Anwar et al v. Fairfield Greenwich Limited et al

Filing 1147

ENDORSED LETTER addressed to Judge Victor Marrero from Sharon L. Nelles dated 6/5/2013 re: Counsel for Standard Chartered Bank International (Americas) Ltd. write this letter in reply to plaintiff Ricardo Rodriguez Caso's 5/30/2013 letter to the Court. ENDORSEMENT: The Clerk of Court is directed to enter into the public record of this action the letter above submitted to the Court by Standard Chartered defendants. (Signed by Judge Victor Marrero on 6/5/2013) Filed In Associated Cases: 1:09-cv-00118-VM-FM, 1:10-cv-09196-VM(tro) Modified on 6/7/2013 (tro).

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By Facsimile to Court and COWlsel
Honorable Victor Marrero,
United States District Judge,
Daniel Patrick Moynihan United States Courthouse,
500 Pearl Street,
New York, New York 10007.
Re:

Anwar, eta!' v.FairfieldGreenwich Ltd., etal., No. 09-CV-118
(S.D.N. Y.) -- Caso v. Standard Chartered Bank International
(Americas) Ltd., et al.! No. 10-CV-9196 (S.D.N.Y.)

Dear Judge Marrero:
We write on behalf of Standard Chartered Bank. IntemationaJ (Americas) Ltd. (the
"Bank") in reply to plaintiff Ricardo Rodriguez Caso's May 30, 2013 letter to the Court. Mr.
Caso argues that this Court (1 ) pennitted class arbitration in its May 18, 2012 Order (Letter at 2),
and (2) lacked the authority to preclude class arbitration (Letter at 2-3). Mr. Caso is incorrect
First, the Court's May 18 Order permitted only individual arbitration. The Bank
moved to compel arbitration only of Mr. Caso's individual claims, and that is the motion the
Court granted. Indeed, Mr. Caso did not dispute then that the NISA authorizes only individual
arbitration (see Dkt. Nos. 771, 772, 880), and the Court certainly did not rule that Mr. Caso was
pennitted to proceed with class-wide arbitration when concluding that the NISA "does not
contain a clause prohibiting enforcement of arbitration against a putative class plaintiff," and
thus there was "no impediment to arbitrability" of Mr. Caso's individual claim. (May 18 Order at
3, Dkt. No. 882.) Rather, the Court's ruling was fully in accord with the Federal Arbitration Act
(the "FAA"), which calls for a court to compel arbitration only upon motion of a party and only
"in accordance with the tenns of the agreement:' 9 U.S.C. § 4. The Court was not presented
with My motion to refer the claims of the putative class to arbitration, and could not have done
so in any event because the parties' agreement does not expressly authorize class arbitration. See
Stolt-Nielsen SA. v. AnimalFeeds Int'[ Corp., 130 S. Ct. 1758, 1775-76 (2010); In re Am.
Express Merchants' Litig.) 667 F.3d 204, 219 (2d CiT. 2012) (UStolt-Nielsen plainly precludes
any court from compelling the parties to submit to class-wide arbitration where the arbitration

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Honorable Victor Marrero
clause is silent as to class-wide arbitration."); see Anwar v. Fairfield Greenwich Ltd., 728 F.
Supp. 2d 462,477 (S.D.N.Y. 2010) (,ICelass action arbitration changes the nature of arbitration
to such a degree that it cannot be presumed the parties consented to it simply by agreeing to
submit their disputes to an arbitrator. '" (quoting Stolt-Nielsen, 130 S. Ct. at 1775)).

Second, the Court had (and has) clear authority to detennine gateway issues of
arbitrability) including whether Mr. Caso can be compelled to individual, and not class,
arbitration. See, e.g., In re Am. Express Merchants' Litig., 667 F.3d at 210 ("the issue of the
class action waiver's enforceability was a matter for the court, not the arbitrator"); Ryan v. JP.
Morgan Chase & Co., 2013 WI.. 646388, at ·5-6 (S.D.N.V. Feb. 21, 2013) (compelling putative
class plaintiff to individual arbitration before AAA); Sanders v. Forex Capital MIas., LLC, 2011
WL 5980202, at *1, 10 (S.D.N.Y. Nov. 29, 2011) (compelling putative class plaintiff to
individual arbitration); cf Sutherland v. Ernst & Young LLP, 768 F. Supp. 2d 547,554
(S.D.N.Y. 2011) (denying motion to compel class arbitration where agreement "silent as to
whether class arbitration is permissible"). Mr. Caso does not dispute that the question of
whether class arbitration is pennitted is nonnal1y one for the court to detennine. Instead, Mr.
Caso argues that because the NISA provides for AAA rules to govern any arbitration, the parties
somehow agreed to commit the question of the permissibility of class arbitration to the
arbitrators. (Letter at 2-3.) What Mr. Caso ignores, however, is that, although the AAA's
Supp1ementary Rules for Class Arbitration require an arbitrator, presented with a putative class
claim that has not been addressed by a court, to decide whether class arbitration is pennitted, the
rules make plain that "[wJhenever a court has, by order, addressed and resolved any matter that
would otherwise be decided by an arbitrator under these Supplementary Rules, the arbitrator
shall follow the order of the court." Rule 1(c), In other words, the rules expressly contemplate
that a court may decide the issue first. The parties thus cannot be said to have "clearly and
unmistakably" agreed to have arbitrators decide whether class claims are arbitrable based on the
AAA rules. First Options ofChicago. Inc. v. Kaplan, 514 U.S. 938, 944 (I 995).
Finally, Mr. Caso's reliance on the Second Circuit's unpublished opinion in

Emilio v. Sprim Spectrum L.P., 2013 WL 203361 (2d Cir. Jan. 18,2013), is misplaced. Emilio
concerned review of a final arbitral award where the parties had submitted and litigated the issue
of class arbitration to the arbitrator. Id. at +: 1. The Second Circuit held that because the parties
did not dispute that they had delegated questions ofarbitrability to the arbitrator, the district
court was required to defer to the arbitrator'S resolution those questions. Id. at *2-3. Here, the
Court detennined that Mr. Caso's individual claim was referable to arbitration. Nothing in
Emilio prevents this Court from enforcing that order. And to the extent Mr. Caso's position is
that the Court should refer class claims to arbitration now, that request should be denied under
Stolt-Nielsen. and nothing in Emmo prevents that either.
Respectfully submitted,
The Clerk of Court is dir.ected to enter into the public record
of this action the letter above SUbl~ to the Court by

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SQORDERED.

Va --J- 13.
DATE'

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Sharon L. Nelles