UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
)
YOUNG N. CHO, )
)
Plaintiff, )
)
v. ) No. 17-cv-0453 (KBJ)
)
MALLON & MCCOOL, LLC, et al., )
)
Defendant. )
)
MEMORANDUM OPINION
On February 18, 2017, Plaintiff Young Cho filed an eleven -count complaint in
D.C. Superior Court alleging that Defendants Steven McCool, Joseph Mallon, and
Mallon & McCool, LLC (collectively, “Defendants”) committed a series of fraudulent
and negligent acts while representing Cho in previous legal proceedings , resulting in
purportedly excessive legal fees. (See generally Compl., Ex. 2 to Defs.’ Notice of
Removal, ECF No. 1-2.) Before this Court at present is Cho’s motion to stay the case
and compel arbitration pursuant to the Federal Arbitration Act, 9 U.S.C. §§ 3, 4. (See
Pl.’s Mot. to Compel Arbitration and Stay the Case (“Pl.’s Mot.”), ECF No. 11-1, at 3.) 1
For the reasons that follow, this Court concludes that because Cho has forfeited any
right to arbitration that he may once have possessed, Cho’s Motion to Compel
Arbitration and Stay the Case must be DENIED. A separate Order consistent with this
Memorandum Opinion shall follow.
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Page-number citations to documents the parties have filed refer to the page numbers that the Court’s
electronic filing system assigns.
DISCUSSION
The Federal Arbitration Act (“FAA”) authorizes courts, under certain
circumstances, to stay proceedings referable to arbitration and/or compel the parties to
arbitrate pursuant to a valid written agreement. See 9 U.S.C. §§ 3, 4. Significantly for
present purposes, the D.C. Circuit has unequivocally emphasized that the timing of a
party’s request to stay a case pending arbitration matters: it has held that a defendant
who seeks a stay pending arbitration under Section 3 of the FAA but “who has not
invoked the right to arbitrate on the record at the first available opportunity, typically
in filing his first responsive pleading or motion to dismiss, has presumptively forfeited
that right.” Zuckerman Spaeder, LLP v. Auffenberg, 646 F.3d 919, 922 (D.C. Cir. 2011)
(emphasis added); see also id. at 924 (“By this opinion we alert the bar in this Circuit
that failure to invoke arbitration at the first available opportunity will presumptively
extinguish a client’s ability later to opt for arbitration.”). However, a party still can
“overcome the presumption of having forfeit his right to a stay” if “his conduct in
litigation after the first responsive pleading imposed no or little cost upon opposing
counsel and the courts.” Id. at 923; see also id.
Additionally, it appears that “[t]he right to arbitration, like any contract right,
can be waived[,]” even if it is not forfeited. Nat’l Found. for Cancer Research v. A.G.
Edwards & Sons, Inc., 821 F.2d 772, 774 (D.C. Cir. 1987). Such waiver can occur in
several ways; for example, through “active participation in a lawsuit[,]” or by taking
other actions that are otherwise “inconsistent[] with the arbitration right[,]” Khan v.
Parsons Glob. Servs., Ltd., 521 F.3d 421, 42425 (D.C. Cir. 2008) (internal quotation
marks and citations omitted). “In this circuit, the court views the totality of the
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circumstances [in deciding whether] the defaulting party has acted inconsistently with
the arbitration right.” Id. at 425 (alteration in original) (internal quotation marks and
citation omitted). Compare id. at 428 (finding that the defendant waived its right to
compel arbitration by filing a motion to dismiss, or alternatively, for summary judgment
or to compel arbitration, because the defendant’s actions were “inconsistent with
preserving the right to compel arbitration” notwithstanding the otherwise “limited
extent of [the defendant’s] litigation activity[,]” and because the plaintiffs had “suffered
significant prejudice”), with Davis Corp. v. Interior Steel Equip. Co., 669 F. Supp. 32,
33, 34 (D.D.C. 1987) (holding that subcontractor did not waive right to arbitration by
filing an action in federal court to protect against the statute of limitations, or by
participating in minimal discovery, where subcontractor “consistently maintained that
the dispute should be subject to arbitration” (emphasis in original)).
In the instant matter, Cho contends that a stay of this case in order to arbitrate
the pending attorneys’ fees issues is warranted because both Rule 4 of the
Attorney/Client Arbitration Board (“ACAB”) Rules and Rule XIII of the Rules
Governing the District of Columbia Bar (“Bar Rules”) provide that a lawyer is deemed
to have agreed to arbitrate a fee dispute whenever a client requests arbitrati on on that
issue. (See Pl.’s Mot. at 4.) However, even assuming, arguendo, that the ACAB and/or
Bar Rules provide a valid basis for Cho to demand arbitration under the FAA—which,
by its express terms, requires “an agreement in writing” that expresses the parties’
assent to arbitration, 9 U.S.C. § 3 (emphasis added); see also id. § 4—Cho’s motion to
stay cannot be countenanced because Cho has not previously asserted his right to
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arbitration in the context of this proceeding, and has repeatedly acted inconsistently
with an intent to exercise any arbitration right that he may have possessed.
The timeline of Cho’s protracted litigation belies any suggestion that Cho
invoked arbitration at the first available opportunity. On February 22, 2016, Cho filed a
substantially similar eleven-count complaint in D.C. Superior Court, which contained
no reference to arbitration. (See Compl., Dkt. No. 1-1, in Civ. Action No. 16-cv-0562,
at 1152.) After Defendants removed Cho’s case to this Court and filed two motions to
dismiss, Cho once again failed to request arbitration, and instead asked for an extension
of time to “prepare a response to Defendants’ two motions to dismiss” and to obtain the
necessary documentation in support thereof. (Pl.’s Second Consent Mot. for
Enlargement of Time, Dkt. No. 13, in Civ. Action No. 16-cv-0562, at 2.) Cho then filed
two separate oppositions to Defendants’ motions to dismiss (see Pl.’s Mem. in Opp’n to
Defs.’ Mot. to Dismiss Pursuant to Rule 12(b)(1), Dkt. No. 14, in Civ. A ction No. 16-
cv-0562; Pl.’s Mem. in Opp’n to Defs.’ Mot. to Dismiss Pursuant to Rule 12(b)(6), Dkt.
No. 15, in Civ. Action No. 16-cv-0562)—neither of which invoked any right to
arbitration—and shortly after Defendants’ motions to dismiss became ripe, Cho sought
leave to file two sur-replies in further opposition to Defendants’ motions; his motions
for leave omitted any reference to arbitration (see Pl.’s Mot. for Leave to File Sur-
Reply in Opp’n to Defs.’ Mot. to Dismiss Pursuant to Rule 12(b)(1), Dkt. No. 18, in
Civ. Action No. 16-cv-0562; Pl.’s Mot. for Leave to File Sur-Reply in Opp’n to Defs.’
Mot. to Dismiss Pursuant to Rule 12(b)(6), Dkt. No. 19, in Civ. Action No. 16 -cv-
0562). Then, on October 13, 2016, Cho filed a notice of voluntary dismissal of his case
(see Pl.’s Stipulation of Dismissal Without Prejudice, Dkt. No. 21, in Civ. Action No.
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16-cv-0562), yet he did not thereafter seek to arbitrate his claims (see Defs.’ Opp’n to
Pl.’s Mot., ECF No. 13, at 7).
Instead, four months later, on February 18, 2017, Cho initiated the instant action
in D.C. Superior Court (see Compl.) and, once again, Defendants removed the case to
this Court and filed two motions to dismiss (see Defs.’ Mot. to Dismiss Pursuant to
Rule 12(b)(1), ECF No. 3; Defs.’ Mot. to Dismiss Pursuant to Rule 12(b)(6), ECF No.
8). In response, Cho did not invoke a right to arbitration; rather, he sought (and
received) two extensions of time to prepare oppositions to Defendants’ motions. (See
Pl.’s First Consent Mot. for Enlargement of Time, ECF No. 10; Pl.’s Second Mot. for
Enlargement of Time, ECF No. 12.) It was only after more than thirteen months had
passed, and after he had initiated two lawsuits, that Cho finally filed the instant motion
to stay the case and compel arbitration. (See Pl.’s Mot.)
In this Court’s view, there is no question that Cho has presumptively forfeited
his right to stay the case pursuant to 9 U.S.C. § 3 by failing “to invoke arbitration at the
first available opportunity.” Auffenberg, 646 F.3d at 924. To be sure, the Auffenberg
court articulated a forfeiture standard applicable when the party requesting arbitration is
the defendant, and as a result, it is not entirely clear from Auffenberg when a plaintiff’s
“first available opportunity” to invoke arbitration occurs. See also id. at 922
(explaining that a defendant’s first available opportunity is “typically in filing his first
responsive pleading or motion to dismiss”). But even assuming, arguendo, that a
plaintiff’s first opportunity to invoke arbitration in the course of litigation can arise
sometime after the filing of the complaint, it is clear on the facts of this case that Cho
did not invoke his right to arbitrate at the earliest available opportunity; indeed, Cho’s
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prior lawsuit proceeded for nearly eight months before Cho voluntarily dismissed that
action, and even at that point, Cho did not seek to arbitrate his claims. (See Defs.’
Opp’n to Pl.’s Mot., ECF No. 13, at 7.) Moreover, Cho took no steps to arbitrate his
claims in the four ensuing months (see id.), and instead ultimately opted to initiate the
instant action.
Cho insists that this Court should discount this chronology because he “regularly
conferred with Defendants to resolve the case by settlem ent[.]” (Pl.’s Reply Mem. in
Supp. of Pl.’s Mot. (“Pl.’s Reply”), ECF No. 14, at 4.) But “that representation is
nowhere documented in the record[,]” and it is well established that “a court
considering a question of forfeiture is properly concerned only with intentions placed
upon the record.” Auffenberg, 646 F.3d at 923. What the record in this case does make
crystal clear is that, by failing to assert his right to arbitrate timely, Cho’s litigation
activities have imposed substantial costs on Defendants and on this Court, which is
sufficient to defeat Cho’s contention that he is entitled to seek arbitration now. See id.
(suggesting that a defendant can “overcome the presumption of having forfeit his right
to a stay” if “his conduct in litigation after the first responsive pleading imposed no or
little cost upon opposing counsel and the courts”).
Notably, and for what it is worth, the same facts that give rise to a forfeiture
finding as discussed above also demonstrate that Cho has waived any right to arbitrate. 2
Cho’s active participation in litigating his claims against these defendants was vigorous
2
The D.C. Circuit appears to have departed from the waiver approach to evaluating Section 3 motions
to stay pending arbitration. See Auffenberg, 646 F.3d at 922 (noting that, from 1966 through 2008, the
Circuit “referred to the question of default exclusively in terms of waiver[,]” but this standard
“established few bright-line rules[,]” and thus, “imposed a cost upon both litigants and the district
court”).
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and intentional, as described above. Furthermore, Cho’s current representation that he
initiated the February 2016 case “[i]n order to preserve his claims under the statute of
limitations” (Pl.’s Reply at 4) is of no moment, because, regardless, Cho actively
prosecuted his claims, and did not “consistently maintain[] that the dispute should be
submitted to arbitration.” Davis, 669 F. Supp. at 33 (emphasis in original).
CONCLUSION
Because Cho has failed to invoke arbitration at his first available opportunity and
has repeatedly acted inconsistently with any right to arbitrate, he has forfeited any
arbitration right he may once have possessed such that his request for arbitration at this
juncture cannot be honored. Accordingly, as set forth in the accompanying Order,
Cho’s Motion to Compel Arbitration and Stay the Case (ECF No. 11) is DENIED.
DATE: July 11, 2017 Ketanji Brown Jackson
KETANJI BROWN JACKSON
United States District Judge
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