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Second Circuit Affirms Order Compelling Arbitration, Rejects as Waived Arguments Not Made Before Trial Court

The Second Circuit Court of Appeals had no difficulty affirming a district court’s order compelling the executor of an estate to arbitrate his claims based on an arbitration clause contained in an IRA application signed by the deceased.

At oral argument, the executor (an attorney appearing pro se) admitted that he had forfeited any argument that the arbitration provision itself was invalid, and thus was left to rely on the theory that the contract as a whole was invalid. The Second Circuit easily rejected this, noting that the U.S. Supreme Court has held that “unless [a] challenge is to the arbitration clause itself, the issue of the contract’s validity is considered by the arbitrator in the first instance.” Thus, the Court found that the matter should go to arbitration where the arbitrator could decide the question of the contract’s validity.

The executor also argued that the district court erred in even considering the motion to compel due to an “electronic filing error” not specified in the opinion. However, in addition to being waived for not having been raised before the district court, the Court found that this argument lacked all merit because the executor knew about the motion, responded to it, and could not show any prejudice.

Aretakis v. First Financial Equity, Corp., Hilltop Securities, Inc., No. 17-3649 (2d Cir. Dec. 10, 2018)

©2011-2020 Carlton Fields, P.A.


About this Author

Matthew Allen Class Action Antitrust Litigator

Matt Allen has particular emphasis in class action and antitrust litigation, having litigated dozens of class actions last year alone. More broadly, his area of practice is complex litigation, including antitrust law, deceptive trade practice law, insurance litigation, appellate law, and general business disputes.

Matt is board certified by The Florida Bar in Antitrust and Trade Regulation Law.