and Submitted May 8, 2017
from the United States District Court for the District of
Oregon Marco A. Hernandez, District Judge, Presiding D.C. No.
D. Miller (argued), Perkins Coie LLP, Seattle, Washington;
David Bledsoe, Perkins Coie LLP, Portland, Oregon; for
Spencer Stewart (argued), Mario R. Nicholas, Thomas Ardell
Larkin, and Jan D. Sokol, Stewart Sokol & Larkin LLC,
Portland, Oregon, for Defendant-Appellants.
D. O'Malley (argued) and Sara H. Kornblatt, Gibbs Giden
Locher Turner Senet & Wittbrodt LLP, Los Angeles,
California, for Amicus Curiae Abengoa.
Before: Jay S. Bybee and Andrew D. Hurwitz, Circuit Judges,
and Jed S. Rakoff, [*] Senior District Judge.
panel vacated the district court's judgment entering a
preliminary injunction prohibiting sureties from pursuing
claims against Portland General Electric Company
("PGE") in arbitration and denying a mandatory stay
of the judicial proceedings under § 3 of the Federal
Arbitration Act, and remanded for further proceedings; and
dismissed for lack of appellate jurisdiction the
sureties' appeal from the order denying their motion for
a discretionary stay.
appeal involves the interplay of three related contracts: a
Construction Contract entered by PGE and several contracting
companies to build an Oregon power plant; a performance Bond
in which appellants/sureties Liberty Mutual Insurance Company
and Zurich American Insurance Company issued a bond to PGE as
required by the Construction Contract; and a Guaranty of
performance issued to PGE by its parent company, Abengoa S.A.
The Guaranty provided that the parties submit any disputes to
binding arbitration to be conducted by the International
Chamber of Commerce ("ICC") under its procedural
rules and Oregon substantive law.
filed this diversity action against the sureties, alleging
breach of the Bond and bad faith; and PGE sought a
preliminary injunction prohibiting the sureties from
arbitrating their claims against PGE.
panel held that the incorporation of the ICC Rules into an
arbitration agreement constituted clear and unmistakable
evidence of a delegation of gateway issues of arbitrability
to the arbitrator.
panel rejected PGE's contention that the ICC Rules did
not govern the present dispute because the Bond lacked an
arbitration clause. The panel held that the following were
questions of the scope of the arbitration agreement in the
Guaranty, and delegated to the arbitrators: whether Abengoa
properly joined the sureties to the arbitration pursuant to
the Guaranty and the ICC Rules; whether the sureties'
claim against PGE met the Guaranty's test of
"aris[ing] out of or in connection with an agreement
with a subcontractor or [the] Guaranty, " and whether
PGE had therefore agreed to arbitrate its disputes against
the sureties. The panel concluded that the district court
erred in enjoining the sureties from participating in the ICC
arbitration, and preventing the arbitral tribunal from
addressing the scope of the arbitration.