Sterling and Wilson Solar Solutions, Inc. v. Fidelity and Deposit Company of Maryland

• Court: Court of Appeals for the Ninth Circuit
• Decided: August 26, 2024
• Docket: 23-35558
• Status: Unpublished

Opinion

NOT FOR PUBLICATION FILED UNITED STATES COURT OF APPEALS AUG 26 2024 MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS FOR THE NINTH CIRCUIT

STERLING AND WILSON SOLAR No. 23-35558 SOLUTIONS, INC., a Delaware corporation, D.C. No. 1:22-cv-03076-SAB Plaintiff-Appellee,

v. MEMORANDUM*

FIDELITY AND DEPOSIT COMPANY OF MARYLAND, an Illinois insurance company; ZURICH AMERICAN INSURANCE COMPANY, an Illinois insurance company,

Defendants-Appellees,

v.

CONTI LLC, Proposed Intervenor,

Movant-Appellant.

Appeal from the United States District Court for the Eastern District of Washington Stanley A. Bastian, Chief District Judge, Presiding

Argued and Submitted August 19, 2024 Seattle, Washington

Before: HAWKINS, McKEOWN, and DE ALBA, Circuit Judges.

* This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3. Proposed Intervenor-Appellant Conti LLC (“Conti”) appeals the district

court’s denial of its motion to intervene and stay in Plaintiff-Appellee Sterling and

Wilson Solar Solutions, Inc.’s (“Sterling”) suit against Fidelity and Deposit

Company of Maryland and Zurich American Insurance Company, the sureties that

secured Conti’s performance of a construction contract with Sterling. Appellate

jurisdiction over the district court’s denial of Conti’s motion to stay must be found

under Section 16 of the FAA, if at all; otherwise, the denial of a discretionary stay

is not an appealable order.1 See 9 U.S.C. § 16(a)(1)(A); Blair v. Rent-A-Center, Inc.,

928 F.3d 819, 832 (9th Cir. 2019). Because Conti’s argument for appellate

jurisdiction is foreclosed by Western Security Bank v. Schneider Ltd. Partnership,

816 F.3d 587 (9th Cir. 2016), we dismiss for lack of jurisdiction.

Where “the movant seeks only the relief provided by the FAA, rather than any

other judicially-provided remedy,” appellate jurisdiction is available under Section

16 of the FAA, but where “the movant in the district court requests a judicial remedy

that is inconsistent with the position that the issues . . . may be decided only by the

arbitrator, the movant is no longer proceeding exclusively under the FAA and has

forfeited their right to interlocutory review under § 16(a).” Id. at 590 (quoting

Conrad v. Phone Directories Co., 585 F.3d 1376, 1385–86 (10th Cir. 2009)). In

1 As Conti clarified at oral argument, it does not seek appellate jurisdiction over the district court’s denial of its motion to intervene in isolation from its motion to stay, because it only moved to intervene to seek a stay.

2 Schneider, the movant did not seek to arbitrate any claims in the federal court action

and instead was only “intent on resolving the common issues” between the

arbitration and the litigation “first in the arbitration.” Id. (internal quotation marks

omitted). Accordingly, we held that the stay motion “was not for relief under the

FAA,” and “no § 16(a) appellate jurisdiction exists over the denial of that motion.”

Id.

So too here. Conti did not seek to compel Sterling and the sureties to arbitrate

any claims they are currently litigating in the district court. Conti concedes, in fact,

that pursuant to the bond and Washington law, Sterling and the sureties are not

required to arbitrate those claims. As in Schneider, Conti is not seeking relief under

the FAA but rather a discretionary stay while it continues its ongoing arbitration

against Sterling. “In so doing, [Conti] made clear that [it] ultimately s[ought] a

judicial remedy from the district court after completion of the separate arbitration,

rather than an exclusive remedy . . . through arbitration.” Id. As both parties

acknowledged at argument, the arbitration is scheduled to take place before trial in

the district court—effectively the relief Conti sought through its stay motion in the

first place. In dismissing this appeal, we expect the parties to adhere to this ordering

of proceedings.

APPEAL DISMISSED FOR LACK OF JURISDICTION.