Weingarten Realty Investors v. Miller Sheridan LLC
Filing
29
OPINION on Dismissal. (Signed by Judge Lynn N. Hughes) Parties notified. (ghassan, )
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Weingarten Realty Investors,
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Plaintiff,
Civil Action H.12-143 5
versus
Miller Sheridan UC,
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Defendant .
Opinion on Dismissal
I.
Introduction.
One member of ajoint venture has demanded to arbitrate a dispute with the other. The
other member says that the arbitration should be enjoined or stayed because the claims are
unripe, waived, and derivative. T h e parties must arbitrate.
2.
Background.
In 2004, Weingarten Realty Investors and Miller Sheridan LLC formed Weingarten
Miller Sheridan, UC, to build a shopping mall. O n December I 5 , 2006, Weingarten lent
s7
j
million dollars to the venture. The venture signed a promissory note, and the loan was secured
by the land for the mall. At the same time, Miller Sheridan and Stewart Miller separately
guaranteed the loan. T h e two agreed to be responsible jointly for one-half of the amount
outstanding if the venture did not pay. T h e debt was to be paid by December
I j, 2010.
O n June 15, 2011, when the debt was due, the venture did not pay. T h e next day,
Weingarten asked Miller to honor his guarantee for one-half of the loan.
In February of 2012, Miller Sheridan moved to intervene in Weingarten's case against
Miller. After a hearing on intevention, it withdrew its motion. Three weeks later, it sent
Weingarten a demand for arbitration.
3.
Arbitrabiliy.
Weingarten says that arbitration should be barred or stayed because Miller Sheridan
waived the right to arbitrate when it tried to intervene, the dispute about indemnification is not
ripe, and the claim for breach of contract and fiduciary duty is a claim that belongs to the joint
venture. Miller Sheridan says that questions about the arbitrability of the disputes should be
handled by the arbitrator.
Weingarten and Miller Sheridan agreed to arbitrate under the rules of the American
Arbitration Association. Rule 7 of the commercial arbitration rules says that the arbitrator has
the power to reviewjurisdiction and arbitrability. Nothing in the arbitration clause in the jointventure agreement conflicts with that rule.
T h e claims may have been waived, may be derivative, and may be green; those questions
are for the arbitrator.
4.
Conclusion.
Weingarten Realty Investors and Miller Sheridan LLC must arbitrate the claims for
indemnification and breach of contract and fiduciary duty, and objections to the arbitration
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must be raised with the arbitration panel. T h e parties may not arbitrate the guarantee by
Stewart A. Miller.
Signed on October
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, ror 2,at Houston. Texas.
/
Lynn N ~ u g h e d
United States District Judge
u
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