Murray v. UBS Securities, LLC et al
Filing
44
OPINION AND ORDER re: 37 MOTION to Amend/Correct the Courts January 27, 2014 Decision and Order, pursuant to 28 U.S.C. § 1292(b) and Fed. R. App. P. 5(a)(3), filed by Trevor Murray... With none of the Section 1292(b) requirements met, a nd this case being far from an "exceptional" case that would warrant an interlocutory appeal, the Court declines to grant certification. For the foregoing reasons, Plaintiff's motion is DENIED. The Clerk of Court is directed to terminate Docket Entry 37, and keep this case on the suspense calendar. SO ORDERED. (Signed by Judge Katherine Polk Failla on 4/1/2014) (ja)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
----------------------------------------------------------X
:
TREVOR MURRAY,
:
:
Plaintiff,
:
:
v.
:
:
UBS SECURITIES, LLC AND UBS AG,
:
:
Defendants.
:
:
----------------------------------------------------------X
USDC SDNY
DOCUMENT
ELECTRONICALLY FILED
DOC #: _________________
April 1, 2014
DATE FILED: ______________
12 Civ. 5914 (KPF)
OPINION AND ORDER
KATHERINE POLK FAILLA, District Judge:
On January 27, 2014, this Court issued an order (the “January 27
Order”) granting Defendants’ motion to compel arbitration of this action, and
staying the action pending resolution of that arbitration. The Court’s decision
to stay the action effectively prevented the parties from appealing the
January 27 Order. Plaintiff now moves, pursuant to 28 U.S.C. § 1292(b) and
Federal Rule of Appellate Procedure 5(a)(3), for an order amending the January
27 Order to permit Plaintiff to petition the United States Court of Appeals for
the Second Circuit for an immediate interlocutory appeal of certain sections of
that Order. Because Plaintiff has not satisfied the statutory requirements for
Section 1292(b) certification, his motion for amendment and certification for
interlocutory appeal is denied.
BACKGROUND 1
A.
The Underlying Litigation
On August 2, 2012, Trevor Murray filed this action against UBS
Securities, LLC, and UBS AG (collectively, “Defendants”) under 15 U.S.C.
§ 78u-6(h), the anti-retaliation provision (the “Anti-Retaliation Provision”) of the
Dodd-Frank Wall Street Reform and Consumer Act of 2010, Pub. L. No. 111203, 124 Stat. 1376 (“Dodd-Frank”). (Dkt. #1). In short, Plaintiff alleged that
Defendants violated the Anti-Retaliation Provision in terminating Plaintiff’s
employment after, and as a result of, Plaintiff making certain disclosures
protected under Section 806 of the Sarbanes-Oxley Act of 2002, Pub. L. No.
107-204, 116 Stat. 745 (“Sarbanes-Oxley”). (See id.)
B.
The Motion to Compel Arbitration and the January 27 Order
On June 14, 2013, Defendants moved pursuant to the Federal
Arbitration Act (the “FAA”), 9 U.S.C. §§ 1-14, to compel Plaintiff to arbitrate the
claim raised in his Complaint in accordance with Plaintiff’s employment
agreement with UBS AG (the “Employment Agreement”) and with the Uniform
Application for Securities Industry Registration or Transfer (“Form U-4”) that
Plaintiff completed as a condition of his employment. (Dkt. #27). In Plaintiff’s
opposition, filed on July 19, 2013, he argued that (i) his claim — which he
contended arose under Sarbanes-Oxley, and not the Anti-Retaliation
Provision — was not arbitrable because the Employment Agreement and Form
1
The Court assumes familiarity with the facts of this case as set forth in the January 27
Order. (Dkt. #36). In this Opinion, Plaintiff’s supporting memorandum is referred to as
“Pl. Br.”; Defendants’ memorandum in opposition is referred to as “Def. Opp.”; and
Plaintiff’s reply memorandum is referred to as “Pl. Reply.”
2
U-4 exempted Plaintiff’s claim from arbitration, and (ii) mandatory arbitration
of his action was precluded as a matter of law under Sarbanes-Oxley’s
prohibition of predispute arbitration agreements. (Dkt. #34). The motion was
fully submitted on August 2, 2013, when Defendants filed their reply. (Dkt.
#35).
The Court’s January 27 Order, as noted, granted Defendants’ motion to
compel arbitration of this action and stayed the action pending resolution of
the arbitration. Murray v. UBS Sec., LLC, No. 12 Civ. 5914 (KPF), 2014 WL
285093, at *14 (S.D.N.Y. Jan. 27, 2014). In so doing, the Court issued two
rulings that Plaintiff seeks to appeal. First, in Section 2(b)(i) of the Order, the
Court held that Plaintiff’s claim arises under the Anti-Retaliation Provision,
which does not include a prohibition against predispute arbitration
agreements, and not under Sarbanes-Oxley. Id. at *9. As support, the Court
noted that Plaintiff’s Complaint recited only a violation of the Anti-Retaliation
Provision; it stated that the Court’s jurisdiction arose under the AntiRetaliation Provision; and it demanded the enhanced remedy only available
under the Anti-Retaliation Provision. Id. Further proof that Plaintiff had not
brought a claim under Sarbanes-Oxley included the fact that Plaintiff had not
exhausted his statutorily mandated administrative remedies for a SarbanesOxley claim, as evidenced by his pending claim with the Occupational Safety
and Health Administration of the Department of Labor (“OSHA”). Id. Second,
in Section 2(b)(ii) of the Order, the Court held that Plaintiff’s claim was not
within the exceptions in the parties’ arbitration agreements (i.e., the
3
Employment Agreement and Form U-4) because those agreements precluded
arbitration of claims under Sarbanes-Oxley, which, the Court had just held,
Plaintiff’s was not. Id. at *10.
The Court stayed, rather than dismissed, the action pending resolution
of the arbitration, in accordance with the Second Circuit’s admonitions in
Salim Oleochemicals v. M/V Shropshire, 278 F.3d 90, 93 (2d Cir. 2002)
(instructing that “[d]istrict courts should continue be mindful of this liberal
policy favoring arbitration agreements,” and that “unnecessary delay of the
arbitral process through appellate review is disfavored”). Murray, 2014 WL
285093, at *14. Because the Court’s decision to stay the action precluded the
parties from appealing the January 27 Order, on February 27, 2014, Plaintiff
filed the pending motion requesting that the Court amend the Order to include
language that would permit Plaintiff to petition the Second Circuit for an
immediate interlocutory appeal of Sections B(2)(i) and (ii) of the Order. (Dkt.
#37). Defendant filed an opposition on March 3, 2014 (Dkt. #42), and on
March 7, 2014, the motion was fully submitted when Plaintiff filed his reply
(Dkt. # 43). 2
2
Plaintiff argues that the Court should not consider Defendants’ opposition because it
was untimely filed by three days. (Pl. Reply 3). Although Defendants’ opposition was
untimely, its untimeliness was minimal, did not prejudice Plaintiff, and did not impact
the resolution of this motion. In the interest of justice and in order to have a complete
record, the Court will consider Defendants’ opposition. Quiroz v. U.S. Bank Nat. Ass’n,
No. 10 Civ. 2485 (KAM) (JMA), 2011 WL 3471497, at *1 (E.D.N.Y. Aug. 5, 2011) (“For
purposes of having a complete record, however, the court will consider these
submissions.”); Evans v. Port Auth. of New York and New Jersey, 192 F. Supp. 2d 247,
251 n.5 (S.D.N.Y. 2002) (considering untimely submissions).
4
DISCUSSION
A.
Applicable Law
Section 16(b) of the FAA provides generally that “an appeal may not be
taken from an interlocutory order ... granting a stay of any action under section
3 of this title,” 9 U.S.C. § 16(b)(1), or “compelling arbitration under section 206
of this title,” id. § 16(b)(3). The Second Circuit has recognized that this
provision “furthers [the FAA’s] aim of eliminating barriers to arbitration by
promoting appeals from orders barring arbitration and limiting appeals from
orders directing arbitration.” Ermenegildo Zegna Corp. v. Zegna, 133 F.3d 177,
180 (2d Cir. 1998) (internal quotation marks and brackets omitted).
Section 16(b) permits appellate review of orders that a district court
certifies for interlocutory appeal pursuant to 28 U.S.C. § 1292(b). See 9 U.S.C.
§ 16(b) (“Except as otherwise provided in section 1292(b) of title 28, an appeal
may not be taken from an interlocutory order....”); 28 U.S.C. § 1292(b) (noting
that, upon certification as an interlocutory appeal from the district court, the
relevant Court of Appeals may, “in its discretion, permit an appeal to be taken
from such order” (emphasis added)); see generally Accenture LLP v. Spreng, 647
F.3d 72, 74-75 (2d Cir. 2011) (concluding that the Second Circuit lacked
jurisdiction to review an order refusing to enjoin arbitration that the district
court had not certified for immediate interlocutory review). Under Section
1292(b), a district court may certify an order for interlocutory appeal when it is
“of the opinion that such order [i] involves a controlling question of law [ii] as to
which there is substantial ground for difference of opinion and [iii] that an
5
immediate appeal from the order may materially advance the ultimate
termination of the litigation.” 28 U.S.C. § 1292(b); see also Casey v. Long
Island R.R. Co., 406 F.3d 142, 145-46 (2d Cir. 2005). 3 Section 1292(b) must be
strictly construed because “the power to grant an interlocutory appeal must be
strictly limited to the precise conditions stated in the law.” Klinghoffer v. S.N.C.
Achille Lauro, 921 F.2d 21, 25 (2d Cir. 1990) (internal quotation marks and
brackets omitted). The movant bears the burden of demonstrating that all
three of the substantive criteria are met. See Casey, 406 F.3d at 146 (“[Section
1292(b)], by its terms, thus imposes both procedural and substantive
requirements on a would-be appellant.”).
“It is a basic tenet of federal law to delay appellate review until a final
judgment has been entered.” Koehler v. Bank of Bermuda LTD, 101 F.3d 863,
865 (2d Cir. 1996). In that regard, “‘federal practice strongly disfavors
discretionary interlocutory appeals [as they] prolong judicial proceedings, add
delay and expense to litigants, burden appellate courts, and present issues for
decisions on uncertain and incomplete records, tending to weaken the
precedential value of judicial opinions.’” S.E.C. v. Straub, No. 11 Civ. 9645
(RJS), 2013 WL 4399042, at *2 (S.D.N.Y. Aug. 5, 2013) (quoting In re World
Trade Ctr. Disaster Site Litig., 469 F. Supp. 2d 134, 144 (S.D.N.Y. 2007)); see
3
Federal Rule of Appellate Procedure 5(a)(3) provides the avenue by which a district court
may amend its order to grant a party permission to petition for an interlocutory appeal:
If a party cannot petition for appeal unless the district court first
enters an order granting permission to do so or stating that the
necessary conditions are met, the district court may amend its
order, either on its own or in response to a party’s motion to
include the required permission or statement.
Fed. R. App. P. 5(a)(3).
6
also Glatt v. Fox Searchlight Pictures, Inc., No. 11 Civ. 6784 (WHP), 2013 WL
5405696, at *1 (S.D.N.Y. Sept. 17, 2013) (“Interlocutory appeals are strongly
disfavored in federal practice”). The Second Circuit has further emphasized
that Section 1292(b) certification should be “strictly limited because ‘only
exceptional circumstances [will] justify a departure from the basic policy of
postponing appellate review until after the entry of a final judgment.’” In re
Flor, 79 F.3d 281, 284 (2d Cir. 1996) (quoting Klinghoffer, 921 F.2d at 25).
“Section 1292(b) was not intended to open the floodgates to a vast
number of appeals from interlocutory orders in ordinary jurisdiction, or to be a
vehicle to provide early review of difficult rulings in hard cases.” Lidle v. Cirrus
Design Corp., No. 08 Civ. 1253 (BSJ) (HBP), 2010 WL 4345733, at *2 (S.D.N.Y.
Oct. 29, 2010) (internal quotation marks omitted). So as to uphold that
principle, a district court should “exercise great care in making a [Section]
1292(b) certification,” Westwood Pharm., Inc. v. Nat’l Fuel Gas Distrib. Corp.,
964 F.2d 85, 89 (2d Cir. 1992), and only grant a motion for certification in
“exceptional cases where early appellate review might avoid protracted and
expensive litigation,” In re Buspirone Patent Litig., 210 F.R.D. 43, 49 (S.D.N.Y.
2002) (internal quotation marks omitted). “[E]ven where the three legislative
criteria of Section [] 1292(b) appear to be met, district courts retain unfettered
discretion to deny certification if other factors counsel against it.” In re
Facebook, Inc., IPO Sec. and Derivative Litig., No. 12 Civ. 2389 (RWS), 2014 WL
988549, at *2 (S.D.N.Y. Mar. 13, 2014); Transp. Workers Union of Am., Local
7
100 v. New York City Transit Auth., 358 F. Supp. 2d 347, 351 (S.D.N.Y Feb. 25,
2005).
B.
Analysis
1.
The January 27 Order Did Not Involve a Controlling
Question of Law
“[A] question of law is ‘controlling’ if reversal of the district court’s order
would terminate the action.” Klinghoffer, 921 F.2d at 24. The Second Circuit
has identified, as examples, orders involving “issues of in personam and
subject matter jurisdiction.” Id. When making this determination, a district
court should also consider whether “reversal of the district court’s opinion,
even though not resulting in dismissal, could significantly affect the conduct of
the action; or, the certified issue has precedential value for a large number of
cases.” Dev. Specialists, Inc. v. Akin Gump Strauss Hauer & Feld LLP, No. 11
Civ. 5994 (CM), 2012 WL 2952929, at *4 (S.D.N.Y. July 18, 2012); accord
Peters v. Jinkosolar Holding Co., Ltd., No. 11 Civ. 7133 (JPO), 2012 WL 946875,
at *14 (S.D.N.Y Mar. 19, 2012).
The Court’s holdings at Section B(2)(i) and (ii), i.e., that Plaintiff’s claim
arises under the Anti-Retaliation Provision and does not fall within the
exceptions to arbitration in the parties’ agreements, do not satisfy these
criteria. Reversal of either one of these decisions would not terminate the
action, but rather would return the action to this Court for litigation. To be
sure, reversal could affect the “conduct” of the action by eliminating the
arbitration, but such a consequence is not sufficient to warrant certification.
Indeed — and as certainly contemplated by Congress in enacting, and then
8
clarifying, Section 16(b) — courts in this Circuit have denied motions for
certification where reversals of the orders at issue would have allowed the
parties to forgo arbitration entirely. See, e.g., Levitt v. Lipper Holdings, LLC, No.
03 Civ. 266 (RO), 2006 WL 944450, at *1 (S.D.N.Y. Apr. 12, 2006) (denying
motion for certification for interlocutory appeal of an order compelling the
parties to arbitrate); Ryan, Beck & Co., LLC v. Fakih, 275 F. Supp. 2d 393, 398
(E.D.N.Y. 2003) (same); Martens v. Smith Barney, Inc., 238 F. Supp. 2d 596,
602 (S.D.N.Y. 2002) (same); see also In re XO Commc’n, Inc., No. 03 Civ. 1898
(DC), 2004 WL 360437, at *6 (S.D.N.Y. Feb. 26, 2004) (denying motion for
certification for interlocutory appeal of an order from the bankruptcy court
compelling the parties to arbitrate).
The Court doubts that the January 27 Order will have precedential value
over a large number of cases, especially considering that it is not aware, and
Plaintiff does not point to, any similar pending cases. 4 Even if it would, under
the assumption that because a large sector of the financial industry enters into
the agreements at issue, more disputes like this are bound to be filed, this fact
alone would not warrant certification. As the Second Circuit has instructed:
“[T]he impact that an appeal will have on other cases is a factor that we may
take into account in deciding whether to accept an appeal that has been
properly certified by the district court. But that is not the same as defining a
‘controlling question of law’ in terms of its precedential value.” Klinghoffer, 921
4
The Court notes that Plaintiff’s argument as to the “controlling question of law” prong of
the Section 1292(b) inquiry is in tension with his argument as to the “substantial
ground for difference of opinion” prong, viz., that review is necessary because of the
paucity of cases on the subject. (See Pl. Br. 4-6).
9
F.2d at 24. Accordingly, the first requirement for Section 1292(b) certification
is not present. See Ryan, Beck & Co., LLC, 275 F. Supp. 2d at 396 (denying
motion for certification for interlocutory appeal of an order requiring the parties
to arbitrate; holding that the issue of arbitrability was not “controlling” because
the movant “made no showing that reversal of the Court’s limited ruling would
either result in dismissal, significantly affect the conduct of the case, or have
precedential value for a large number of cases” (internal quotation marks
omitted)).
Although the Court could stop here, see Straub, 2013 WL 4399042, at *2
(“These three criteria are ‘conjunctive, not disjunctive,’ and courts may only
certify an interlocutory appeal where all three are satisfied.”), in the interest of
being cautious and prudent, it will assess the remaining two requirements.
2.
There Is Not a Substantial Ground for Difference of
Opinion Concerning the Questions of Law Addressed in
Sections B(2)(i) and (ii)
A substantial ground for difference of opinion exists “when ‘[i] there is
conflicting authority on the issue, or [ii] the issue is particularly difficult and of
first impression for the Second Circuit.’” Capitol Records, LLC v. Vimeo, LLC,
No. 09 Civ. 10101 (RA), 2013 WL 6869648, at *10 (S.D.N.Y. Dec. 31, 2013)
(quoting In re Enron Corp., No. 06 Civ. 7828 (SAS), 2007 WL 2780394, at *1
(S.D.N.Y. Sept. 24, 2007)). Neither of these requirements is satisfied here.
Contrary to Plaintiff’s assertions (Pl. Br. 4), there is not conflicting
authority on this issue. In support of his argument, Plaintiff points to Holmes
v. Air Liquide USA LLC, No. H-11-2580, 2012 WL 267194 (S.D. Tex. Jan. 30,
10
2012), a Southern District of Texas decision, and Ruhe v. Masimo Corp., No.
SACV 11-00734-CJC (JCGx), 2011 WL 4442790 (C.D. Cal. Sept. 16, 2011), a
Central District of California decision. The court in Ruhe concluded that
Sarbanes-Oxley’s anti-arbitration provision did not apply to the AntiRetaliation Provision, 2011 WL 4442790, at *4, and this Court relied on that
opinion in its January 27 Order. The Holmes and Ruhe decisions are not in
conflict, however, because the court in Holmes did not address the issue of
whether the plaintiff’s claim arose under the Anti-Retaliation Provision.
The plaintiff in Holmes brought claims under the Americans with
Disabilities Act and Title VII of the Civil Rights Act, among other laws
prohibiting discrimination. Holmes, 2012 WL 267194, at *1. In an effort to
avoid arbitrating her claims, the plaintiff argued that the arbitration provision
at issue was rendered invalid by sections of Dodd-Frank amending the
Commodities Exchange Act, 7 U.S.C. § 26(n)(2), and Sarbanes-Oxley, 18 U.S.C.
§ 1514A(e). Id. at 4. Specifically, the plaintiff maintained, “if an arbitration
agreement requires arbitration of disputes arising under those sections, then
the entire agreement is invalid and no dispute (including disputes not arising
under the relevant sections and entirely unrelated to Dodd-Frank) is subject to
[arbitration].” Id.
The plaintiff in Holmes relied not at all on the Anti-Retaliation Provision.
See 2012 WL 267194, at *4 (construing plaintiff’s argument as one that
“agreements requiring the arbitration of all federal statutory claims are
rendered invalid by the passage of Dodd-Frank simply because, without having
11
anticipated the statute, the agreements implicitly require arbitration of claims
arising under it”). In rejecting the plaintiff’s argument, the court explicitly
recognized the inapplicability of Dodd-Frank when it stated: “The Court
emphasizes that this is not a case in which the dispute arises under DoddFrank.” Id. Then in passing, and without any analysis or indication that the
Anti-Retaliation Provision was even considered, the court stated that “it is clear
that any agreement requiring the arbitration of [a dispute under Dodd-Frank]
would be invalid.” Id. This judicial musing cannot suffice to warrant the
extraordinary remedy of interlocutory review.
Accordingly, neither Holmes, nor any other decision of which the Court is
aware, creates conflicting authority on the issues Plaintiff seeks to appeal. In
any event, even if the Court were to accept Plaintiff’s argument that Holmes
and Ruhe conflict, that would not be sufficient to grant Plaintiff’s motion.
Courts have repeatedly found that “[d]isagreement among courts outside the
Second Circuit does not establish a substantial ground for difference of
opinion.” Colon ex rel. Molina v. BIC USA, Inc., No. 00 Civ. 3666 (SAS), 2001
WL 88230, at *2 (S.D.N.Y. Feb. 1, 2001); see also In re Methyl Tertiary Butyl
Ether (MTBE) Prod. Liab. Litig., No. MDL 1358 (SAS), 2005 WL 39918, at *2
(S.D.N.Y. Jan. 6, 2005) (“[D]isagreement outside this Circuit … [does not]
demonstrate a substantial ground for a difference of opinion.”); In re NASDAQ
Market Makers Antitrust Litig., 938 F. Supp. 232, 253 (S.D.N.Y. 1996) (“Those
opinions [from other district courts] do not control in this Circuit and do not
themselves create ‘substantial grounds’ for a difference of opinion.”).
12
It is true that the Second Circuit has not addressed these issues, but
“the mere presence of a disputed issue that is a question of first impression,
standing alone, is insufficient to demonstrate a substantial ground for
difference of opinion.” In re Flor, 79 F.3d at 284; Peters, 2012 WL 946875, at
*14 (“The Second Circuit has cautioned, however, that the mere presence of a
disputed issue that is a question of first impression, standing alone, is
insufficient to demonstrate a substantial ground for difference of opinion.”
(internal quotation marks omitted)). Rather, the district court must “analyze
the strength of the arguments in opposition to the challenged ruling when
deciding whether the issue for appeal is truly one on which there is a
substantial ground for dispute.” In re Flor, 79 F.3d at 284 (emphasis in
original).
Although precedent on the issues is lacking, the issues themselves are
not particularly difficult. As this Court already found, congressional intent is
clear on the face of the statutes. Murray, 2014 WL 285093, at *11 (“There is
also nothing in the statutory text to indicate that Congress intended for the
Sarbanes-Oxley predispute provisions to apply to the Anti-Retaliation
Provision.”). Congress included a prohibition against predispute arbitration
agreements for claims arising under Sarbanes-Oxley, 18 U.S.C. § 1514A(e), but
did not include such a prohibition for claims arising under the Anti-Retaliation
Provision, 15 U.S.C. § 78u-6(h).
That Plaintiff brought only claims arising under the Anti-Retaliation
Provision is clear from both the Complaint and Plaintiff’s conduct to date. As
13
the Court identified in its prior opinion, Murray, 2014 WL 285093, at *9,
Plaintiff’s Complaint recited a violation of the Anti-Retaliation Provision, alleged
that the Court had jurisdiction under that provision, and sought remedies
available only under that provision. Plaintiff’s filing of a second action before
this Court, Murray v. UBS Sec., LLC, et al., No. 14 Civ. 927 (KPF), for his claim
under Sarbanes-Oxley, is yet further confirmation that Plaintiff’s Complaint in
this action arose solely under the Anti-Retaliation Provision. Moreover, the
Court’s decision is consistent with Ruhe, the only decision found by the Court
that addresses this issue. For all of these reasons, the Court’s determinations
at Sections B(2)(i) and (ii) of the January 27 Order were firmly rooted in the law
and supported by the record.
Because the issues presented are not particularly difficult (if of first
impression in this Circuit), and because Plaintiff has not pointed to a
substantial split among district court rulings on this issue in this Circuit, the
second requirement for certification is not met. See, e.g., Salim Oleochemicals,
Inc. v. M/V Shropshire, 177 F. Supp. 2d 159, 162 (S.D.N.Y. 2001) (denying
motion for interlocutory appeal because “[t]he issue presented was not difficult
and of first impression, nor have plaintiffs pointed to a substantial split in
Second Circuit district court rulings on the issue” (internal quotation marks
and citations omitted)).
14
3.
An Immediate Appeal Will Not Materially Advance the Ultimate
Termination of the Litigation
Courts place particular emphasis on the last factor — whether immediate
appeal will materially advance the ultimate termination of the litigation. See
Koehler, 101 F.3d at 865 (“The use of § 1292(b) is reserved for those cases
where an intermediate appeal may avoid protracted litigation.”). “An immediate
appeal is considered to advance the ultimate termination of the litigation if that
appeal promises to advance the time for trial or to shorten the time required for
trial.” Transp. Workers Union of Am., Local 100, 358 F. Supp. 2d at 350
(internal quotation marks omitted); Peters, 2012 WL 946875, at *13 (“Courts
have held that immediate appeal advances the ultimate termination of litigation
if the appeal promises to advance the time for trial or to shorten the time
required for trial.”).
Plaintiff argues that certifying the issues for interlocutory appeal “will
advance the ultimate termination of the litigation if the Order is reversed
because a reversal will prevent the parties from delaying the litigation by
engaging in costly and unnecessary arbitration proceedings.” (Pl. Br. 6
(emphasis added)). Plaintiff’s argument prevails only if this Court’s decision is
reversed; if the Second Circuit affirms the Court’s decision, or rather yet,
declines to hear Plaintiff’s appeal, the result will be that this action will have
been unnecessarily delayed by the interlocutory appeal. Moreover, it is safe to
assume that the appeal process will take longer than the arbitration, thereby
extending the time in which a final decision on the merits is rendered. OwnerOperator Indep. Drivers Assoc., Inc. v. Swift Transp. Co., Inc., No. CV 02-105915
PHX-PGR, 2004 WL 5376210, at *1 (D. Ariz. July 28, 2004) (“The Court also
has to consider that since the appeal process would realistically take far longer
than would the arbitration process, an interlocutory appellate ruling adverse to
the plaintiffs would only prolong the termination of the plaintiffs’ claims
against [certain defendants].”). In light of these competing outcomes, the
Court’s confidence in its prior decision, and the fact that certifying the issues
for interlocutory appeal would only delay adjudication of the merits of this
action in the arbitral forum, the Court cannot find that granting certification
would “promise” to materially advance the ultimate termination of this action
so as to establish this final requirement. Westwood Pharm., Inc., 964 F.2d at
89 (expressing disapproval of district court’s Section 1292(b) certification where
it was “not clear” to the Second Circuit that its disposition of the certified
issues would “materially advance the ultimate determination of [the] case”); In
re XO Commc’n, Inc., 2004 WL 360437, at *6 (holding that interlocutory appeal
of a bankruptcy court order compelling arbitration and staying the bankruptcy
action “would not materially advance the ultimate termination of the litigation”
because it “would only delay matters, as a resolution of the merits would only
be further delayed”); Owner-Operator Indep. Drivers Assoc., Inc., 2004 WL
5376210, at *1 (“While an interlocutory appellate ruling in the plaintiffs’ favor
potentially might eliminate the time required to obtain what might otherwise be
an unenforceable arbitration award, the Court has to consider that such a
ruling would not terminate this action; it would merely return the plaintiffs’
claims against M.S. Carriers to this Court for further litigation.”).
16
More importantly, allowing certification of the Court’s order would be
inconsistent with the “national policy favoring arbitration,” AT&T Mobility LLC
v. Concepcion, 131 S. Ct. 1740, 1749 (2011), and the Second Circuit’s distaste
for delaying “the arbitral process through appellate review,” Salim
Oleochemicals, 278 F.3d at 93. This, too, militates in favor of denying Plaintiff’s
motion. See, e.g., Maye v. Smith Barney Inc., 903 F. Supp. 570, 574 (S.D.N.Y.
1995) (denying motion for interlocutory appeal on the basis that, among other
things, “granting appeal at [that] time would frustrate the pro-arbitration policy
of the FAA and would not ‘materially advance the ultimate termination of the
litigation’ where the parties have not yet arbitrated their claims, a process
which could narrow the issues in dispute”); Ryan, Beck & Co., LLC, 275 F.
Supp. 2d at 398 (denying motion for interlocutory appeal, noting that “the
Second Circuit observed in Salim Oleochemicals v. M/V Shropshire, 278 F.3d
90, 93 (2d Cir. 2002), [that] an important policy consideration is the “proarbitration tilt” of the governing statute, the Federal Arbitration Act … [and
that] [u]nnecessary delay of the arbitral process through appellate review is
disfavored”); see also Owner-Operator Indep. Drivers Ass’n, Inc., 2004 WL
5376210, at *1 (“[M]ilitating against the requested certification is the fact that
it would frustrate the decidedly pro-arbitration tilt of the Federal Arbitration
Act, with its concomitant policy of avoiding unnecessary delays in prosecuting
arbitrations in part through the discouragement of immediate appellate review
of orders compelling arbitration.”); see generally 9 U.S.C. § 16(b).
17
With none of the Section 1292(b) requirements met, and this case being
far from an “exceptional” case that would warrant an interlocutory appeal, the
Court declines to grant certification.
CONCLUSION
For the foregoing reasons, Plaintiff’s motion is DENIED.
The Clerk of Court is directed to terminate Docket Entry 37, and keep
this case on the suspense calendar.
SO ORDERED.
Dated:
April 1, 2014
New York, New York
__________________________________
KATHERINE POLK FAILLA
United States District Judge
18
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