In The
Court of Appeals
Ninth District of Texas at Beaumont
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NO. 09-20-00153-CV
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IN RE THOMAS N. CAMPBELL, ET AL
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Original Proceeding
284th District Court of Montgomery County, Texas
Trial Cause No. 18-12-15871-CV
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MEMORANDUM OPINION
Relators Thomas N. Campbell, Christy W. Kolva, Foster Management,
L.L.C., and Foster Timber, LTD. filed a petition for writ of mandamus, in which
they ask this Court to (1) quash the trial court’s orders granting a two-month
continuance of relators’ application to confirm the arbitration award and permitting
the Scatena defendants 1 to conduct post-arbitration discovery, and (2) order the trial
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The real parties in interest are Robin S. Rouse, Terrill A. Scatena, Sabrina
Rouse, Neil F. Campbell, Jr., Benjamin Campbell, and JP Morgan Chase Bank, N.A.
We will refer to real parties in interest Robin S. Rouse, Terrill A. Scatena, and
Sabrina Rouse as “the Scatena defendants.”
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court to “promptly consider” the final award the arbitrator entered in relators’ favor.
For the reasons explained herein, we conditionally grant the petition for writ of
mandamus.
BACKGROUND
Relators assert that the underlying proceeding was arbitrated pursuant to the
rules of the American Arbitration Association (“AAA”). On March 23, 2020, after
a thirteen-month arbitration, the arbitrator, Theodore F. Weiss, entered an award in
relators’ favor “that dissolves a family timber business hobbled by generations of
family rancor[]” and orders liquidation of the business. On December 19, 2019,
during the pendency of the arbitration, the Scatena defendants’ attorney objected by
letter to Weiss serving as arbitrator. In the letter, the Scatena defendants asserted that
(1) in 1995, Weiss and relators’ lead attorney were co-defendants in a case that was
reversed on appeal, (2) Weiss and relators’ lead attorney, Robin Gibbs, attended the
same law school, and they both served on Law Review, although Gibbs was one
class year behind Weiss, and (3) Weiss’s son practices law at a firm established by
lawyers who previously practiced at the firm representing relators. The Scatena
defendants argued that the arbitration “may have been materially prejudiced because
the Arbitrator is unable to be impartial and independent.”
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Weiss responded that one of his sons knew Marshal Hoda, a second-year
associate at relators’ counsel’s law firm and a member of relator’s trial team. Weiss
stated that his son and Hoda realized while playing on the same team in a lawyers’
basketball league that Hoda was working on an arbitration in which Weiss is the
arbitrator, and “[t]hey agreed at that time that they would not discuss the case.”
Weiss also stated that although both he and Gibbs were on Law Review, he did not
recall working with Gibbs on Law Review, but he stated that “it is possible” that he
did. Relators responded that Weiss’s supplemental disclosure confirmed that there
is no basis for questioning Weiss’s impartiality, and relators characterized the
interactions between Weiss’s son and members of relators’ law firm as “casual and
random” and stated that such interactions “would not lead any reasonable person to
question Mr. Weiss’s ability to rule impartially[.]”
AAA’s Administrative Review Council (“ARC”) reviewed the Scatena
defendants’ objection to Weiss serving as arbitrator, and on January 8, 2020, ARC
“determined that Arbitrator Weiss shall be reaffirmed as an arbitrator[.]” ARC
explained that its “rule on disqualification provides that an arbitrator shall be subject
to disqualification for partiality or lack of independence, inability or refusal to
perform his or her duties with diligence and in good faith, and any grounds for
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disqualification provided by applicable law.” ARC also explained that “the AAA’s
decision regarding an objection to an arbitrator is conclusive.”
As discussed above, on March 23, 2020, Weiss entered a final award in
relators’ favor that dissolved the business and ordered its liquidation. On the same
date, relators filed an application to confirm the arbitration award. The Scatena
defendants filed an objection to the arbitration award, requested post-arbitration
discovery, and moved for continuance, and asked the trial court to schedule the case
“for an oral and evidentiary hearing[] rather than submission.” Specifically, they
asserted that their “rights were prejudiced by the evident partiality of the Arbitrator
because the Arbitrator and [relators’ law firm] failed to disclose” that Weiss and
Gibbs were classmates at law school and peers on Law Review; Weiss’s son works
for a firm founded by two partners who previously practiced at relators’ counsel’s
firm; and Weiss’s son “is friends with Marshal Hoda” and they played on the same
basketball team while the arbitration was pending; and Weiss’s son has recently been
involved in two cases with relators’ counsel, Gibbs. The Scatena defendants asserted
that they were entitled to post-arbitration discovery to flesh out relevant undisclosed
facts regarding its claim of evident partiality. The Scatena defendants also filed a
motion to vacate the arbitration award, in which they again asserted, inter alia,
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Weiss’s alleged “evident partiality[.]” Real party in interest Neil F. Campbell, Jr.
also moved to vacate the arbitration award for alleged evident partiality.
On April 20, 2020, the trial court signed an order granting the Scatena
defendants’ motion for continuance, in which the trial court ordered that “all
[a]pplications related to the arbitration shall be discussed at the Zoom hearing
currently scheduled for April 30, 2020[.]” 2 At the Zoom hearing on April 30,
relators’ counsel argued that the Scatena defendants first raised the issue of evident
partiality on the eve of final argument in the arbitration proceeding, and he explained
that the Scatena defendants’ objection was based upon counsel’s attendance at law
school with Weiss fifty years ago, where they might have worked together on Law
Review, and that Weiss’s son played on a recreational basketball team with Marshal
Hoda. Relators’ counsel asserted that the ARC reviewed the matter and determined
that no evident partiality existed, and that ARC’s ruling is conclusive. According to
relators’ counsel, the Scatena defendants did not cite “to a single case on anything
like these facts permitting discovery and not a single case has ever suggested that
you would reverse an ARC determination.” The Scatena defendants’ counsel
asserted that they desired to depose Hoda, and relators’ counsel argued that the
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Relators’ application to confirm the arbitration award was included within
the scope of the trial court’s April 20 order.
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Scatena defendants had not demonstrated materiality or financial interests that have
“anything to do with partiality.” Relators’ counsel argued that the parties committed
to arbitrate the issue of partiality.
Relators’ counsel filed a motion for protective order, in which counsel
asserted, among other things, that (1) the AAA’s rejection of the Scatena defendants’
partiality theories precludes their reconsideration by the trial court and renders their
discovery requests irrelevant; (2) the Scatena defendants’ partiality theories are
legally invalid, and their discovery requests are therefore immaterial; and (3) the
Scatena defendants have not provided clear evidence of impropriety, which “is
required to conduct post-arbitration discovery[.]” In response to the motion for
protective order, the Scatena defendants asserted that each of their requests seek
discovery regarding the undisclosed relationships between Weiss and his sons with
relators’ firm, “which infected the arbitration process.” They also argued that
relators’ law firm “did not disclose that Marshal Hoda would be involved in this
proceeding. In fact, . . . they did not involve Mr. Hoda in this case until April 2019,
once the Arbitrator’s appointment was inevitable.”
On June 3, 2020, the trial court conducted a hearing on various matters,
including the motion for protection. Relators’ counsel argued at the hearing that he
sought “to quash the discovery that has been issued across the board to Gibbs &
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Bruns, to the arbitrator Ted Weiss, to the Frizzell firm, King & Spalding, Jim Weiss,
David Weiss, and Marshal Hoda for a deposition.” Relators’ counsel asserted at the
hearing that the requested discovery is legally irrelevant and “therefore,
impermissible and/or unavailable.” According to relators’ counsel, ARC’s ruling is
dispositive because the Scatena defendants “do not attack the partiality of the five
independent ARC officials, which is a predicate.”
During the hearing, the following colloquy occurred between the trial judge
and relators’ counsel:
[TRIAL COURT]: Your position is really they can’t get there
from here. It matters not how much discovery they do. As a matter of
law, these relationships will be insufficient and, consequently, there is
no need to belabor the point. It makes the discovery irrelevant.
But what if there is enough there to sort of create some concern,
some suspicion, and the discovery might yield something more? Does
that fit within those rare cases? . . . What . . . does it take to have that
clear indication of evident partiality to open the door to discovery?
[RELATORS’ COUNSEL]: It’s certainly not what you see here.
. . . And . . . the case law that you’ve seen, it says on the merits, here is
how little discretion we have to look at anything on the merits,
including wrong on the law, wrong on the facts, decided it wrong[,] . .
. applied the law wrong. Those same rules apply there, except you can’t
even review the ARC. It operates as a separate and independent
tribunal, and the only way you get to second-guess it is you’ve got to
prove . . . there is something wrong, from a partiality basis[,] there as
well.
The Scatena defendants’ counsel argued that the parties agreed to arbitrate with the
AAA, but “[t]here is no agreement to abide by the ARC decision at all.” Relators’
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counsel responded that AAA rules 18(a) through (c) govern, and relators’ counsel
also asserted that no court “has ever ordered post-arbitration discovery on a law
school overlap theory or vicarious partiality theory.”
The trial judge stated as follows during the hearing:
[I]f what we’re focused on are non-disclosures and . . . what this
discovery is, in my view, is a way to take the next step, to say we know
that this was not disclosed. We now know this relationship exists.
So let’s see what that relationship really looks like when we
examine it under a microscope to see if this . . . non-disclosure is
heinous. There is . . . money going back and forth between these firms.
There’s communications between Mr. Hoda and Mr. Weiss. I’m not
saying that. It’s a hypothetical. But . . . that’s kind of the way that this
discovery is going, is to see if once you examine the non-disclosed
thing, . . . it yields evidence of wrongdoing, essentially. Maybe even
innocent wrongdoing[.]
On June 4, 2020, the trial judge signed a protective order that denied the Scatena
defendants’ subpoena and notices of intent to take deposition by written questions
of (1) arbitrator Theodore Weiss and the Weiss law firm, (2) the law firm of
Reynolds Frizzell, (3) Jim Weiss, (4) David Weiss, (5) Marshal Hoda, and (6) Gibbs
& Bruns, but ordered the oral deposition of Marshal Hoda on June 11, 2020. The
order provided that Hoda’s deposition must not exceed two hours in length and
would be “limited in scope to inquiries pertinent to the facts alleged in the Motion
to Vacate the Arbitration Award.”
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Relators filed a petition for writ of mandamus and a motion for emergency
relief, and this Court entered an order staying all proceedings. In their petition for
writ of mandamus, relators argue that (1) the trial court abused its discretion by
ordering the live deposition of a party’s trial counsel to address a non-viable
partiality theory; (2) a party is bound by the ARC’s conclusive rejection of theories
of evident partiality when the party does not challenge the ARC’s decision; (3) the
trial court abused its discretion by ordering a post-arbitration deposition of a second-
year associate on relators’ trial team in the absence of evidence that the arbitrator
acted improperly; and (4) the trial court abused its discretion by delaying considering
relators’ application to confirm the final award by two months to permit post-
arbitration discovery regarding theories of evident partiality.
ANALYSIS
Mandamus will issue to correct a clear abuse of discretion when there is no
other adequate remedy at law. In re Alcatel USA, Inc., 11 S.W.3d 173, 175 (Tex.
2000 (orig. proceeding). A trial court abuses its discretion when its ruling is “‘so
arbitrary and unreasonable as to amount to a clear and prejudicial error of law.’” In
re CSX Corp., 124 S.W.3d 149, 151 (Tex. 2003) (orig. proceeding) (quoting CSR
Ltd. v. Link, 925 S.W.2d 591, 596 (Tex. 1996)); see also Downer v. Aquamarine
Operators, Inc., 701 S.W.2d 238, 241-42 (Tex. 1985). A trial court has no discretion
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in determining what the law is or applying the law to the facts. Walker v. Packer,
827 S.W.2d 833, 840 (Tex. 1992); see Thomas James Assocs., Inc. v. Owens, 1
S.W.3d 315, 322 (Tex. App.—Dallas 1999, no pet.) (holding that, with respect to
discovery regarding evident partiality of an arbitrator, it is within the trial court’s
sound discretion to to grant or deny a motion for continuance).
An arbitrator’s “[e]vident partiality is established by the nondisclosure of
‘facts which might, to an objective observer, create a reasonable impression of the
arbitrator’s partiality’, regardless of whether the nondisclosed information
necessarily shows partiality or bias.” Forest Oil Corp. v. El Rucio Land and Cattle
Co., Inc., 518 S.W.3d 422, 431 (Tex. 2017) (quoting Tenaska Energy, Inc. v.
Ponderosa Pine Energy, LLC, 437 S.W.3d 518, 524 (Tex. 2014)). “However, if an
objective observer could not believe the undisclosed information might create a
reasonable impression of partiality, the information is trivial[,] and the arbitrator did
not exhibit partiality by failing to disclose it.” Amoco D.T. Co. v. Occidental
Petroleum Corp., 343 S.W.3d 837, 844 (Tex. App.—Houston [14th Dist.] 2011, pet.
denied). Although an arbitrator should err in favor of disclosure, he is not required
to disclose trivial matters. Burlington N. RR. Co. v. TUCO, Inc., 960 S.W.2d 629,
637 (Tex. 1997). An arbitrator is only required to disclose material facts, and the
consequences of the arbitrator’s nondisclosure should be directly tied to the
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materiality of the unrevealed information. Sebastian v. Wilkerson, No. 09-18-00223-
CV, 2019 WL 470087, at *3 (Tex. App.—Beaumont Feb. 7, 2019, no pet.). A
familial or close social relationship might reasonably affect the arbitrator’s
impartiality, and a party should have access to such information. Id. An arbitrator’s
alleged partiality “must be direct, definite, and capable of demonstration rather than
remote, uncertain, and speculative.” Id.
The Scatena defendants argue that the “uncontradicted evidence” showed that
Weiss’s son and one of relator’s attorneys “are friends and teammates;” Weiss
“engaged in conversation(s) with his son about the pending arbitration and the son’s
relationship with Relators’ attorney . . .;” and “[n]one of this was disclosed until after
the Final Hearing in the Arbitration.” We disagree. Rather, the evidence merely
demonstrates that Weiss’s son and Hoda are social acquaintances who played a few
games together as members of a recreational basketball team; Weiss’s son and Hoda
conversed enough to ascertain that Weiss was serving as arbitrator, and they agreed
not to discuss the case; and Weiss and relators’ lead attorney, Gibbs, attended the
same law school one year apart decades ago, and both served on Law Review. We
conclude that such connections are distant, trivial, and attenuated, and they are
immaterial because they would not create in an objective observer a reasonable
impression of the arbitrator’s partiality. See Forest Oil Corp., 518 S.W.3d at 431;
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TUCO, Inc., 960 S.W.2d at 637; Sebastian, 2019 WL 470087, at *2-4 (concluding
that a party’s attorney and the arbitrator’s status as friends on Facebook, membership
in the same local bar association, and a campaign contribution from the arbitrator to
a party’s attorney did not create bias or the appearance of impropriety as to
arbitrator).
Because the complained-of connections between (1) Weiss and Gibbs and (2)
Weiss’s son and Hoda are trivial and immaterial, we conclude that Weiss was not
required to disclose them, and the trial court abused its discretion by continuing the
case and permitting a deposition of Hoda. See Forest Oil Corp., 518 S.W.3d at 431;
TUCO, Inc., 960 S.W.2d at 637; Sebastian, 2019 WL 470087, at *2-4. Moreover,
because we have concluded that the information was trivial and Weiss was not
required to disclose it, we need not address relators’ complaints regarding the alleged
conclusiveness of the ARC’s ruling, as it would not result in greater relief. See Tex.
R. App. P. 47.1.
We conditionally grant the petition for writ of mandamus and direct the trial
court to vacate its orders of April 20, 2020, and June 4, 2020, granting a continuance
and ordering the deposition of Hoda, and we will issue the writ only if the trial court
does not vacate its orders.
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PETITION CONDITIONALLY GRANTED.
PER CURIAM
Submitted on June 22, 2020
Opinion Delivered December 10, 2020
Before McKeithen, C.J., Horton and Johnson, JJ.
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