Preliminary Proceedings - Chapter 5 - AAA Yearbook on Arbitration and the Law - 28th Edition
Originally from the AAA Yearbook on Arbitration and the Law - 28th Edition
5.01 Interim Relief by the Court
Adam Techs. Int’l S.A. de C.V. v. Sutherland Global Servs. Inc., 729 F.3d 443 (5th Cir. 2013)
1. The district court had ancillary jurisdiction to hear the post-judgment motion to appoint an arbitrator.
2. The district court did not err when it refused to appoint an arbitrator because there was no lapse in the naming of an arbitration panel.
3. The procedural questions are decided by the arbitrator, which the court cannot review before a final arbitration award.
Sutherland and Adam Technologies created a Letter of Intent and a Master Services Agreement, which contained different forum-selection and choice-of-law clauses from each other. The district court first determined that the Master Services Agreement superseded the expired Letter of Intent and dismissed the claims because Adam Technologies’ claims were based on the Letter of Intent. A few months later, the district court vacated the original order and held that the determination of which contract controlled was for the arbitrator, but the new order failed to clarify if the claims were still dismissed. While the motion was still pending, Adam Technologies filed a motion to appoint an arbitrator and requested the removal of two of the appointed arbitrators.
First, the court had ancillary jurisdiction to hear the motion to appoint an arbitrator. The district court did not err in refusing to appoint an arbitrator because there was no breakdown requiring the court’s intervention. Adam Technologies failed to comply with procedural rules. No Section 5 lapse occurred because there was an arbitration panel that had already set a final hearing date.
Finally, the district court did not err when it denied the motion to appoint the arbitrator because the arbitrators decide procedural questions and the panel has yet to decide a final arbitration award.
Justice Garza dissented because he disagreed that there was ancillary jurisdiction to hear the post-judgment motion to appoint an arbitrator.