Gaspar Salas v. GE Oil & Gas

857 F.3d 278, 2017 WL 2039890
CourtCourt of Appeals for the Fifth Circuit
DecidedMay 12, 2017
Docket16-20379
StatusPublished
Cited by4 cases

This text of 857 F.3d 278 (Gaspar Salas v. GE Oil & Gas) is published on Counsel Stack Legal Research, covering Court of Appeals for the Fifth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Gaspar Salas v. GE Oil & Gas, 857 F.3d 278, 2017 WL 2039890 (5th Cir. 2017).

Opinion

EDWARD C. PRADO, Circuit Judge:

Plaintiff-Appellee Gaspar Salas brought claims against Defendant-Appellant GE Oil & Gas (“GE”) for discrimination and retaliation. The district court granted GE’s motion to compel arbitration and dismissed the case. However, the court later reopened the case and withdrew its prior order compelling arbitration. Because the district court lacked jurisdiction to do so, we VACATE and REMAND for further proceedings consistent with this decision.

I. BACKGROUND

Salas is a former employee of GE. When Salas accepted employment at GE’s predecessor, Dresser, Inc., he agreed to arbitrate all disputes between the two parties. After GE acquired Dresser, Inc., GE introduced its own dispute resolution program called Solutions. GE advised Salas that if he continued to work at the company after November 1, 2013, he would “agree to participate in and abide by” this arbitration program. Salas did continue to work at GE past this date. In June 2014, Salas brought suit against GE in the district court claiming discrimination and retaliation in violation of Title VIL GE then moved to compel arbitration. The district court granted this motion in December 2014 and dismissed Salas’s claims without prejudice.

The parties did not move forward with arbitration. Each side blames the other for the delay. In February 2016, Salas filed a motion in the district court to compel arbitration; GE opposed this motion as redundant. After a telephonic conference on this motion, the district court issued an order on March 30, 2016, reopening the case and withdrawing its earlier order compelling arbitration. The district court noted in this order that the parties had “failed” to arbitrate. After the court denied GE’s motion for reconsideration, GE timely appealed.

II. DISCUSSION

The parties contest both whether the district court had subject matter jurisdiction to issue its March 30, 2016 order and *280 whether we have appellate jurisdiction over that order. We address appellate jurisdiction first.

A. Appellate Jurisdiction

GE contends that this Court has appellate jurisdiction under the Federal Arbitration Act (“FAA”), which permits an appeal from an order “denying an application ... to compel arbitration.” 9 U.S.C. § 16(a)(1)(C). Salas argues that the district court’s order dated March 30, 2016, was not an order denying a motion to compel arbitration, and that in any event GE appealed the order denying its motion for reconsideration.

The district court’s order dated March 30, 2016, followed a telephonic conference on Salas’s motion to compel arbitration. Although the order did nqt explicitly mention Salas’s motion, the order withdrew the court’s prior order granting GE’s motion to compel arbitration and reopened the case. In essence, then, the court’s March 30, 2016 order did deny an application to compel arbitration. Compare Moss v. First Premier Bank, 835 F.3d 260, 264 (2d Cir. 2016) (finding appellate jurisdiction over an order that “lifted a prior stay under Section 3 [of the FAA] and vacated a prior order compelling arbitration”), and Koveleskie v. SBC Capital Mkts., Inc., 167 F.3d 361, 363 (7th Cir. 1999) (finding appellate jurisdiction over “a minute order”—in which “the district court refused to compel arbitration”—because “there [was] no doubt from the record that the district court denied the defendant’s motion [to compel arbitration] and clearly meant to foreclose arbitration”), with Van Dusen v. Swift Transp. Co., 830 F.3d 893, 897 (9th Cir. 2016) (finding no appellate jurisdiction over “a case management order designed to lead to a decision on a motion to compel arbitration”). Additionally, GE’s motion for reconsideration tolled its time to appeal. Fed. R. App. P. 4. This Court therefore has appellate jurisdiction under 9 U.S.C. § 16(a)(1)(C).

B. Subject Matter Jurisdiction

GE principally argues that the district court lacked subject matter jurisdiction to reopen the case. Because the district court fully dismissed this case in December 2014, GE contends, the court could no longer exercise jurisdiction other than to enforce an arbitration award. In response, Salas argues that GE has waived its right to arbitration.

“We exercise plenary, de novo review of a district court’s assumption of subject matter jurisdiction.” Adam Techs. Int’l S.A. de C.V. v. Sutherland Glob. Servs., Inc., 729 F.3d 443, 447 (5th Cir. 2013) (quoting Local 1351 Int’l Longshore-mens Ass’n v. Sea-Land Serv. Inc., 214 F.3d 566, 569 (5th Cir. 2000)). This Court has held that a district court may retain ancillary jurisdiction (beyond merely enforcing the arbitration award) even after compelling arbitration and dismissing a case. Id. at 449. Thus, the fact that the district court fully dismissed this case is not necessarily fatal to the court’s exercise of jurisdiction.

But the FAA limits “jurisdiction by the courts to intervene into the arbitral process prior to issuance of an award.” Gulf Guar. Life Ins. v. Conn. Gen. Life Ins., 304 F.3d 476, 486 (5th Cir. 2002). Even if some default occurs in the arbitral process, courts may not intervene “beyond the determination as to whether an agreement to arbitrate exists and enforcement of that agreement.” Id. at 487; 9 U.S-.C. § 4 (“If the making of the arbitration agreement or the failure, neglect, or refusal to perform the same be in issue, the court shall proceed summarily to the trial *281 thereof.... If the jury find that an agreement for arbitration was made in writing and that there is a default in proceeding thereunder, the court shall make an order summarily directing the parties to proceed with the arbitration in accordance with the terms thereof.”). For example, in Gulf Guaranty, we found that a district court could not entertain torts claims alleging “failure or breach of the agreed upon arbi-tral process” prior to issuance of an award; such claims do “not appear to fall within the ambit of a court’s authority to enforce a valid arbitration agreement under the FAA.” 304 F.3d at 486, 488. Nor does the FAA authorize a court to hear pre-award “disputes over the qualifications of an arbitrator to serve,” unless the dispute raises concerns “that the very validity of the agreement [is] at issue.”

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Bluebook (online)
857 F.3d 278, 2017 WL 2039890, Counsel Stack Legal Research, https://law.counselstack.com/opinion/gaspar-salas-v-ge-oil-gas-ca5-2017.