Nu Skin Enterprises v. Raab

Opinion

Appellate Case: 22-4068 Document: 010111018539 Date Filed: 03/19/2024 Page: 1 FILED United States Court of Appeals UNITED STATES COURT OF APPEALS Tenth Circuit

FOR THE TENTH CIRCUIT March 19, 2024 _________________________________ Christopher M. Wolpert Clerk of Court NU SKIN ENTERPRISES, INC., a Delaware corporation; PHARMANEX, LLC, a Delaware limited liability company,

Petitioners - Appellants,

v. No. 22-4068 (D.C. No. 2:21-CV-00709-RJS) EARNEST L. RAAB, D.C., d/b/a (D. Utah) Success to Significance LLC, a Washington LLC; MICHAEL ULRICK; LARRY C. WIEBER and ROSE WIEBER, d/b/a Test for Nutrition of Washington, LLC, a Washington LLC; MAX ROBBINS; DEBRA ROBBINS; TONI RAGSDALE, d/b/a Ragsdale and Company LLC, an Oklahoma LLC; WAYNE MATECKI, LAC and AMY L. MATECKI, M.D., d/b/a Dr. Amy's Integrative Medicine, Inc., a California corporation,

Respondents - Appellees.

_________________________________

ORDER AND JUDGMENT* _________________________________

Before HARTZ, BALDOCK, and MORITZ, Circuit Judges. _________________________________

* This order and judgment is not binding precedent, except under the doctrines of law of the case, res judicata, and collateral estoppel. It may be cited, however, for its persuasive value consistent with Fed. R. App. P. 32.1 and 10th Cir. R. 32.1. Appellate Case: 22-4068 Document: 010111018539 Date Filed: 03/19/2024 Page: 2

Appellants Nu Skin Enterprises, Inc. and Pharmanex, LLC petitioned the United

States District Court for the District of Utah to enjoin Appellees Earnest Raab, et al, from

pursuing litigation against them in Washington state court and ordering them to submit

their dispute to arbitration under the Federal Arbitration Act. Appellants relied on

identical arbitration clauses in contracts (the Contracts) it had entered into with

Appellees. In June 2022 the district court denied the motion to compel arbitration and

dismissed the petition, holding that it was precluded by the ruling by the Superior Court

of the State of Washington that “the underlying Complaint is not a ‘Dispute’ within the

meaning of the [arbitration provision in the] Contract[s].” Nu Skin Enter., Inc. v. Raab,

No. 2:21-cv-00709-RJS-CMR, 2022 WL 2118223 at *11 (D. Utah, June 13, 2022); see

Raab v. Nu Skin Enter., Inc., No. 21-2-03272-32, 2022 WL 21816495 (Wash. Super.

Mar. 8, 2022).

Appellants appealed that decision to this court. Shortly after that notice of appeal

was filed, the Washington Court of Appeals granted Appellants’ motion to consider an

interlocutory appeal from the decision of the state Superior Court, and the parties to this

appeal agreed to stay this appeal pending a decision by the Washington Court of Appeals.

In October 2023 the Washington Court of Appeals reversed the decision of the Superior

Court, holding that the claims in the litigation were disputes subject to the arbitration

agreement and remanding to the Superior Court for further proceedings, including

determination of whether the arbitration clause is unconscionable. See Raab v. Nu Skin

Enter., 536 P.3d 695 (Wash. Ct. App. 2023).

Page 2 Appellate Case: 22-4068 Document: 010111018539 Date Filed: 03/19/2024 Page: 3

As stated by all parties in their briefs to this court, the Superior Court decision no

longer has preclusive effect. Because preclusion was the basis of the district court’s

decision in this case, we must therefore reverse that decision. We express no view on any

other issue in this case, including the possible preclusive effect of any other proceedings

or decisions in the Washington courts.

Exercising jurisdiction under 28 U.S.C. § 1291, we REVERSE and REMAND

for further proceedings.

Entered for the Court

Harris L Hartz Circuit Judge

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