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Schmidt v. Wine

United States District Court, Tenth Circuit

August 5, 2013

RICKY L. SCHMIDT, Plaintiff,
TAYLOR WINE, et al., Defendants.



Before the Court is the “Motion to Compel Arbitration and to Stay Further Proceedings” filed by Defendant Wells Fargo Bank, N.A. (Doc. 15) and supporting Memorandum (Doc. 16). Plaintiff failed to file a response pursuant to D. Kan. Rule 6.1(d)(1) and the time to do so has expired. Defendant’s motion is, therefore, GRANTED as uncontested pursuant to D. Kan. Rule. 7.4. Even so, the Court will address the substantive aspects of Defendant’s motion.


Plaintiff, representing himself pro se, filed his federal court Complaint on June 18, 2013, alleging violations of his Constitutional rights resulting from “actions of defendants creating a probable cause when there was none so as to bring a worthless check charge against Plaintiff.” (Doc. 1, at 2.) Defendant specifically alleges that Defendant Wells Fargo Bank, N.A. (hereinafter “Defendant Bank”) “was negligent in apparently accepting a counterfeit payment order and processing it as if it were a legitimate check and then unlawfully reversing the payment order.” (Id., at 2-3.)

Defendant Bank filed the present motion (Doc. 15) on July 15, 2013. The motion seeks an Order compelling arbitration and staying further proceedings pursuant to the dispute resolution program portion of the “Consumer Account Agreement” (Doc. 16-2) relating to Plaintiff’s checking account with Defendant Bank (hereinafter “the Agreement”).

On July 29, 2013, Defendant Taylor Wine filed a Motion to Dismiss. (Doc. 20.) This motion is currently pending before the District Court.

On July 30, 2013, the District Judge assigned to this case entered an Order (Doc. 22) on Plaintiff’s “Consent Withheld to Proceed Before a Magistrate Judge” (Doc. 10.) Therein, the District Court instructed the undersigned Magistrate Judge to consider “whether to issue an order to show cause whether some or all of plaintiff’s complaint should be dismissed pursuant to 28 U.S.C. § 1915 (e)(2)(B).” (Doc. 22, at 1.) The Order continued that “[i]f the magistrate judge issues an order to show cause, [the District Court] suggests, but does not order, that discovery and other customary preliminary proceedings be held in abeyance pending final outcome of the order to show cause.” (Id., at 2.)

Subsequently, a Motion to Dismiss was filed on behalf of Defendants Brenda Cherry, Brandon Jones, Randy Rogers, and Douglas Witteman. (Doc. 23.) This motion is pending before the District Court. These Defendants contemporaneously filed a Motion to Stay Discovery (Doc. 25), which is pending before the undersigned Magistrate Judge. A Motion to Dismiss was also filed by Defendant Bryan Stert, which is pending before the District Court.[1] (Doc. 26.)


A federal magistrate judge may rule on non-dispositive matters. See 28 U.S.C. § 636(b)(1)(A). The District Courts that have considered the nature of an order to stay proceedings pending arbitration and to compel arbitration have concluded that these are non-dispositive orders. Torrance v. Aames Funding Corp., 242 F.Supp. 2d. 862, 865 (D. Or. 2002); Herko v. Metro. Life Ins. Co., 978 F.Supp. 141, 142 n.1 (W.D.N.Y. 1997); see also Touton, S.A. v. M.V. Rizcun Trader, 30 F.Supp.2d 508, 509 (E.D. Pa. 1998) (staying proceedings pending arbitration is not injunctive relief under 28 U.S.C. § 636(b)(1)(A)).

In Herko, the court discussed the matter in detail and concluded that

§ 9 of the FAA requires that the parties to arbitration must apply to the court for an order confirming an arbitration award, which shall be granted unless the award is vacated, modified or corrected in accordance with 9 U.S.C. §§ 10 and 11. Section 10 provides federal district courts with authority to make an order vacating an arbitration award, while § 11 permits modification of the same. Thus, as enacted, the FAA[2] provides that there is no final exercise of Article III power until after arbitration is complete and the arbitrator's decision is either affirmed, modified, or vacated by the district court judge where the actions remain lodged.

978 F.Supp. at n. 1. The Court, therefore, concludes that a motion to compel arbitration is non-dispositive.

The Tenth Circuit has taken a somewhat different approach concerning § 9 of the FFA, holding that judicial confirmation of an arbitration award is not “required.” In P&P Industries, Inc. v. Sutter Corp., the Tenth Circuit held that “a district court has no power to confirm an arbitration award under § 9 of the FAA unless the parties have agreed, explicitly or implicitly, that any eventual arbitration award shall be subject to judicial ...

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