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Arabian Motors Group W.L.L. v. Ford Motor Co.

United States District Court, E.D. Michigan, Southern Division

May 22, 2017

ARABIAN MOTORS GROUP W.L.L., Plaintiff,
v.
FORD MOTOR COMPANY, Defendant.

          OPINION AND ORDER DENYING PLAINTIFF'S MOTION FOR A CERTIFICATE OF APPEALABILITY (ECF #26)

          MATTHEW F. LEITMAN UNITED STATES DISTRICT JUDGE

         Plaintiff Arabian Motors Group, W.L.L., a Kuwaiti automobile dealer, and Defendant Ford Motor Company are parties to an automobile resale agreement (the “Resale Agreement”). The Resale Agreement contains a provision that requires the parties to arbitrate certain disputes. A dispute arose, and in March 2016, Ford commenced arbitration proceedings against Arabian Motors.

         Arabian Motors later filed this civil action and filed a motion for a preliminary injunction to stay the arbitration. (See the “Injunction Motion, ” ECF #5.) Arabian Motors' request for injunctive relief rested upon the Motor Vehicle Franchise Contract Arbitration Fairness Act, 15 U.S.C. § 1226 (the “Fairness Act” or the “Act”). The Fairness Act provides that “whenever a motor vehicle franchise contract provides for the use of arbitration to resolve a controversy arising out of or relating to such contract, arbitration may be used to settle such controversy only if after such controversy arises all parties to such controversy consent in writing to use arbitration to settle such controversy.” 15 U.S.C § 1226(a)(2) (emphasis added). Arabian Motors argued that under the Fairness Act, because it did not consent to use arbitration after its dispute with Ford arose, (1) it could not be compelled to arbitrate its dispute with Ford and (2) a provision of the Resale Agreement delegating the question of arbitrabiity to the arbitrator (the “Delegation Provision”) was unenforceable. (See Injunction Motion, ECF #5.)

         The Court disagreed with Arabian Motors and denied the Injunction Motion. (See the “Opinion and Order, ” ECF #18.) The Court concluded that the Fairness Act does not apply to contracts - like the Resale Agreement - between domestic manufacturers and foreign dealers; that the Act did not preclude enforcement of the Delegation Provision; and that under that provision, the arbitrator, not the Court, should decide whether Arabian Motors could be compelled to arbitrate its dispute with Ford. (See id.) On that basis, the Court declined to enjoin the arbitration. The Court subsequently denied Arabian Motors' motion for reconsideration. (See ECF #24.)

         Arabian Motors now moves the Court to certify the Opinion and Order for an interlocutory appeal. (See ECF #26.) For the reasons explained below, the Court declines to grant the requested certification and therefore DENIES the motion.

         I

         A

         Ordinarily, a party may appeal as a matter of right from a district court's order denying a motion for preliminary injunction. See 28 U.S.C. § 1292(a). But Section 16(b)(4) of the Federal Arbitration Act exempts from this general rule orders “refusing to enjoin an arbitration.” 9 U.S.C. § 16(b)(4). These orders may be appealed only “as otherwise provided in section 1292(b) of title 28” (“Section 1292(b)”). Id. The “reason behind [this] dichotomy is that the policy of prompt and efficient adjudication through arbitration should not be undermined by interlocutory appeal.” Adler v. Dell, Inc., 2009 WL 646885, at *1 (E.D. Mich. Mar. 10, 2009).

         B

         Section 1292(b) establishes the criteria that must be satisfied before a party may take an interlocutory appeal in a civil action. It provides:

When a district judge, in making in a civil action an order not otherwise appealable under this section, shall be of the opinion that [1] such order involves a controlling question of law [2] as to which there is substantial ground for difference of opinion and [3] that an immediate appeal from the order may materially advance the ultimate termination of the litigation, he shall so state in writing in such order. The Court of Appeals which would have jurisdiction of an appeal of such action may thereupon, in its discretion, permit an appeal to be taken from such order, if application is made to it within ten days after the entry of the order: Provided, however, That application for an appeal hereunder shall not stay proceedings in the district court unless the district judge or the Court of Appeals or a judge thereof shall so order.

28 U.S.C. § 1292(b) (emphasis in original). The party seeking permission for an interlocutory appeal bears the burden of showing that each of these listed requirements are satisfied, see Vitols v. Citizens Banking Co., 984 F.2d. 168, 170 (6th Cir. 1993), and a district court may not certify an order for review under Section 1292(b) unless it “expressly find[s] that all three” of the “requirements are met.” Couch v. Telescope, Inc., 611 F.3d 629, 633 (9th Cir. 2010) (emphasis added); see also Ahrenholz v. Board of Trustees of University of Illinois, 219 F.3d 674, 676 (7th Cir. 2000) (“Unless all these criteria are satisfied, the district court may not and should not certify its order to us for an immediate appeal under section 1292(b).”).

         The United States Court of Appeals for the Sixth Circuit has emphasized that “[r]eview under § 1292(b) is granted sparingly and only in exceptional cases.” In Re City of Memphis, 293 F.3d 345, 350 (6th Cir. 2002). As that court has explained:

It is quite apparent from the legislative history of the Act of September 2, 1958 that Congress intended that section 1292(b) should be sparingly applied. It is to be used only in exceptional cases where an intermediate appeal may avoid protracted and expensive litigation and is not intended to open the floodgates ...

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