West of England Ship Owners Mut. Ins. Ass'n (Luxembourg) v. American Marine Corp.

UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
_____________________

No. 92-3244
_____________________

WEST OF ENGLAND SHIP OWNERS MUTUAL
INSURANCE ASSOCIATION (LUXEMBOURG),

Plaintiff-Appellee,

VERSUS

AMERICAN MARINE CORPORATION, ET AL.,

Defendants-Appellants.

___________________________________________________

Appeal from the United States District Court
for the Eastern District of Louisiana
___________________________________________________

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____________________

No. 92-3724
____________________

IN RE: AMERICAN MARINE CORPORATION, AMERICAN
MARINE HOLDING COMPANY, OIL TRANSPORT
COMPANY, INC., LOUISIANA MATERIALS
CO., INC., CAJUN CRANE COMPANY,
AGGREGATE BARGES, INC., BAYOU FLEET,
INC., FRERE COMPANY, MODERN BARGE
COMPANY, LESLIE B. DURANT, GRAND
MARINE SENECA BARGE COMPANY, INC.,
OISEAU BROTHERS AUDUBON COMPANY,
DUROW CORPORATION, DUMUR CORPORATION
and NOE BARGE COMPANY,

Petitioners.

____________________________________________________

Petition for Writ of Mandamus to the United States
District Court for the Eastern District of Louisiana
_____________________________________________________

(January 6, 1993)
Before JONES and BARKSDALE, Circuit Judges, and JUSTICE,1 District
Judge.

BARKSDALE, Circuit Judge:

As in McDermott Int'l v. Underwriter's at Lloyds, ___ F.2d

____ (5th Cir. _____, 1992), decided contemporaneously with this

case, the principal issue at hand is the appealability vel non of

an order compelling arbitration. American Marine Corporation and

others (collectively, "Oil Transport") appeal from district court

orders compelling arbitration of a dispute with West of England

Ship Owners Mutual Insurance Association (Luxembourg)

("Association"), pursuant to the Convention on the Recognition and

Enforcement of Foreign Arbitral Awards ("Convention"), 9 U.S.C. §

201 et seq., and staying litigation pending arbitration. In the

alternative, Oil Transport seeks a writ of mandamus. We hold that

the arbitration orders are interlocutory, not final. Because § 16

of the Federal Arbitration Act ("FAA"), 9 U.S.C. § 1 et seq.,

provides that such orders are not appealable, and because this case

does not warrant mandamus, we DISMISS the appeal and DENY the writ.

I.

From 1986 to 1990, Oil Transport entered the Association, a

foreign insurance association, to insure its vessels. Participants

in the Association are governed by its rules, one of which requires

arbitration in London of all disputes.2 A dispute arose when the

1
District Judge for the Eastern District of Texas, sitting by
designation.
2
Rule 62 ("Arbitration") requires arbitration of "any
difference or dispute ... arising out of any contract between the
Member ... and the Association as to the rights or obligations of

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Association charged that Oil Transport had not timely paid calls

(premiums).

The Association notified Oil Transport in July 1991 that it

wished to arbitrate the dispute. Instead, Oil Transport filed suit

in Louisiana state court against the Association and three related

parties, asserting claims under Louisiana law, and seeking

declaratory and injunctive relief against arbitration. The

Association then sued in federal district court to compel

arbitration, and removed the state action to that court. In

October 1991, the district court consolidated the two actions.

Oil Transport filed a number of motions, seeking to remand the

state case, vacate the consolidation, dismiss the Association's

complaint for lack of jurisdiction, and enjoin the Association from

pursuing proceedings it had filed in England.3 The Association

moved to compel arbitration pursuant to the Convention. In

February 1992, the district court denied Oil Transport's motions,

issued an order compelling arbitration, and stayed the proceeding

as to all defendants, including those not subject to the

arbitration agreement.

II.

For review of the arbitration orders, Oil Transport advances

three alternative bases for our jurisdiction.4 As hereinafter

the Association or the Member ... or as to any other matter
whatsoever".
3
In November 1991, the Association had commenced an action in
London to appoint an arbitrator.
4
Permissive 28 U.S.C. § 1292(b) jurisdiction is not asserted.

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discussed, we lack jurisdiction; therefore, we do not reach the

merits of the district court's ruling.5

A.

First, Oil Transport contends that the orders are appealable

under § 16(a) of the FAA, which allows appeals, inter alia, from "a

final decision with respect to an arbitration". 9 U.S.C. §

16(a)(3). It asserts that the orders are final in the context of

the Association's district court action to compel arbitration, as

originally filed, because they dispose of the only issue presented

in that action -- arbitrability.6

The Association responds that the orders are interlocutory,

not final, because the consolidated claims that are pending present

additional unresolved issues. It asserts that appeal is therefore

barred by § 16(b) of the FAA, which applies to interlocutory orders

compelling arbitration and staying litigation in cases subject to

the FAA or the Convention. See 9 U.S.C. § 16(b); McDermott Int'l

v. Underwriters at Lloyds, ___ F.2d ___ (5th Cir. _____, 1992).

In McDermott, we held that where consolidation of an

independent proceeding to compel arbitration with one or more

5
One of those issues is the interplay between § 16 of the FAA,
discussed infra, and the McCarran-Ferguson Act, 15 U.S.C. § 1101,
et seq. (regulation of the business of insurance for the States).
See 15 U.S.C. § 1012(b). Pursuant to this authority, Louisiana has
prohibited arbitration clauses in insurance policies. See La. Rev.
Stat. 22:629; Doucet v. Dental Health Plans Management Corp., 412
So.2d 1383, 1384 (La. 1982).
6
Oil Transport's notice of appeal references only the
Association's arbitration action, and does not include the removed
state action consolidated with it. Obviously, this has no effect
on whether the arbitration order is appealable.

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actions rendered the cases a single judicial unit, orders

compelling arbitration and staying litigation were considered

interlocutory, not final, for § 16 purposes. The consolidation

orders in this case are identical to those we addressed in

McDermott; we find it controlling.7 Accordingly, the orders were

interlocutory, and appeal is barred by § 16(b). See id.

B.

Second, Oil Transport attempts to invoke jurisdiction under

the collateral order doctrine. (That doctrine is discussed in note

9, infra). This court, however, has rejected application of that

doctrine in cases such as this. See Turboff v. Merrill Lynch,

Pierce, Fenner & Smith, Inc., 867 F.2d 1518, 1520 n.5 (5th Cir.

1989); Jolley v. Paine Webber Jackson & Curtis, Inc., 864 F.2d 402,

404 (5th Cir.), supplemented, 867 F.2d 891 (5th Cir. 1989);

Rauscher Pierce Refsnes, Inc. v. Birenbaum, 860 F.2d 169, 171-72

(5th Cir. 1988).8

C.

Finally, Oil Transport contends that this court may review the

district court's decision under an application for a writ of

7
Here, as in McDermott, the cases were broadly consolidated
"for disposition" because they "[grew] out of the same factual
situation".
8
It may well be that, because § 16(b) expressly bars appeal,
the collateral order doctrine would not apply even if its
requirements were satisfied; the doctrine falls under § 1291
jurisprudence, while § 16 jurisdiction does not. However, we need
not consider this question.

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mandamus. For the reasons stated in McDermott, ___ F.2d at ___,

this case does not justify that extraordinary remedy.

III.

We find no merit in the other issues raised by Oil Transport

touching on jurisdiction.9 For the foregoing reasons, the appeal

is DISMISSED, and the application for a writ of mandamus is DENIED.

9
First, because there has been no final order in the case, we
cannot address Oil Transport's separate challenge to the district
court's interlocutory order denying its motion to dismiss for lack
of jurisdiction. See 28 U.S.C. § 1291. Because the Association
failed to do so, we address this jurisdictional point sua sponte.
See England v. Federal Deposit Insurance Corp., 975 F.2d 1168, 1171
(5th Cir. 1992).

Furthermore, the denial does not place this case within that
"very narrow class of cases" in which interlocutory appeal is
permissible under the collateral order doctrine, because it is not
"effectively unreviewable on appeal from a final judgment". United
States v. Hashagen, 716 F.2d 1454, 1454-55 (5th Cir. 1983) (holding
denial of motion to dismiss indictment for lack of jurisdiction in
the district court not reviewable under § 1291); see also Louisiana
Ice Cream Distributors, Inc. v. Carvel Corp., 821 F.2d 1031, 1032-
33 (5th Cir. 1987) (holding denial of motion to dismiss for
improper venue not reviewable under § 1291).

Likewise, Oil Transport asserts that the Association's federal
action should be dismissed because it should have been brought as
a compulsory counterclaim in state court. Oil Transport devotes
only two paragraphs to the argument in support of this contention,
and we find its sparse legal authority unpersuasive. In any event,
this issue was not presented to the district court; and, no
authority need be cited for our not addressing it on appeal for the
first time.

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