USCA11 Case: 19-12100 Date Filed: 10/28/2020 Page: 1 of 4
[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
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No. 19-12100
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D.C. No. 1:16-cv-20194-DPG
LYNN MCCULLOUGH, et al.,
Plaintiffs-Appellees,
versus
AIG INSURANCE HONG KONG LIMITED,
Defendant-Appellant.
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Appeal from the United States District Court
for the Southern District of Florida
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(October 28, 2020)
Before WILSON, NEWSOM and ANDERSON, Circuit Judges.
USCA11 Case: 19-12100 Date Filed: 10/28/2020 Page: 2 of 4
PER CURIAM:
This is an appeal challenging a district court decision that relied entirely on
our decision in Outokumpu Stainless USA, LLC v. Converteam SAS, 902 F.3d
1316 (11th Cir. 2018). Our decision involved contracts containing an identical
arbitration clause between a steel manufacturing plant and a general contractor
providing, inter alia, for the manufacture and supply of certain motors. The
contracts were each signed by those two parties. A subcontractor of the general
contractor actually manufactured and supplied the motors. The subcontractor did
not sign the contracts containing the arbitration clause. The steel plant sued the
subcontractor after the motors failed. The subcontractor sought to enforce the
arbitration agreement. The contracts containing the arbitration clause were subject
to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards
(the “New York Convention”). The Eleventh Circuit held that the non-signatory
subcontractor could not compel arbitration. We held that the New York
Convention required that the parties actually sign the agreement containing the
arbitration clause. Id. at 1326. We held that the non-signatory subcontractor could
not rely on domestic equitable estoppel doctrines to enforce the arbitration
agreement as a non-signatory because equitable estoppel doctrines conflict with the
New York Convention’s signatory requirement. Id. at 1326–27.
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The instant case, like Outokumpu, presents the issue of whether and under
what circumstances a non-signatory is bound by an agreement to arbitrate. We
write only for the parties, who are fully familiar with the relevant facts. We note
here only that Plaintiffs Lynn and William McCullough (the “McCulloughs”) are
injured third parties who sought tort damages against the “Rain Forest defendants,”
and who now claim that AIG Insurance Hong Kong Limited (“AIG”) insured one
or more of such defendants and failed in good faith to settle. The McCulloughs
settled with the Rain Forest defendants, and now sue AIG, as Florida law allows,
for breach of its duty to its insureds to exercise good faith to settle the case within
its policy limits and protect its insureds against excess judgment. AIG sought to
compel the non-signatory McCulloughs to arbitrate pursuant to the policy
provisions binding on AIG and the Rain Forest defendants.
As noted above, the district court relied entirely on our decision in
Outokumpu in declining to grant AIG’s motion to compel arbitration. Thus, the
district court did not address AIG’s argument that applicable equitable doctrines
permitted enforcement of the arbitration agreement against the non-signatory
McCulloughs.
However, after the district court decision in this case, and after the briefing
on appeal, the Supreme Court in GE Energy Power Conversion France SAS, Corp.
v. Outokumpu Stainless USA, LLC, reversed our decision. ___ U.S. ___, 140 S.
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Ct. 1637 (June 1, 2020). Contrary to the Eleventh Circuit decision, the Supreme
Court held that nothing in the New York Convention conflicts with the application
of relevant equitable doctrines. Accordingly, the Court reversed the judgment of
the Eleventh Circuit and remanded for further proceedings with respect to such
doctrines.
Consistent with that Supreme Court ruling, we also vacate the judgment of
the district court and remand for further proceedings not inconsistent with this
opinion or the opinion of the Supreme Court in Outokumpu. 1
VACATED and REMANDED.
1
We understand that the issue of coverage must also be determined on remand, as well as
possibly other issues.
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