Appel v. Concierge Auctions, LLC

Opinion

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 HOWARD APPEL, et al., Case No. 17-cv-2263-BAS-MDD

12 Plaintiffs, ORDER GRANTING DEFENDANT’S 13 v. MOTION TO CONFIRM ARBITRATION AWARD 14 CONCIERGE AUCTIONS, LLC, et al., (ECF No. 74) 15 Defendants. 16 17

18 On August 4, 2023, following a five-year arbitration and an eighteen-day evidentiary 19 hearing, a panel of three arbitrators from the American Arbitration Association (the 20 “Panel”) issued a final arbitration award in this matter. Pending before the Court is 21 Defendant Concierge Auctions, LLC’s (“Concierge”) motion to confirm the arbitration 22 award. (ECF No. 74.) The Court previously denied Plaintiffs Howard Appel and David 23 Cohen’s and Defendant’s motions to vacate in part the arbitration award. (ECF No. 73.) 24 For the reasons herein, the Court GRANTS Defendant’s motion to confirm the arbitration 25 award. (ECF No. 74.) 26 I. Background 27 A fulsome account of the facts of this case can be found in the Court’s May 20, 2024, 28 order denying the parties’ motions to vacate in part the arbitration award. (ECF No. 73.) 1 This dispute arises out of luxury property auctions conducted by Defendant where 2 Plaintiffs participated or were the winning bidder. Plaintiffs brought suit accusing 3 Defendant of placing fictitious bids in order to drive up the auction prices. Following a 4 motion by Concierge, the Court compelled the parties to arbitration, stayed the 5 proceedings, and administratively closed the case. (ECF No. 30.) 6 The parties proceeded to engage in arbitration proceedings lasting five years that 7 culminated in an eighteen-day evidentiary hearing before the Panel. On August 4, 2023, 8 the Panel issued a fifty-page final award. While the Panel concluded Concierge submitted 9 fake bids, the Panel found for Concierge on all of Plaintiffs’ fraud claims because Plaintiffs 10 failed to demonstrate they were damaged by the fictitious bids. The Panel also found in 11 favor of Defendant on Plaintiffs’ breach of fiduciary duty claim. The Panel, however, 12 found against Defendant on all of its counterclaims and found in favor of Plaintiffs on their 13 conversion claim. The Panel awarded Plaintiffs $18,427 in damages. Finally, the Panel 14 found neither party was the prevailing party and that the parties were to bear their own 15 costs. (ECF No. 633-3 at 602.) 16 Plaintiffs and Defendant filed motions before this Court to vacate in part the 17 arbitration award. The Court denied these motions and ordered Defendant to file a motion 18 to confirm the arbitration award pursuant to the Federal Arbitration Act (“FAA”). (ECF 19 No. 73.) That motion is now before the Court. 20 II. Legal Standard 21 Section 9 of the FAA provides that “within one year after the award is made any 22 party to the arbitration may apply to the court so specified for an order confirming the 23 award.” 9 U.S.C. § 9. A district court, upon timely petition, “must” confirm an arbitration 24 award “unless the award is vacated, modified, or corrected as prescribed in sections 25 10 and 11.” Id. A court’s ultimate review of the petition is “both limited and highly 26 deferential.” Coutee v. Barington Cap. Grp., L.P., 336 F.3d 1128, 1132 (9th Cir. 27 2003) (citing Sheet Metal Workers’ Int’l Ass’n v. Madison Indus., Inc., 84 F.3d 1186, 1190 28 (9th Cir. 1996)). Confirmation of an arbitration award typically “is a summary proceeding 1 that merely makes what is already a final arbitration award a judgment of the 2 court.” Romero v. Citibank USA, Nat’l Ass’n, 551 F. Supp. 2d 1010, 1014 (E.D. Cal. 3 2008) (quoting Florasynth, Inc. v. Pickholz, 750 F.2d 171, 175–76 (2d Cir. 1984)). 4 Pursuant to this limited review, district courts generally assess the timeliness of the 5 motion to confirm the award, whether the parties present grounds to vacate the arbitration 6 award, and whether the underlying contract specifies a particular court to confirm the 7 award. See, e.g., Gellman v. Hunsinger, No. 18-CV-2641-BAS-AGS, 2021 WL 4295289, 8 at *7 (S.D. Cal. Sept. 20, 2021), aff’d sub nom. Gellman v. Hunsinger, No. 22-55728, 2023 9 WL 8166778 (9th Cir. Nov. 24, 2023); Shaw v. Norm Reeves Honda Superstore, No. SA- 10 CV-18786-JVS-DFMx, 2022 WL 2903161, at *4 (C.D. Cal. June 8, 2022). 11 III. Analysis 12 First, the Court previously found the contract underlying the arbitration to be 13 enforceable and mandating the parties “submit all controversies, disputes, claims, and 14 matters of difference” to arbitration. (ECF No. 30.) While the Court lacked discretion to 15 compel arbitration outside this District, it nevertheless was empowered to compel 16 arbitration in the Southern District of California. (Id.) Second, the Court previously denied 17 the parties’ motions to vacate in part the arbitration award. (ECF No. 73.) The parties 18 have not submitted additional arguments for vacatur. As follows, the Court need not assess 19 the propriety of the Panel’s award again. Third, Defendant timely made the instant motion 20 to confirm within one year of the Panel’s final award pursuant to the requirements of the 21 FAA. See 9 U.S.C. § 9. Fourth, Defendant has met the service requirements of the FAA 22 by submitting this motion through the electronic court filing system. 23 Plaintiffs submit an opposition to Defendant’s motion to confirm the award; 24 however, they do not object to the Court confirming the Panel’s award or present new 25 arguments for vacatur. (ECF No. 75.) Rather, they present two objections to the structure 26 and content of Defendant’s motion. First, Plaintiffs object to Defendant’s incorporation by 27 reference of their prior arguments for partial vacatur that the Court rejected. Plaintiffs 28 contend this is an implicit motion for reconsideration. The Court does not agree with that 1 ||interpretation. Defendant appears to be noting its prior objections in the event it pursues a 2 ||subsequent appeal and does not request the Court reconsider its prior order. Second, 3 || Plaintiffs object to Defendant dismissing its action in the U.S. District Court for the 4 ||Southern District of New York without prejudice. As discussed in more detail in the 5 || Court’s prior order, Defendant had filed a related motion in that court seeking to confirm 6 ||in part and vacate in part the Panel’s award. (ECF No. 73.) The Court does not find it 7 ||necessary to order Defendant to request the district court in New York to reopen that case 8 merely to dismiss it with prejudice. 9 Accordingly, the Court confirms the arbitration award. 10 Conclusion 11 Based on the foregoing, the Court GRANTS Defendant’s motion to confirm the 12 || arbitration award and CONFIRMS the arbitration award. (ECF No. 74.) 13 IT IS SO ORDERED. 14 f 15 || DATED: July 1, 2024 (pil A (Lyphaa 6 16 United States District Judge 17 18 19 20 21 22 23 24 25 26 27 28 _A.