Christopher Wanken v. John Wanken , 451 F. App'x 319 ( 2011 )

Case: 11-10219 Document: 00511617501 Page: 1 Date Filed: 09/29/2011
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT United States Court of Appeals
Fifth Circuit
FILED
September 29, 2011
No. 11-10219
Summary Calendar Lyle W. Cayce
Clerk
CHRISTOPHER MICHAEL WANKEN,
Plaintiff-Appellant,
versus
JOHN DWIGHT WANKEN;
RAYMOND JAMES FINANCIAL SERVICES, INC.,
Defendants-Appellees.
Appeal from the United States District Court
for the Northern District of Texas
No. 3:10-CV-556
Before REAVLEY, SMITH, and PRADO, Circuit Judges.
JERRY E. SMITH, Circuit Judge:*
Christopher Wanken (“Wanken”) appeals the denial of his motion to vacate
*
Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH CIR.
R. 47.5.4.
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No. 11-10219
an arbitration award and the grant of defendants’ motions to confirm the award.
Finding no error, we affirm.
I.
Wanken was terminated from his employment as a registered sales asso-
ciate at Beacon Financial Advisors, a firm owned by his father, John Wanken,
and operated as an independent branch office of Raymond James Financial Ser-
vices, Inc. (“Raymond James”). Wanken filed for arbitration with the Financial
Industry Regulatory Authority, claiming that he was a partner in Beacon Finan-
cial and accordingly deserved additional compensation as a result of his wrongful
termination. He also said that John Wanken and Raymond James had defamed
him by listing, on a publicly available document, “Job Performance” as the basis
for his termination. John Wanken counterclaimed, alleging that the arbitration
was filed to harass him.
After extensive discovery and argument, the arbitration panel rejected the
majority of Wanken’s claims but granted him $1,200 in costs from Raymond
James and ordered that the basis for his termination be changed to “no-fault.”
The panel also rejected all of John Wanken’s counterclaims and assigned the
costs to John Wanken and Raymond James.
Wanken sued under 9 U.S.C. § 10(a) to vacate and modify the arbitration
award, claiming that (1) the award was procured by fraud; (2) the arbitration
panel did not allow him to complete his discovery requests; (3) the panel failed
to enforce its discovery orders; (4) the panel refused to consider material evi-
dence; (5) the panel was improperly biased; (6) the panel exceeded and improp-
erly exercised its powers; and (7) John Wanken, Raymond James, and their
attorneys engaged in fraud and misconduct in the arbitration proceedings.
John Wanken and Raymond James filed motions to dismiss, which the
magistrate judge recommended be treated as motions to confirm the arbitration
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No. 11-10219
award and be granted. Wanken filed objections to the recommendation and an
amended motion to vacate. The district court, after de novo review, accepted the
recommendation and confirmed the award.
II.
We review the confirmation of an arbitration award de novo, using the
same standards as did the district court. See Wartsila Finland Oy v. Duke Capi-
tal, LLC, 518 F.3d 287, 291 (5th Cir. 2008) (citation omitted). The review of an
award is “exceedingly deferential.” Brabham v. A.G. Edwards & Sons, Inc., 376
F.3d 377, 380 (5th Cir. 2004). We may vacate an award only
(1) where the award was procured by corruption, fraud, or undue
means;
(2) where there was evident partiality or corruption in the arbitra-
tors, or either of them;
(3) where the arbitrators were guilty of misconduct in refusing to
postpone the hearing, upon sufficient cause shown, or in refusing to
hear evidence pertinent and material to the controversy; or of any
other misbehavior by which the rights of any party have been preju-
diced; or
(4) where the arbitrators exceeded their powers, or so imperfectly
executed them that a mutual, final, and definite award upon the
subject matter submitted was not made.
9 U.S.C. § 10(a).1 The burden of proof is on the party seeking to vacate the
award, and any doubts or uncertainties must be resolved in favor of upholding
it. Brabham, 376 F.3d at 385 n.9 (citations omitted).
Wanken argues that we should instead review the district court’s order
under the motion-to-dismiss standard. That is incorrect; the court plainly
treated the relevant motions as motions to confirm the arbitration award, exem-
1
See also Citigroup Global Markets, Inc. v. Bacon, 562 F.3d 349, 358 (5th Cir. 2009)
(stating that the grounds for vacating an arbitration award are restricted to those set forth in
the Federal Arbitration Act, specifically in 9 U.S.C. § 10).
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plified by the fact that the court considered all the evidence in the record before
confirming the award.
III.
Wanken’s argument that the arbitration award is not supported by the evi-
dence is irrelevant. We have no authority to review the merits of the award; our
inquiry is limited to determining whether any of the statutory conditions for
vacating it have been met.2 On that score, Wanken has not provided sufficient
evidence to satisfy any of those conditions.
A.
Wanken contends that the award was procured by fraud. Specifically, he
argues that John Wanken gave fraudulent testimony during the arbitration
proceedings and concealed documents to deny him the opportunity to present his
claims fully to the panel. Wanken also contends that John Wanken, Raymond
James, and their attorneys generally engaged in fraud and misconduct during
the proceedings. None of these arguments is supported by the record.
Wanken claims that John Wanken gave fraudulent testimony by taking
a position in the arbitration proceeding that were inconsistent with those taken
in proceedings before the Texas Workforce Commission—the inconsistent posi-
tion being whether Wanken was an employee or independent contractor at Bea-
con Financial. Even assuming, however, that John Wanken did take inconsis-
tent positions—the evidence of which is nothing more than Wanken’s assertions
—this particular issue had no bearing on the arbitration proceedings. During
arbitration, the issue was whether Wanken was a partner at Beacon Financial.
John Wanken said he was not, and the arbitration panel agreed. Whether Wan-
2
See Kergosien v. Ocean Energy, Inc., 390 F.3d 346, 357 (5th Cir. 2004), overruled on
other grounds by Citigroup Global Markets Inc. v. Bacon, 562 F.3d 349 (5th Cir. 2009).
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ken was an employee or independent contractor is not relevant to whether he
was a partner—and John Wanken has consistently maintained that Wanken
was not a partner at Beacon Financial. Moreover, we cannot vacate an award
merely because the arbitrators chose to credit one witness’s testimony over
another’s.
Wanken provides no support in the record, beyond his conclusional allega-
tions, that John Wanken has concealed documents. He also provides no credible
evidence supporting his vague allegation that John Wanken, Raymond James,
and their attorneys engaged in fraud and misconduct in the arbitration. Accord-
ingly, Wanken’s argument that the award should be vacated for fraud fails.
B.
Wanken maintains that the award should be vacated because the panel
did not allow him to complete his discovery requests, failed to enforce its dis-
covery orders, and did not consider material evidence. The record does not sup-
port any of those contentions.
The defendants produced over 6000 pages of documents in response to over
250 discovery requests. The panel, after conducting extensive hearings to
resolve discovery issues, ordered the production of additional documents. The
panel did not, however, order the production of all the documents Wanken
requested, on the grounds that the requests were cumbersome and that some of
the requests were irrelevant or not critical to the claims at issue. The panel’s
decision on that score was eminently reasonable and does not amount to “misbe-
havior” or refusal to “hear evidence pertinent and material to the controversy.”
Nor is it accurate to characterize the panel’s decision not to sanction John
Wanken or Raymond James as a failure to enforce its discovery orders—the deci-
sion to sanction is discretionary, and Wanken has not shown any evidence to
suggest that the panel’s exercise of that discretion was in error. Similarly, there
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is no evidence in the record to support Wanken’s claim that the panel failed to
consider material evidence in rendering its decision.
C.
Wanken contends that the arbitration panel was improperly biased
against him. He does not, however, submit any evidence—beyond the fact that
the panel did not grant him the relief he sought—supporting that allegation, nor
is there any in the record.
D.
Wanken claims the panel exceeded and improperly exercised its powers.
Specifically, he asserts that it (1) failed to enforce its discovery orders; (2) issued
contradictory orders regarding witnesses; (3) refused to reconsider a discovery
ruling; (4) did not inform him he was entitled to a continuance; (5) issued a “gag”
order that prevented him from communicating with the media; and (6) made an
“ambiguous and contradictory” award.
We have essentially addressed arguments (1), (2), (3), and (6), above. As
to the others, Wanken offers no explanation as to how those occurrences violate
the Federal Arbitration Act. Even assuming, arguendo, that the arguments
have factual merit, they do not amount to an excessive or improper exercise of
the panel’s powers.
IV.
Wanken avers that the district court failed to consider his amended motion
to vacate. That claim has no merit. The court explicitly stated that, “even con-
sidering plaintiff's amended pleadings, plaintiff has failed to establish any
grounds for vacating or modifying the arbitration award.” (Emphasis added.)
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V.
Wanken maintains that he was entitled to notice before the magistrate
judge recommended converting the motions to dismiss to motions to confirm the
arbitration award. Even assuming, arguendo, that notice was required and not
given before the magistrate judge made the recommendation, Wanken was given
a chance to object—an opportunity he used—before the district court conducted
a de novo review of the motions. Accordingly, Wanken was provided more than
sufficient notice that the motions to dismiss could be treated as motions to con-
firm.
AFFIRMED.
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