Tuesday, July 11, 2006

Second Circuit Rules That Federal Arbitration Act Does Not Authorize Nationwide Service of Process

Per Dynegy Midstream Services v. Trammochem, --- F.3d ----, 2006 WL 1612722 (2d Cir. Jun 13, 2006):

Respondents-appellees are parties to an arbitration in New York. The arbitrators in that dispute issued a subpoena directing petitioner-appellant to produce documents and electronic data. Petitioner chose to ignore the subpoena, and respondents filed a motion to compel compliance in the United States District Court for the Southern District of New York (Baer, J.). The district court granted the motion to compel, over petitioner's objection that the court lacked personal jurisdiction over it. Petitioner filed a timely notice of appeal.

We hold, as an initial matter, that where an order compelling compliance with an arbitrator's subpoena disposes of the entire case, it is a final order for the purposes of appellate jurisdiction. In addition, we hold that the Federal Arbitration Act does not authorize nationwide service of process and therefore the district court lacked personal jurisdiction over appellant. Because we lack personal jurisdiction, we find it unnecessary to address whether the Federal Arbitration Act authorizes the issuance of documents-only subpoenas to third parties.

BNA reported on this case recently in U.S. Law Week (Vol. 74, No. 49, page 1771). BNA subscribers may read the U.S. Law Week report on the case by clicking here.


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