вторник, 10 марта 2015 г.

In an order issued on December 31, 2013, the district court granted Turnberry's motion to disqualify


IN RE: Mary Ann SUSSEX; Mitchell Pae; Malcolm Nicholl; Sandy Scalise; Ernesto Valdez, Sr.; Ernesto Valdez, Jr.; John Hanson; Elizabeth Hanson. Mary Ann Sussex; Mitchell Pae; Malcolm Nicholl; Sandy Scalise; Ernesto Valdez, Sr.; Ernesto Valdez, Jr.; John Hanson; Elizabeth Hanson, Petitioners, v. United States las vegas travel specials District Court for the District of Nevada, Las Vegas, las vegas travel specials Respondent, Turnberry/MGM Grand Towers, LLC; MGM Grand Inc., Doing Business as MGM Mirage; Turnberry/Harmon Ave., LLC; MGM Grand Condominiums, LLC; Signature Condominiums, LLC; Turnberry West Realty, Inc.; MGM Resorts International, las vegas travel specials Real Parties in Interest.
Norman B. Blumenthal (argued) and Kyle Nordrehaug, Blumenthal, Nordrehaug & Bhowmik, La Jolla, CA; Robert Gerard, Gerard & Associates, Las Vegas, NV, for Petitioners. Steve Morris las vegas travel specials (argued), Akke Levin, and Jean–Paul Hendricks, Morris Law Group, Las Vegas, NV; Alex Fugazzi and Justin Carley, Snell & Wilmer LLP, Las Vegas, NV, for Real Party in Interest Turnberry/MGM Grand Towers, LLC. Yvette Ostolaza, Yolanda C. Garcia, and Robert Velevis, Sidley Austin LLP, Dallas, TX, for Real Party in Interest MGM Resorts International. No appearance for Respondent.
Sussex and other petitioners (collectively, “Sussex”) seek a writ of mandamus directing a district court to vacate its grant of a motion, while arbitration was pending, to disqualify an arbitrator for evident partiality under 9 U.S.C. § 10(a)(2). We have jurisdiction las vegas travel specials pursuant to the All Writs Act, 28 U.S.C. § 1651, and hold that mandamus is warranted under the circumstances of this case. See Bauman v. U.S. Dist. Court, 557 F.2d 650 (9th Cir.1977). We therefore grant the petition.
las vegas travel specials In the litigation giving rise to this petition for a writ of mandamus, hundreds of purchasers of condominium units in a luxury condominium project brought several different civil actions las vegas travel specials against the developer and seller of the project, Turnberry/MGM Grand Towers, LLC, and several affiliates (collectively, “Turnberry”), raising a wide range of fraud and other claims, las vegas travel specials and seeking rescission of their purchase agreements or money damages. Two separate lawsuits raising substantially identical claims, Sussex et al. v. Turnberry/MGM Grand Towers, LLC et al., No. 2:08–cv–0773, and Abraham et al. v. Turnberry/MGM Grand Towers, LLC et al., No. 2:11–cv–01007, were filed in district court, and were subsequently consolidated for purposes of the motion at issue here. A third action raising similar claims was filed in Nevada state court, las vegas travel specials KJH & RDA Investor Group, LLC et al. v. Turnberry/MGM las vegas travel specials Grand Towers, LLC et al., No. 51159.
All of the plaintiffs had entered into the same form condominium purchase and sale agreement, in which they agreed “to submit to arbitration any dispute” related to the agreement and agreed that any arbitration would be conducted under the rules of the American Arbitration Association (AAA). Sussex and KIH were submitted to arbitration in 2009.
In February 2010, the AAA appointed Brendan Hare, an attorney in private practice, to serve as arbitrator for Sussex. He would eventually become the arbitrator las vegas travel specials for all three cases (Sussex, las vegas travel specials Abraham and KIH ). The arbitration process in Sussex commenced las vegas travel specials in February 2011. Around the same time, Hare became involved las vegas travel specials in some business ventures to finance litigation for investment purposes. las vegas travel specials He founded Bowdoin Street Capital, a firm that “invests in high-value, high-probability legal claims and litigations,” including “all manner of meritorious claims,” and created a website to attract investors to the firm. A few months later, Hare participated as a panelist in the Litigation Finance and Investment Summit in New York, on a panel entitled las vegas travel specials “Perspectives on Investing in Litigation and Legal Finance las vegas travel specials Companies” addressing “the drivers for investing in litigation finance, including expected returns, assembling a portfolio, and risk assessment/risk mitigation.” Hare participated in a similar panel in March 2012. In February 2013, his online LinkedIn profile stated that he had “recently refocused his practice to concentrate on the emerging field of Litigation Finance and Funding.” Hare filled out a new conflicts disclosure form in February 2012, but did not disclose these litigation financing activities.
After learning about Hare's creation of Bowdoin and efforts in the field of litigation financing, Turnberry made several requests to the AAA to disqualify Hare and stay the arbitration. The AAA investigated Turnberry's charge that Hare's involvement with Bowdoin created a conflict of interest. In response to the AAA's inquiry, Hare stated that Bowdoin was “an entity I created to explore las vegas travel specials the possibility of creating a fund to provide capital for litigation,” but stated that he had “raised no money, and made no investments” and “[e]xcept for a vestigial web presence” the company was “completely dormant.” The AAA subsequently denied Turnberry's requests for Hare's disqualification.
While the AAA was considering these objections, Turnberry moved to disqualify Hare in the state case, KJH. After some litigation in state courts, the KJH plaintiffs agreed to proceed without Hare. In September 2013, Turnberry then filed motions to disqualify Hare in the Sussex and Abraham cases pending in district court. The district court granted an emergency request to stay the arbitration in the two consolidated cases.
In an order issued on December 31, 2013, the district las vegas travel specials court granted Turnberry's motion to disqualify Hare. The district court ruled that it had the authority to intervene in the ongoing arbitration, citing Aerojet–General Corp. v. Am. Arbitration Ass'n, 478 F.2d 248 (9th Cir.1973), for the proposition las vegas travel specials that intervention in ongoing arbitration proceedings was possible las vegas travel specials in “extreme cases.” The district court then determined that intervention was warranted in this case, in light of several factors. First, the consolidated arbitrations las vegas travel specials were large, involving the claims of 385 plaintiffs. Second, the proceedings were still in the early stages. Discovery had not yet begun, and Hare had issued only preliminary rulings. The district court also noted that the state case, KJH, would be proceeding with a new arbitrator. Finally, the district court held that at the end of the arbitration, Turnberry would be likely to prevail on a motion to vacate any award Hare issued on the ground of “evident partiality,” a basis for vacating an arbitration award under the Federal Arbitration Act, 9 U .S.C. § 10(a)(2). 1 The district court reasoned that the undisclosed facts regarding Hare's litigation financing activities suggested he had a financial interest in the outcome of the arbitration, because a victory and large financial award for Sussex would help Hare promote his company, which was designed to generate profits from funding large, potentially profitable litigations. According to the district court, Hare's business venture would create a reasonable impression of bias sufficient to meet the § 10(a)(2) standard. If the award were vacated, the parties would have to repeat the arbitration process, which would result in a waste of time and resources. Accordingly, las vegas travel specials the district court entered an order removing Hare from the federal cases. Sussex filed a timely petition for writ of mandamus.
“A writ of mandamus is an extraordinary or drastic remedy, used only to confine an inferior court to a lawful exercise of its prescribed las vegas travel specials jurisdiction or to compel it to exercise its authority when it is its duty to do so.” DeGeorge v. U.S. Dist. Court, 219 F.3d 930, 934 (9th Cir.2000) (citation and internal quotation marks omitted). A “judicial readiness to issue the writ of mandamus in anything less than an extraordinary situation” would defeat longstanding Congressional policy against appellate review las vegas travel specials before final judgment in the district court and would result in piecemeal litigation. Kerr v. U.S. Dist. Court, 426 U.S. 394, 403 (1976). A petitioner must therefore las vegas travel specials prove a right to issuance of the writ that is “clear and indisputable.” DeGeorge, 219 F .3d at 934 (quoting Bankers Life & Cas. Co. v. Holland, 346 U.S. 379, 384 (1953)).
In determining whether a petitioner has carried las vegas travel specials the burden of establishing a “clear and indisputable” right to issuance of the writ, we examine the five factors set forth in Bauman v. U.S. Dist. Court, 557 F.2d 650 (9th Cir.1977):
(1) The party seeking the writ has no other adequate means, such as a direct appeal, to attain the relief he or she desires. (2) The petitioner will be damaged or prejudiced in a way not correctable on appeal. (This guideline is closely related to the first.) las vegas travel specials (3) The district court's order is clearly erroneous as a matter of law. (4) The district court's order is an oft-repeated error, or manifests las vegas travel specials a persistent disregard of the federal rules. (5) The district court's order raises new and important problems, or issues of law of first impression.
Bauman, 557 F.2d at 654–55 (citations omitted). We weigh these factors together to determine whether, on balance, they justify the invocation of “this extraordinary remedy.” Id. at 654–55 (internal quotation marks omitted). The factors are not to be “mechanically applied”; we are neither compelled to grant the writ when all five factors are present, nor prohibited from doing so when fewer than five, or only one, are present. Cole v. U.S. Dist. Court, 366 F.3d 813, 817 (9th Cir.2004). “[I]nstead, las vegas travel specials the decision whether to issue the writ is within the discretion of the court.” Id. (citing Kerr, 426 U.S. at 403).
Because we have held that “the absence of factor las vegas travel specials three—clear error as a matter of law—will always defeat a petition for mandamus,” DeGeorge, 219 F.3d at 934 (internal quotation marks omitted), we begin by determining whether the district court committed clear error by intervening mid-arbitration to remove Hare. Although the clear error standard is “highly deferential,” In re Van Dusen, 654 F.3d 838, 841 (9th Cir.2011), we have held that “a definite and firm conviction that a mistake has been c

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