . (ii) an
award of attorneys’ fees if all parties have requested such
an award or it is authorized by law or their arbitration
added) 2; see also Fowler, 579 F. App’x at 699 (explaining that
the AAA rules “explicitly allow the arbitrator to award
attorney’s fees and costs” and that it was “meritless” for
the petitioner to argue “that the arbitrator exceeded her
authority by awarding costs and attorney’s fees”).
Here, Plaintiffs requested an award of attorney’s fees
and costs in their demand for arbitration. (Doc. # 85-2 at
arbitration contains a similar request under the heading
“Notice of Intent to Seek Attorneys’ Fees”: “John Simmers
At the time of the Final Award, the relevant section of the
AAA Commercial Rules was numbered as Rule 47(d)(ii).
Subsequently, although the substance of the rule remains the
https://www.adr.org/sites/default/files/Commercial RulesWeb.pdf. Likewise, before this case was initiated, this rule
was previously numbered as Rule 43(d)(ii) in an earlier
version of the AAA Commercial Rules.
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gives notice of his intent to seek an award of his reasonable
attorneys’ fees pursuant to all statutes, contracts, and
Association determine that his claims must proceed in this
forum and in the event John Simmers prevails in this matter.”
(Doc. # 85-1 at 94); see also (Doc. # 85-4 at 3-4) (Simmers’
prehearing brief, in which he explicitly requests attorney’s
fees as to twelve of the thirteen remaining counts of his
attorney’s fees and costs be awarded to him if he prevailed
— was not a “request” for purposes of AAA Rule 47(d)(ii).
(Doc. # 82 at 15). But the language in his counterclaim is
attorneys’ fees must still be present in a statute or a
contract,” even if all parties requested fees during the
47(d)(ii) does not create an independent basis for attorneys’
fees.” (Id.). Simmers is incorrect. The parties’ requests for
fees itself empowered the arbitrator to award fees and costs,
as each of the three bases for awarding attorney’s fees is
independent in Rule 47(d)(ii). See AAA Commercial Rule R25
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47(d)(ii) (explaining that attorney’s fees may be awarded if
“all parties have requested such an award or it is authorized
by law or their arbitration agreement” (emphasis added)); see
also CareMinders Home Care, Inc. v. Sandifer, No. 1:14-CV03573-WSD, 2015 WL 4040464, at *4 (N.D. Ga. June 29, 2015)
(“Both parties having requested an award of attorneys’ fees,
Rule 43(d)(ii) of the Commercial Rules applies, and the
Arbitrator thus had the authority to include attorneys’ fees
in the Award and did not exceed his powers under Section
10(a)(4) of the FAA. Even if the Court assumes that the
Arbitrator’s decision to award attorneys’ fees under Section
18.3 of the Franchise Agreement was in error, Rule 43(d)(ii)
Franchise Agreement, independently empowered the Arbitrator
to award attorneys’ fees, and the Award is required to be
confirmed for this reason.”); Wells Fargo Bank, N.A. v. WMR
e-PIN, EEC, 653 F.3d 702, 713 (8th Cir. 2011) (rejecting
argument that arbitrator misapplied contractual provision and
requested an award of attorneys’ fees, and the arbitrator was
authorized to consider the request under Rule 43(d)(ii) of
the Commercial Rules); Ltd. v. Indyzen, Inc., 851 F. App’x
54, 55–56 (9th Cir. 2021) (“The arbitrator did not exceed his
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powers in holding Mak personally liable for the award of
Commercial Arbitration Rule 47(d)(ii), an arbitrator’s award
attorney’s fees prior to the award. All parties, including
therefore award attorney’s fees and hold Mak, as a nonprevailing party to the arbitration, responsible for paying
As to Simmers’ argument that the arbitrator’s fees award
included fees incurred in this Court and in the FINRA action
in violation of Florida law, this argument alleges a legal
error by the arbitrator. But, again, the FAA does not permit
this Court to “look to the legal merits of the underlying
award.” White Springs Agric. Chemicals, Inc., 660 F.3d at
1283 (“These points on appeal essentially involve the same
argument: the panel exceeded its powers by acting contrary to
the law. We cannot, however, review the panel’s award for
underlying legal error. Even though White Springs presents
its argument in terms of the FAA, it asks us to do what we
may not—look to the legal merits of the underlying award.”
(citations omitted)); see also CareMinders Home Care, Inc.,
2015 WL 4040464, at *5 (“Respondents simply argue that the
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Arbitrator would not have awarded attorneys’ fees if he had
applied Georgia law correctly. That is not a reviewable claim
under the FAA’s highly deferential standard.”). Thus, this
argument fails. 3
The Petition to Vacate the Fee Award is denied.
Accordingly, it is now
ORDERED, ADJUDGED, and DECREED:
Plaintiffs’ Motion to Confirm Interim Arbitration Award
(Doc. # 59) is GRANTED.
Defendant John Simmers’ Petition to Vacate Arbitration
Award (Doc. # 71) is DENIED.
Defendant John Simmers’ Petition to Vacate the Fee Award
(Doc. # 82) is DENIED.
The Clerk is directed to CLOSE the case.
Even if the Court could consider the argument, Simmers has
not carried his burden of proof. The only case Simmers cites
for this argument is a Florida opinion holding that a trial
court cannot award appellate attorney’s fees unless the
appellate court has authorized such an award. (Doc. # 82 at
10-11) (citing Rados v. Rados, 791 So. 2d 1130, 1131 (Fla. 2d
DCA 2001)). Thus, the procedural posture in that case is
wholly different from the one presented here.
Case 8:20-cv-00851-VMC-CPT Document 90 Filed 01/17/23 Page 29 of 29 PageID 7323
DONE and ORDERED in Chambers in Tampa, Florida, this
17th day of January, 2023.
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