Kaplan v. Divosta Homes, L.P., 2010 U.S. Dist. LEXIS 107454 (M.D. FL Oct. 7, 2010)
In a suit for rescission of a contract for the purchase of a house, fraud, discrimination in the enforcement of covenants and restrictions, and a claim of personal injury, a Florida state court issued an order compelling arbitration of the rescission and fraud claims, but denying arbitration on the discrimination and the personal injury claims. This decision was affirmed by a Florida state appellate court.
The discrimination and personal injury claims proceeded in state court. However, the arbitration process ordered for the rescission and fraud claims had not commenced. The state court judge ruled that he had no jurisdiction over the portion of the case relating to rescission and fraud.
In a subsequent federal action brought to compel the arbitration of the rescission and fraud claims, the parties pointed the finger at one another as to why the arbitration process had not begun despite the orders of the state courts. Although holding that the federal court had subject matter jurisdiction, the federal district court held that the issue of whether arbitration is required has been decided by a final judgment of the state courts. Since the essential elements of issue preclusion under Florida res judicata law were satisfied as to the issue of compelling arbitration under the contract, dismissal of the federal case seeking the same determination was warranted. The federal court noted that, what the parties are actually quarreling about is the enforcement of the state courts’ orders. The federal court held that since the state court has compelled arbitration, there is no basis for a federal court to interfere with its orders or jurisdiction. The federal petition was therefore dismissed.
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Bryan Richmond and Tom Segalla
https://www.goldbergsegalla.com/attorneys/Richmond.html
https://www.goldbergsegalla.com/attorneys/Segalla.html
case provided courtesy of Lexis