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Fifteenth Court Holds Arbitration Delegation Clauses Trump Trial Court Scope Determinations in Multi-Contract Disputes
In consolidated interlocatory appeals from two Business Court divisions, the Fifteenth Court of Appeals held that when parties adopt AAA arbitration rules, trial courts lack authority to determine which claims or related contracts fall within the arbitration's scope—that gateway question is delegated exclusively to the arbitrator. The decision reversed both a trial court's refusal to compel arbitration of a dispute over pledged membership units and another division's order staying an ongoing arbitration, establishing that delegation clauses strip courts of jurisdiction over arbitrability determinations.
Chief Justice Brister
Fifteenth Court Holds Arbitrator Must Decide Scope of Arbitration When Parties Delegate to AAA
In consolidated interlocutory appeals from two Business Court divisions, the Fifteenth Court of Appeals reversed orders that limited and stayed arbitration of disputes between TrueAero's CEO and its former president, holding that when parties delegate arbitrability questions to the AAA, trial courts err by deciding whether claims under related contracts fall within the arbitration's scope. The court affirmed a temporary injunction preserving membership units pending the arbitrator's determination.
Business Court Modification of Temporary Injunction Fails Rule 684 Bond Requirement in Non-Compete Dispute
The Fifteenth Court of Appeals reversed in part a Business Court order modifying a temporary injunction against former ES3 Minerals employees and their competing venture, holding that the injunction bond failed to adequately protect appellants' interests under Rule 684 and that the order lacked adequate specificity regarding enjoined subsidiaries. The court also held that challenges to portions of the injunction imposed by the original district court—but not reviewed or reimposed by the Business Court—were not properly before it on appeal.
Justice Farris