[00:00:00] Speaker 00:
The United States Court of Appeals for the Ninth Circuit is now in session.

[00:00:09] Speaker 01:
Good morning, perhaps good afternoon for our counsel and Judge Fischer, who is joining us from the Third Circuit.

[00:00:16] Speaker 01:
And Judge Bybee and I want to thank Judge Fischer for helping us out today.

[00:00:21] Speaker 01:
Today we're hearing two cases.

[00:00:23] Speaker 01:
The first case we will hear is Sergio Gonzalez versus Coverall, North America.

[00:00:30] Speaker 04:
Good morning.

[00:00:32] Speaker 04:
Good morning, Your Honors.

[00:00:33] Speaker 04:
Can you hear me?

[00:00:33] Speaker 04:
OK.

[00:00:36] Speaker 04:
I'm Shannon Lesverdin.

[00:00:37] Speaker 04:
I represent the plaintiffs in both of these cases.

[00:00:41] Speaker 04:
Just as a procedural matter, I wanted to confirm, does the court want to hear the Gonzalez case and then the Rivas case?

[00:00:48] Speaker 04:
Or should we combine the arguments because of the similarities?

[00:00:52] Speaker 04:
Do you want us to go back and forth

[00:00:55] Speaker 01:
I think we'll hear the Gonzalez case, and after we're done, we will hear the Rebus case.

[00:01:01] Speaker 04:
Okay.

[00:01:01] Speaker 04:
All right.

[00:01:02] Speaker 04:
Thank you.

[00:01:02] Speaker 04:
May I reserve five minutes in for rebuttal on the Gonzalez case?

[00:01:06] Speaker 01:
Sure.

[00:01:06] Speaker 01:
And just watch the clock.

[00:01:07] Speaker 01:
Thank you.

[00:01:08] Speaker 04:
Okay.

[00:01:08] Speaker 04:
All right.

[00:01:09] Speaker 01:
Thank you.

[00:01:10] Speaker 04:
So, Your Honors, as I just started to explain, we have two very similar related cases that you're hearing together.

[00:01:17] Speaker 04:
With respect to the Gonzalez case, this case has entered into a

[00:01:26] Speaker 04:
might I say Kafkaesque procedural situation where years after being filed, it has never been able to see the light of day for a ruling on any kind of merits or even on the enforceability of coveralls arbitration agreement, which has been challenged for a long time.

[00:01:45] Speaker 04:
The specific issue that is before the court today in Gonzalez, however, is the question about whether the district court should have

[00:01:55] Speaker 04:
granted our motion under Rule 60 to reopen the case after plaintiff voluntarily dismissed the case in reliance on prior Ninth Circuit precedent, including the Bloomingdale's case, to obtain appellate jurisdiction of the order compelling arbitration.

[00:02:17] Speaker 04:
When this court went up on appeal, when this case went up on appeal the first time around, we believed that this circuit's precedent allowed for such a move in order to appeal the order compelling arbitration.

[00:02:35] Speaker 04:
However, the court held that the plaintiff needed to have actually requested for certification of the issue under Section 1292, and the case was remanded.

[00:02:50] Speaker 04:
So we then went back to the district court in order to request that 1292 review, and the court said, sorry, too late.

[00:03:00] Speaker 04:
You dismissed the case, and I won't grant your Rule 60B motion.

[00:03:09] Speaker 02:
Yes.

[00:03:10] Speaker 02:
One other question, a basic question that I have for you on this 60B motion.

[00:03:19] Speaker 02:
It clearly says that the court may relieve a party of its legal rep or its legal representative from a final judgment.

[00:03:31] Speaker 02:
Those words are used in Rule 60B.

[00:03:37] Speaker 02:
In light of Gonzales 1, which Gonzales 1 said that you did not have a final judgment because there was a dismissal without prejudice, how do you even have the basis to file a 60-B motion?

[00:03:56] Speaker 04:
Well, so Your Honor, we're in this cottonous paradox, which this court noted in the Henson case, that the

[00:04:07] Speaker 04:
dismissal was not considered a final judgment, as you've just said, yet somehow the district court treated it as final because we were never able to get back to the district court after proceeding with an appeal only to be told that we had to go back to the district court.

[00:04:27] Speaker 04:
So in the Henson case on page 454, this court says, it is somewhat paradoxical that although the court in Microsoft ruled that a conditional voluntary dismissal is not a final judgment, the district court effectively treated the voluntary dismissal as a final, irrevocable judgment.

[00:04:49] Speaker 04:
So we're caught in this paradox that even though apparently the argument is that there was no final

[00:04:56] Speaker 04:
judgment in the district court case, we weren't able to get back into the district court.

[00:05:01] Speaker 04:
So this case is really caught in no man's land.

[00:05:05] Speaker 04:
The last time this case was here at this court, it was remanded for the district court to consider the effect of the Henson case.

[00:05:14] Speaker 04:
Um, and this court last time didn't have any question about whether it had jurisdiction to issue a ruling in this case.

[00:05:23] Speaker 04:
It did.

[00:05:24] Speaker 04:
And it issued the decision remanded.

[00:05:26] Speaker 02:
Let's assume you're saying it did.

[00:05:32] Speaker 02:
But does that mean anything here if it really didn't?

[00:05:38] Speaker 04:
Well, we're just trying to figure out how to get a ruling.

[00:05:42] Speaker 04:
We've been set around in this procedural paradox for years just trying to get a ruling or trying to get an appeal on the order-compelling arbitration.

[00:05:52] Speaker 04:
And we haven't been able to get a ruling anywhere, either from the district court or the appellate court.

[00:05:57] Speaker 04:
There's got to be someplace that the plaintiff can appeal.

[00:06:01] Speaker 04:
The argument is being made that there was no final judgment in the district court.

[00:06:05] Speaker 04:
Okay, so we should be able to proceed in the district court.

[00:06:07] Speaker 04:
But the district court said no, because it wouldn't grant our Rule 60 motion to allow us to proceed in the district court.

[00:06:14] Speaker 04:
So basically, the plaintiff is nowhere.

[00:06:16] Speaker 00:
Do you have any other mechanisms available to you to seek review of the order?

[00:06:22] Speaker 00:
Let's consider two.

[00:06:25] Speaker 00:
One would be to go ahead and arbitrate and then challenge any decision that came out there from the arbitrator.

[00:06:33] Speaker 00:
And the second would be to have dismissed with prejudice.

[00:06:36] Speaker 00:
Either of those give you any opportunity to challenge?

[00:06:40] Speaker 04:
Well, first of all, Mr. Gonzalez did try to arbitrate and he was not able to get his foot in the door for arbitration because he was told he would have to pay $4,000 simply to get an arbitrator to decide whether he would have to pay for arbitration.

[00:06:56] Speaker 00:
There were other ways of getting around the $4,000, am I correct?

[00:07:00] Speaker 04:
No, I'm not aware of any way to get around the $4,000.

[00:07:03] Speaker 04:
That's what he was told he would have to pay.

[00:07:05] Speaker 00:
There's no hardship waiver available?

[00:07:08] Speaker 04:
There is no hardship waiver available to get around the $4,000 that I'm aware of.

[00:07:16] Speaker 04:
Coverall belatedly offered to, I believe, advance

[00:07:22] Speaker 04:
the money if the arbitrator determined that Mr. Gonzalez could not afford arbitration, but that didn't allow him to even get before an arbitrator to make that argument because he was faced with his bill for $4,000.

[00:07:37] Speaker 04:
So that was also something that he wanted to raise with the district court, but has never been able to raise because he's never been able to get back to the district court to even present any of these arguments.

[00:07:49] Speaker 04:
With respect to the dismissal with prejudice, I'm not really quite sure where we are.

[00:07:56] Speaker 04:
We've been back and forth for years over this.

[00:07:59] Speaker 04:
Again, the district court seems to believe that this case is over in the district court.

[00:08:07] Speaker 04:
And so we haven't been able to pursue the case in the district court.

[00:08:13] Speaker 00:
But you dismissed without prejudice.

[00:08:16] Speaker 00:
If you had gone back to the district court and said, we've decided to dismiss with prejudice, would you have had an available appeal to this court?

[00:08:25] Speaker 04:
Well, no, because the problem is the first time we were at this court, we were told that you can't dismiss voluntarily to create jurisdiction based on what the Supreme Court held in the Baker versus Microsoft case.

[00:08:41] Speaker 04:
So we needed to go back to the district court and ask for 1292 certification.

[00:08:47] Speaker 04:
We were trying to do that, and the district court wouldn't even let us get in the door by denying our motion.

[00:08:53] Speaker 04:
for Rule 60B relief.

[00:08:57] Speaker 02:
Could you file a new complaint?

[00:09:02] Speaker 04:
We file a new complaint.

[00:09:03] Speaker 04:
Well, I mean, this initial complaint was filed about eight years ago.

[00:09:07] Speaker 04:
So if we filed a brand new complaint, most of what Mr. Gonzalez sought would not be timely anymore.

[00:09:18] Speaker 04:
unless there was tolling, in which case, which is not certain, in which case it's not clear why we couldn't just continue with the case that was filed eight years ago.

[00:09:30] Speaker 04:
So if

[00:09:33] Speaker 04:
We'd urge the court to look at the Henson decision.

[00:09:36] Speaker 04:
This case is really on all fours with the Henson decision, where the court held that there are various factors that should be looked at, but basically the equities should be addressed in determining whether or not a party can get back

[00:09:51] Speaker 04:
to court under Rule 60B after dismissing a case based on the assumption from prior case law that voluntary dismissal was an avenue to obtain an appeal.

[00:10:07] Speaker 04:
We relied on prior Ninth Circuit case law, including the Bloomingdale's case,

[00:10:14] Speaker 04:
this court did not, in the decision, in the original decision, didn't cite the Bloomingdale's case.

[00:10:23] Speaker 04:
Instead, it cited earlier case law that said that you cannot voluntarily dismiss a case in order to obtain an appeal of an order compelling arbitration.

[00:10:38] Speaker 01:
Sorry to interrupt.

[00:10:40] Speaker 01:
For us to consider Henson, we have to agree that Microsoft changed the legal landscape in this case?

[00:10:49] Speaker 04:
Right.

[00:10:49] Speaker 04:
Well, I mean, the last time, the second time this case was at this court, the court thought that Henson seemed applicable.

[00:10:56] Speaker 04:
And that's why it remanded to the district court to apply Henson.

[00:11:01] Speaker 04:
And Henson is really on all fours.

[00:11:04] Speaker 04:
It is very strange that when this court before held that

[00:11:15] Speaker 04:
It was very strange that this court didn't cite the Microsoft case when the entire oral argument was all about Microsoft and Coverall's entire argument was about Microsoft.

[00:11:28] Speaker 04:
That was what we talked about during the appeal was Microsoft.

[00:11:31] Speaker 04:
And then when this court issued its order,

[00:11:33] Speaker 04:
It talked about earlier cases without mentioning Microsoft very curiously, but it seemed very clear from the argument that that was the reason for the court's decision.

[00:11:44] Speaker 04:
And again, we had cited Bluingdale's, which was a more recent case than the cases cited by this court in that order.

[00:11:53] Speaker 04:
to say that a voluntary dismissal was a proper avenue to get an appeal of an order compelling arbitration.

[00:12:02] Speaker 04:
So the only thing that changed between the Bloomingdale's decision and this court's decision was the Microsoft case.

[00:12:10] Speaker 04:
And again, I'm not sure why this court would have remanded for consideration of Microsoft, sorry, remanded for consideration of Henson if Henson's not actually applicable.

[00:12:19] Speaker 04:
We spent the last more than two years

[00:12:23] Speaker 04:
waiting for the district court now to do the Henson analysis.

[00:12:27] Speaker 04:
And I believe that the district court just missed the point of Henson, which said that essentially you have to look at the equities, look at whether it would be unfair to penalize a party that had relied on Ninth Circuit case law only to be caught by an intervening change of law

[00:12:51] Speaker 04:
that doesn't allow that Avenue for relief.

[00:12:55] Speaker 04:
Um, this is a very calm.

[00:12:57] Speaker 04:
Unfortunately, this is very complicated procedural situation for this case.

[00:13:02] Speaker 04:
But the weight of the issue is his plaintiff has never been able to get to the merits.

[00:13:06] Speaker 04:
This case after eight years has never been able to even get a ruling or

[00:13:11] Speaker 04:
an ability to challenge the order compelling arbitration.

[00:13:15] Speaker 04:
He wasn't able to get his foot in the door to even arbitrate the case.

[00:13:18] Speaker 04:
This case has just been in no man's land for years, and it would be an enormous miscarriage of justice if this case could never even be heard on appeal or back in the district court.

[00:13:31] Speaker 04:
If the decision really wasn't final, Mr. Gonzalez should be able to get back to the district court to make his argument.

[00:13:38] Speaker 01:
Thank you.

[00:13:39] Speaker 04:
Thank you.

[00:13:44] Speaker 03:
Good morning, may it please the court.

[00:13:46] Speaker 03:
Your honors, I do want to address some of the points that counsel made about Henson and why it's inapplicable here.

[00:13:54] Speaker 03:
But I'd really like to begin by addressing this court's jurisdiction to hear this appeal, because with respect, we would submit it has none.

[00:14:02] Speaker 03:
In fact, we would submit that by virtue of this court's ruling in the first appeal, way back in 2019, this court has already determined that it lacks jurisdiction over this appeal.

[00:14:13] Speaker 03:
That first ruling should have been the end of the appeals in this matter, at least until the district court either ruled on a motion to confirm or vacate an arbitration award or entered a judgment on the merits in the event an arbitrator concluded that all or some of these claims were not arbitrable.

[00:14:31] Speaker 03:
Yet over the course of nearly eight years, we've made three trips to this court, all based on the plaintiff's seemingly endless efforts

[00:14:39] Speaker 03:
to convince this court to order the district court to undo the very ruling he asked the district court to make, which was that it dismiss his claims without prejudice so that he could take an interlocutory appeal of a ruling, one granting a motion to compel arbitration and a limited ruling at that only on arbitrability issues that Congress made clear is not reviewable on an interlocutory basis.

[00:15:03] Speaker 03:
There is not one case from this circuit or any other circuit that supports that jurisdictional gambit.

[00:15:10] Speaker 00:
What mechanisms are available to a party that believes that it should not have to arbitrate its claims?

[00:15:18] Speaker 00:
How do they get that issue before a court?

[00:15:25] Speaker 03:
Well, in one of two ways.

[00:15:26] Speaker 03:
In this case, Your Honor, the parties delegated, and plaintiff hasn't challenged that on appeal, the parties delegated all questions regarding the validity or enforceability of the arbitration agreement to an arbitration

[00:15:38] Speaker 03:
So that is a question for the arbitrator to address in the first instance.

[00:15:41] Speaker 03:
If a party believes that the arbitrator got that wrong, that party always has the right under section 10 of the Federal Arbitration Act at the end of the arbitral proceedings to challenge that determination.

[00:15:52] Speaker 03:
That's how the process should work here.

[00:15:55] Speaker 03:
But it didn't work here because plaintiff tried to create appellate jurisdiction

[00:15:59] Speaker 00:
where it simply does not- Is that the only way that the question of arbitration can be reached?

[00:16:05] Speaker 00:
Is there another avenue?

[00:16:06] Speaker 03:
The other avenue, Your Honor, would have been for plaintiffs to ask the district court to certify its ruling for interlocutory review under 28 U.S.C.

[00:16:15] Speaker 03:
1292B, but that never happened.

[00:16:18] Speaker 03:
Instead, the plaintiff asked the court to dismiss his claims

[00:16:22] Speaker 03:
without prejudice, and that's a key factor, without prejudice, so that he could take the appeal at the FIA.

[00:16:29] Speaker 03:
Mr. Leon, did they really ask that?

[00:16:31] Speaker 03:
Yes, Your Honor, and I would direct, Your Honor, to page 50 of the supplemental excerpts of record.

[00:16:38] Speaker 03:
That is the proposed order that the plaintiffs submitted to the District Court in connection with their request that the District Court dismiss their case, and it specifically asks, Your Honor,

[00:16:52] Speaker 03:
that the lawsuit be dismissed, quote unquote, without prejudice.

[00:16:58] Speaker 03:
Now, the order that the plaintiff is appealing from now, which asks this court to review the district court's order denying his second Rule 60B motion, is no more final than the order that was the subject of the first appeal, or for that matter, the second appeal.

[00:17:13] Speaker 03:
And Judge Fischer, your point on Rule 60B is right on point.

[00:17:17] Speaker 03:
That motion should never have been addressed even by the district court because, as it noted correctly the second time around, such a motion is not properly brought as to a non-final order.

[00:17:29] Speaker 03:
Plain terms of the rule say that these motions may be brought as to final orders, and it's the law of this case based upon the ruling in the first appeal that the district court's order granting the plaintiff's request to voluntarily dismiss his suit without prejudice was not final.

[00:17:43] Speaker 01:
So how should we treat the Gonzalez II, the second appeal?

[00:17:47] Speaker 01:
I mean, it seems to at least implicitly have exercised jurisdiction.

[00:17:51] Speaker 01:
So do we just ignore it, say it didn't explicitly address it?

[00:17:57] Speaker 01:
What do we do with that, Gonzalez II?

[00:18:00] Speaker 03:
I think it falls into the category, Your Honor, of a principle that decisions are only authority for the principles that they address.

[00:18:10] Speaker 03:
And the panel in the second appeal

[00:18:13] Speaker 03:
At least the majority in the second appeal did not address the court's jurisdiction to act.

[00:18:18] Speaker 03:
Judge Collins did in his dissent, noting that the first appeal had already concluded that the matter was not based on a final order and therefore not appealed.

[00:18:29] Speaker 03:
I did want to address, Your Honor, one other jurisdictional issue before I moved off of this.

[00:18:34] Speaker 03:
And it's an argument that the plaintiff raises in their reply brief.

[00:18:39] Speaker 03:
The plaintiff now seems to claim for the first time

[00:18:43] Speaker 03:
that this court has jurisdiction over the district court's ruling because appellate courts have jurisdiction over decisions that resolve important questions that are separate from the merits and are effectively unreviewable on appeal from a final judgment.

[00:18:59] Speaker 03:
Your honor is no doubt recognized that as the collateral order doctrine.

[00:19:04] Speaker 03:
That doctrine can't apply here because it can only be invoked when the entire category of claims at issue requires immediate review.

[00:19:13] Speaker 03:
That's from the Mohawk case that the plaintiffs cite.

[00:19:16] Speaker 03:
That standard obviously can't be met here because Congress made that decision when it enacted the FAA.

[00:19:21] Speaker 03:
It expressly stated in section 16 that orders in favor of arbitration, which is the category of orders involved here, could not be appealed on an interlocutory basis.

[00:19:31] Speaker 03:
So plaintiffs are effectively asking this court to use the collateral order doctrine to create an appellate right that Congress said does not exist, which is why this court specifically rejected that notion

[00:19:42] Speaker 03:
that the collateral water adoption could be used to appeal a ruling in favor of arbitration in Johnson versus consumerinfo.com.

[00:19:50] Speaker 03:
That's 745 F3 1019.

[00:19:52] Speaker 03:
Now, unless the court has additional questions on the jurisdiction issue, I did want to move on to Henson because no matter how many times plaintiff says otherwise, Henson simply doesn't apply here.

[00:20:11] Speaker 03:
I do want to clarify something about what the second panel did in this matter.

[00:20:17] Speaker 03:
Plaintiff claims and just stated during argument that this court remanded the matter to the district court with instructions that apply Henson.

[00:20:25] Speaker 03:
That's not entirely accurate.

[00:20:27] Speaker 03:
The decision of the majority on the second appeal actually was that the matter was remanded to the district court to determine not just how the Henson factors might apply, but whether they applied at all.

[00:20:39] Speaker 03:
And the district court's conclusion that they did not was correct for one simple reason.

[00:20:43] Speaker 03:
Henson just does not apply on these facts.

[00:20:46] Speaker 03:
The rule that Henson announced relied on the fact that the holding of Microsoft versus Baker put plaintiffs who had dismissed their cases with prejudice in a catch-22.

[00:20:57] Speaker 03:
Their dismissal was not sufficiently final to create appellate jurisdiction, but it was sufficiently final to end the case on the merits.

[00:21:06] Speaker 03:
That is obviously not this case,

[00:21:09] Speaker 03:
the plaintiff's case has not ended on the merits.

[00:21:12] Speaker 03:
In fact, no one, either a court or an arbitrator, has ever touched the merits.

[00:21:16] Speaker 03:
We don't have a ruling still on arbitrability.

[00:21:21] Speaker 03:
I don't think this court needs to go any further to affirm the district court's conclusion that Henson simply did not apply.

[00:21:27] Speaker 03:
But if it does, there are two equally compelling reasons to affirm the district court's conclusion that the Henson test wasn't satisfied here.

[00:21:36] Speaker 03:
And the first, Your Honors, is that by its terms,

[00:21:39] Speaker 03:
Henson deals with Rule 60B motions where there has been an intervening change in the law after entry of final judgment.

[00:21:46] Speaker 03:
Obviously, here we don't have a final judgment.

[00:21:48] Speaker 03:
That's already been determined.

[00:21:49] Speaker 03:
But regardless, no matter how many times the plaintiff claims otherwise, there was no change in the law here at the time, even assuming there was a final judgment.

[00:21:59] Speaker 03:
It's important to remember what the law actually was prior to Baker.

[00:22:04] Speaker 03:
Now, the plaintiff says that he dismissed his case based on subtle precedent in this circuit

[00:22:09] Speaker 03:
But in seven years, he's not cited one case that justified the jurisdictional gambit that he took.

[00:22:17] Speaker 03:
It's true that the courts in this circuit have held that they can dismiss or stay as suit after compelling arbitration, which I'll note is a bit of an ironic point for the plaintiff to rely on because in the Rivas case, he claims that the court somehow abused his discretion in doing the very thing he repeatedly notes in this case, of course, he had the right to do.

[00:22:37] Speaker 03:
But regardless,

[00:22:38] Speaker 03:
In every case that the plaintiff cites where a court chose to dismiss rather than stay, appellate jurisdiction was upheld, first, because the case was dismissed with prejudice, and second, because all the claims were deemed subject to arbitration.

[00:22:53] Speaker 03:
That's exactly what the Bloomingdale's and John Mohammadi cases, which the plaintiffs rely, say.

[00:22:59] Speaker 03:
This is from the John Mohammadi case.

[00:23:02] Speaker 03:
The court may either stay the action or dismiss it outright when, as here,

[00:23:07] Speaker 03:
The court determines that all of the claims raised in the action are subject to arbitration.

[00:23:12] Speaker 03:
Here, the district court can determine that any claims were subject to arbitration on the merits.

[00:23:17] Speaker 03:
It merely ruled that whether they were was a question in the first instance for the arbitrator.

[00:23:23] Speaker 03:
And there is no prior from this circuit or anywhere else that I have found which has held that appellate jurisdiction is created by such a non-final order.

[00:23:32] Speaker 03:
The second reason that the district court should be affirmed is that

[00:23:36] Speaker 03:
even if Baker constituted a change in law for purposes of this case.

[00:23:42] Speaker 03:
The notion that the opinion in the first appeal relied on Baker in concluding that the district court's order was not final is based on nothing.

[00:23:51] Speaker 03:
If this court was going to overrule what the plaintiff repeatedly notes was a settled principle of appellate jurisdiction based on this new Supreme Court authority, common sense dictates it would have at least cited Baker or referenced its holding

[00:24:06] Speaker 03:
were noted that it was disagreeing with and overruling the court's prior settled precedent in a way that would impact the rights of litigants throughout the circuit, but it did none of those things, which is likely why when he filed his first motion to reopen in the district court, the plaintiff didn't even make the argument that there was a change in the law.

[00:24:24] Speaker 03:
His motion claimed only that there was a change in facts.

[00:24:26] Speaker 03:
I know he says otherwise in his reply, but I would refer your honors to the motion they filed

[00:24:33] Speaker 03:
That's at pages 3 to 32 of the supplemental excerpts of record.

[00:24:36] Speaker 03:
There is no claim anywhere in there about a change in the law, and there's no reference to Baker at all.

[00:24:43] Speaker 03:
And of course, if this opinion, if this court's opinion in the first appeal actually adopted Baker's reasoning in the arbitration context, why has no court cited it for that proposition?

[00:24:55] Speaker 03:
And why did this court's opinion in Langier include it was addressing an issue of first impression?

[00:25:01] Speaker 03:
when it addressed whether Baker applied to orders dismissing suits with prejudice after the issuance of orders compelling arbitration.

[00:25:08] Speaker 03:
And the plaintiff has no response to any of this other than to say, well, it was discussed a lot in argument.

[00:25:12] Speaker 03:
Of course, there is no authority in the proposition that issues raised in argument, but unmentioned in an opinion, constitute the basis for the court's ruling.

[00:25:21] Speaker 03:
So where does this leave the plaintiff?

[00:25:24] Speaker 03:
The plaintiff claims continually that it's in this paradox.

[00:25:27] Speaker 03:
It's in nothing of the sort.

[00:25:29] Speaker 03:
You can do one of two things.

[00:25:31] Speaker 03:
He can file a new lawsuit this afternoon asserting the same claims.

[00:25:36] Speaker 03:
Of course, it will be met by a motion to compel arbitration.

[00:25:39] Speaker 03:
And if the plaintiff does not like the result of that ruling, he should do what he was required to do under the law.

[00:25:46] Speaker 03:
Ask this court, ask the district court rather to certify it for interlocutory review because there was never a right to have it reviewed otherwise.

[00:25:54] Speaker 03:
Alternatively, he could go to arbitration and make a good faith effort to submit his claims to arbitration to be clear

[00:26:02] Speaker 03:
Council said that plaintiff received a $4,000 invoice from the AAA to arbitrate his claims.

[00:26:07] Speaker 03:
That never happened.

[00:26:09] Speaker 03:
He never received an invoice at all.

[00:26:11] Speaker 03:
What actually happened, and we detailed these facts in our brief.

[00:26:14] Speaker 03:
I'm not going to go through them again unless your honors have questions, is that the AAA concluded that commercial arbitration rules apply.

[00:26:21] Speaker 03:
Plaintiff threw down the gauntlet and said that we're not paying one penny, an interesting position, because he spent over $2,000 to litigate his case in the district court and in this court three times.

[00:26:31] Speaker 03:
and walked away from arbitration.

[00:26:33] Speaker 03:
That's the exact same tactic that the plaintiff employed in a case before the Second Circuit and the Second Circuit saw right through it.

[00:26:40] Speaker 03:
They said that does not constitute a good faith basis to arbitrate.

[00:26:43] Speaker 03:
And before you can walk away from an arbitration like that, you need to actually engage in a good faith effort to arbitrate and let the AAA follow its processes.

[00:26:51] Speaker 03:
None of that happened here.

[00:26:54] Speaker 03:
Unless your honors have any questions, I have nothing further.

[00:26:58] Speaker 01:
Great.

[00:26:59] Speaker 01:
Thank you.

[00:27:00] Speaker 01:
Thank you.

[00:27:05] Speaker 04:
So, Your Honors, a few things that I want to respond to Mr. Leon's argument.

[00:27:10] Speaker 04:
When we asked the District Court to dismiss the case in reliance on the Bloomingdale's decision from this Court, we didn't ask to have the case dismissed without prejudice.

[00:27:22] Speaker 04:
We asked to have the case dismissed

[00:27:25] Speaker 04:
and enter a final judgment so that we could appeal.

[00:27:29] Speaker 04:
The district court on its own threw in the words without prejudice.

[00:27:33] Speaker 02:
Yeah, but wasn't that in your proposed order?

[00:27:36] Speaker 04:
I don't believe it was.

[00:27:38] Speaker 04:
I believe it's in the record at 239.

[00:27:42] Speaker 02:
Mr. Leon said the proposed order, which you submitted with your motion, contained the words without prejudice.

[00:27:55] Speaker 04:
All right, I am checking on that while we speak.

[00:28:02] Speaker 04:
So a lot of things going on here.

[00:28:05] Speaker 04:
Let me try to respond to some of them.

[00:28:09] Speaker 04:
The Bloomingdale's case was proper authority for plaintiff to rely on to believe that it was okay to ask for dismissal of the case in order to obtain

[00:28:20] Speaker 04:
appellate jurisdiction.

[00:28:21] Speaker 04:
Coverall makes this very strained argument that Bloomingdale's is different from this case because there was nothing left to decide.

[00:28:31] Speaker 04:
Whereas here, the district court compelled to arbitration the question of whether the case even had to be arbitrated.

[00:28:42] Speaker 04:
I don't see any difference there.

[00:28:44] Speaker 04:
The court compelled arbitration.

[00:28:47] Speaker 04:
Plaintiff believed that that order even sending to an arbitrator the arbitrability question was improper.

[00:28:54] Speaker 04:
And thus, Bloomingdale's was a sufficient basis at that time to seek an appeal of that decision.

[00:29:03] Speaker 04:
The Bloomingdale's case, for some reason, was not cited by the panel in the first appeal of this case.

[00:29:11] Speaker 04:
I'm sorry.

[00:29:12] Speaker 04:
My colleague just told me that our proposed order did contain the words without prejudice.

[00:29:21] Speaker 04:
So that was an error.

[00:29:23] Speaker 04:
I think we're making very clear that we were seeking an order that would allow us to appeal.

[00:29:28] Speaker 04:
The district court could very well have said, no, I won't do that.

[00:29:32] Speaker 04:
In fact, I've seen other district courts say that, that they won't do that.

[00:29:38] Speaker 04:
So if that was going to be an issue,

[00:29:41] Speaker 04:
I think it was very clear to everyone that what we were doing was seeking dismissal so that we could pursue an appeal.

[00:29:49] Speaker 04:
But meanwhile, we're caught again in this catch-22 where somehow the district court order wasn't final, so we couldn't appeal it, but now we can't get back to the district court in order to challenge it.

[00:30:01] Speaker 00:
And your claim is that if the district court had granted a motion to dismiss with prejudice, that you could have taken an appeal?

[00:30:10] Speaker 04:
Well, at the time, we believed we could have.

[00:30:12] Speaker 04:
And we were relying on the Bloomingdale's decision.

[00:30:15] Speaker 04:
But then later, the Supreme Court issued the Baker versus Microsoft decision, which said you can't manufacture appellate jurisdiction through voluntary dismissal.

[00:30:23] Speaker 00:
Right.

[00:30:23] Speaker 00:
So that ultimately would not have worked anyway.

[00:30:26] Speaker 04:
Right, so what we needed to do after those rulings was go back to the district court and ask it to certify the issue under 1292, which is what we tried to do.

[00:30:37] Speaker 04:
But then when we went back to the district court, in order to seek that 1292 certification, the district court said no, because it wouldn't grant our motion to reopen the case.

[00:30:48] Speaker 04:
So that is why plaintiff has been stuck with nowhere to go.

[00:30:54] Speaker 00:
Can you refile a complaint?

[00:30:56] Speaker 04:
Well, I suppose we could refile a complaint, but 12 years of, or eight years of damages would now be gone because we wouldn't, if we had to start from scratch.

[00:31:15] Speaker 04:
And again, this has really been a colossal run around.

[00:31:20] Speaker 04:
Just stepping back from all of this, of course, the whole purpose of the Federal Arbitration Act and arbitration is supposed to make

[00:31:26] Speaker 04:
dispute resolution more simple and speedy and efficient eight years in when we haven't even gotten a ruling on whether arbitration was properly ordered.

[00:31:35] Speaker 04:
We're nowhere close to even getting that answer.

[00:31:39] Speaker 01:
Great.

[00:31:39] Speaker 01:
Thank you both for the helpful argument.

[00:31:41] Speaker 01:
Thank you.

[00:31:43] Speaker 01:
It's been submitted.