KING, Circuit Judge:
Plaintiff Potenciano L. Aggarao, Jr., a citizen of the Philippines, brought suit against MOL Ship Management Company, Ltd., Nissan Motor Car Carrier Company, Ltd., trading as Nissan Carrier Fleet, and World Car Carriers, Incorporated (collectively, the "defendants"), for damages arising from severe injuries he sustained aboard the M/V Asian Spirit in the Chesapeake Bay near Baltimore.
The devastating injuries suffered by Aggarao that give rise to this civil action occurred while he was employed as an able seaman aboard the Asian Spirit. Prior to his employment thereon, Aggarao had signed several agreements that bear on the resolution of this appeal. The relevant facts are set forth below.
On June 2, 2008, Aggarao entered into a "Philippine Overseas Employment Administration
Id. at 187 (the "Arbitration Clause"). Section 31 includes a choice of law clause, specifying:
Id. (the "Choice of Law Clause"). Additionally, Section 20 of the POEA Terms prescribes, in relevant part, the "liabilities of an employer when the seafarer suffers work-related injury or illness during the term of his contract ... as follows":
Id. at 186 (the "Liability Clause").
For purposes of the POEA Contract, Magsaysay Mitsui, a Philippine crewing company, was the agent of defendant MOL—a Japanese company managing the officers and crew of the Asian Spirit. Defendant World Car, a Liberian company, owned, operated, and manned the Asian Spirit. Aggarao was hired as a crewman of the Asian Spirit, which was chartered by defendant Nissan, a Japanese entity. Under the terms of its charter agreement with World Car, Nissan was responsible for instructing the ship on its destination and cargo.
One day after signing the POEA Contract, on June 3, 2008, Aggarao entered into a "Seafarers Employment Contract" (the "Seafarers Contract") with Magsaysay Mitsui that incorporated the terms of a collective bargaining agreement called the "IBF JSU/AMOSUP-IMMAJ CBA" (the
On August 13, 2008, the Asian Spirit was navigating in the Chesapeake Bay en route to the Port of Baltimore where it was scheduled to load a cargo of motor vehicles. Aggarao was working to raise floor panels in the ship in preparation for receipt of the cargo load. As the crew began raising the floor panels, Aggarao was crushed between a deck lifting machine and a pillar. He was promptly airlifted to the nearby University of Maryland Shock Trauma Center (the "UM Trauma Center"), where he was treated for severe injuries to his spinal column and cord, his chest cavity, and his abdomen. Dr. Thomas M. Scalea performed emergency surgery for "litigation of vessels, bowel resection, and splenectomy." J.A. 533. During the next few weeks, Aggarao endured a barrage of additional surgeries and medical procedures, twelve in all.
On October 15, 2008, Aggarao was discharged from the UM Trauma Center and, on Dr. Scalea's recommendation, transferred within the University of Maryland Medical System ("UMMS") to Kernan Orthopaedics and Rehabilitation for follow-up treatment, including physical and occupational therapy in the spinal cord unit. Aggarao presented to Kernan with "T4 ASIA A paraplegia with complete paralysis" and "absent bowel and bladder control." J.A. 539. Dr. Henry York was Aggarao's physician at Kernan. On November 18, 2008, Dr. York reported that Aggarao had made "excellent progress towards his goals of independent functional mobility" in terms of, inter alia, "bed mobility," and "transfers between his bed and his wheelchair [and] between level surfaces." Id. Dr. York contemplated that Aggarao would receive "further physical therapy" and recommended that he acquire an ultra-lightweight wheelchair, so that he could achieve optimal mobility when he returns to the Philippines. Id. at 539-42.
According to a declaration of the defendants' paralegal, made on June 4, 2010, Dr. York and a physical therapist had agreed, at a meeting eighteen months earlier, on December 4, 2008, that Aggarao "had reached as full a recovery as Kernan Hospital could provide him"; "was able to care for himself [as] he had been taught how to catheterize himself[,] manage his wheelchair[, and] get in and out of a car"; and "was ready for the trip to the Philippines." J.A. 1326. By letter of December 8, 2008, the defendants informed Aggarao that, given the extent of his rehabilitation, the owners and insurers of the Asian Spirit authorized travel arrangements for his return to the Philippines and would not be providing financial assistance to him for further medical care in the United States. Nevertheless, Aggarao declined to be repatriated to the Philippines for fear that he could not receive adequate medical treatment there. He also believed that his aging parents, who live in a remote rural area, would be unable to care for a paraplegic and he would die.
On February 25, 2009, Aggarao was discharged from Kernan and relocated to a nearby Days Inn hotel. Kernan arranged to pay, for seven days only, the costs of his room and board at the hotel, plus a nurse to make regular visits. Meanwhile, the defendants reiterated that the owners, managers, and insurers of the Asian Spirit would honor their obligations under the
J.A. 562.
Forced by financial necessity to leave the Days Inn in April 2009, Aggarao eventually moved in with a Filipino-American friend, who agreed to provide lodging and assist with his medications and personal hygiene for $100 per day.
On June 16, 2009, Aggarao initiated this civil action in the Eastern District of New York. Shortly thereafter, on June 29, 2009, the defendants settled his bills with UMMS for hospitalization and medical treatments, in the aggregate sum of $944,530.99. The defendants then advised Aggarao that they were "ready and willing" to arrange for his repatriation to the Philippines and to "provide further appropriate medical care in that country," but would "have no further responsibility for, and will not pay for, any further medical care" in the United States. J.A. 1356.
In preparation for his abdominal reconstructive surgeries, Aggarao underwent weekly skin expansion procedures between August and October 2009. In the meantime, he applied to UMMS for medical assistance and was examined by Dr. Ana T. Acevedo. In her October 30, 2009 report, Dr. Acevedo concluded that Aggarao would "need appropriate and diligent medical care for the rest of his life," and that he was "unlikely to have the expert medical care that he needs" if he returned to his "small village in the Philippines." J.A. 679.
On November 17, 2009, these proceedings were transferred to the District of Maryland. Shortly thereafter, on January 5, 2010, Dr. Scalea performed the first of two planned abdominal reconstructive surgeries
On January 21, 2010, the defendants moved, inter alia, to dismiss the Complaint for improper venue under Rule 12(b)(3), pursuant to the Arbitration Clause. Aggarao opposed the motion to dismiss, arguing that the Arbitration Clause was not enforceable. Aggarao also served multiple discovery requests on the defendants; however, the parties thereafter agreed that no discovery would be conducted pending the court's disposition of the venue and arbitration issues.
Aggarao was subsequently moved from the homeless shelter to his Filipino-American caretaker's home. He was then examined by Elizabeth Davis, a rehabilitation counselor at Life Care Resources, Inc. Davis's report of February 1, 2010, observed, inter alia, that Aggarao was "at extreme risk for further serious complications including infection and autonomic dysreflexia which is an emergency situation," and would need a "high level of care" to function and to maintain his health. J.A. 727-37. Davis also prepared a Life Care Plan, detailing the treatment and maintenance that Aggarao would require. On February 18, 2010, Dr. Scalea performed another surgical procedure, for a bed sore, at the UM Trauma Center. At that time, Aggarao learned that he would be eligible for Medicaid benefits for emergency care only. On February 24, 2010, he was again discharged from the UM Trauma Center, and transferred for rehabilitation to the UMMS-affiliated University Specialty Hospital. Aggarao was approved for rehabilitation on the possibility that it would be paid through the Medicaid program. On March 11, 2010, UMMS filed a lien against him for more than $91,000 in unpaid medical bills.
Aggarao thereafter retained Dr. Richard P. Bonfiglio, a specialist in rehabilitation, to conduct a medical evaluation and review his medical records. Dr. Bonfiglio's April 19, 2010 report explained that Aggarao "needs extensive, ongoing daily, medical and rehabilitative care [as] delineated in the Life Care Plan developed by Elizabeth Davis, RN." J.A. 930. Bonfiglio also concluded that Aggarao "can best receive this level of care in the United States," and therefore
Id.
Two days later, on April 21, 2010, Aggarao filed a motion in the district court seeking a preliminary injunction, compelling MOL and World Car to, inter alia, provide maintenance and cure for him in the United States, until he could attain maximum medical cure (the "injunction request").
Id. at 1365.
On September 30, 2010, the district court issued its Opinion in this case, ruling that the Arbitration Clause was enforceable, and that Aggarao was equitably estopped from pursuing in federal court his separate claims against World Car and Nissan, which were nonsignatories to the POEA Contract. Hence, the court concluded that the Arbitration Clause "must be enforced" and dismissed Aggarao's claims against MOL, World Car, and Nissan for improper venue. See Aggarao, 741 F.Supp.2d at 743. Without further elaboration, the court denied as moot the defendants' motion for summary judgment and the injunction request.
On October 21, 2010, Aggarao filed a timely notice of appeal. We possess jurisdiction pursuant to 28 U.S.C. § 1291.
We review de novo a district court's determination on arbitrability of a civil action. See United States v. Bankers Ins. Co., 245 F.3d 315, 319 (4th Cir.2001). We also review de novo a district court's dismissal of a complaint for improper venue on the basis of a forum-selection clause. See Sucampo Pharm., Inc. v. Astellas Pharma, Inc., 471 F.3d 544, 550 (4th Cir. 2006).
We review for abuse of discretion a district court's denial of a preliminary injunction. See Dewhurst v. Century Aluminum Co., 649 F.3d 287, 290 (4th Cir. 2011). When a motion for a preliminary injunction is denied as moot, there are "no factual or legal findings for this court to review." Dubuc v. Mich. Bd. of Law Exam'rs, 342 F.3d 610, 620 (6th Cir.2003). Rather, in such cases, we must determine whether the court abused its discretion by failing to exercise it. See James v. Jacobson, 6 F.3d 233, 239 (4th Cir.1993) (explaining that abuse of discretion manifests "in a failure or refusal ... actually to exercise discretion").
In 1958, UNESCO adopted the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the "Convention"). The United States acceded to the Convention in 1970, and Congress implemented it by enacting Chapter 2 of Title 9 of the United States Code ("the Convention Act").
In deciding whether to enforce a foreign arbitration clause implicating the Convention Act, courts have emphasized four jurisdictional factors:
Balen v. Holland Am. Line Inc., 583 F.3d 647, 654-55 (9th Cir.2009) (internal quotation marks omitted). When these jurisdictional prerequisites have been satisfied, a
In addressing the four jurisdictional factors, Aggarao acknowledges that two of them are satisfied. First, the Arbitration Clause provides for arbitration in the Philippines, which is a signatory of the Convention (Factor Two), and, second, he is not a citizen of the United States (Factor Four). Nevertheless, Aggarao contends that jurisdictional Factors One and Three have not been satisfied. More specifically, he maintains that there was never an agreement to arbitrate (Factor One) because the Seafarers Contract and the CBA superseded—or at least modified— the POEA Contract, and thus annulled the Arbitration Clause. Moreover, Aggarao posits that an agreement to arbitrate could not have arisen from a commercial legal relationship (Factor Three) because a seaman's employment contract is exempt from the FAA definition of "commerce."
Notwithstanding the jurisdictional prerequisites, Aggarao asserts that the Arbitration Clause cannot divest the district court of jurisdiction over his Seaman's Wage Act claim and, by extension, his other claims for relief. He also suggests that enforcement of the Arbitration Clause and the Choice of Law Clause would contravene the public policy of this country by forcing him to waive his statutory claims under the Jones Act and the Seaman's Wage Act. Even if he is required to arbitrate his claims against MOL, however, Aggarao insists that he should be able to proceed against World Car and Nissan in the district court, rather than in arbitration in the Philippines, because they are not signatories to the POEA Contract and owed duties to him that are distinct from those owed by MOL. We assess Aggarao's contentions in turn.
First, Aggarao contends that there is no binding arbitration agreement because the Seafarers Contract and the CBA constituted a novation that served to supersede the POEA Contract. A contractual novation has four elements: "(1) [a] previous valid obligation; (2) the agreement of all parties to [a] new contract; (3) the validity of such new contract; and (4) the extinguishment of the old contract by the substitution of the new contract." Holder v. Maaco Enterps., 644 F.2d 310, 312 n. 2 (4th Cir.1981) (applying Maryland law) (internal quotation marks omitted). Aggarao's effort to show a novation with respect to the Arbitration Clause fails on the fourth element.
The Opinion accurately observed that "there is no indication, either expressed or implied, that both parties intended the Seafarers Contract to constitute a novation of the POEA Contract." Aggarao, 741 F.Supp.2d at 739. Neither the Seafarers Contract nor the CBA contains any language extinguishing the POEA Contract. Rather, the CBA anticipates the existence of "an individual Contract of Employment" between the employer (MOL) and the seafarer (Aggarao), e.g., the POEA Contract, yet the CBA specifies that it is to be "deemed ... incorporated into and to contain the terms and conditions of employment." J.A. 193. Moreover, the POEA Contract itself provides that any alterations agreed to by the parties and approved by the POEA "shall be deemed an integral part of the [POEA Terms]." Id. at 184. That provision is applicable because the POEA approved the Seafarers Contract incorporating the CBA. And, the Arbitration Clause contemplates that the parties may be covered by a collective
Alternatively, Aggarao contends that the Seafarers Contract and the CBA at least modified the POEA Contract so as to repeal the Arbitration Clause. As we have explained, however, "[w]hen a party seeking to avoid arbitration contends that the clause providing for arbitration has been superseded by some other agreement, the presumptions favoring arbitrability must be negated expressly or by clear implication." Zandford v. Prudential-Bache Sec., Inc., 112 F.3d 723, 727 (4th Cir.1997) (internal quotation marks omitted). Aggarao maintains that such a "clear implication" is found in Article 28.5 of the CBA, which provides, in pertinent part, that "[a]ny payment [for permanent disability sustained during the course of a seafarer's employment], shall be without prejudice to any claim for compensation made in law." J.A. 205. Aggarao interprets Article 28.5 to authorize actions at law for personal injury claims, which, he asserts, countermands the Arbitration Clause.
Put succinctly, we are unwilling to accept Aggarao's construction as the proper and clear implication of Article 28.5. In construing an arbitration agreement under "common law principles of contract interpretation... due regard must be given to the federal policy favoring arbitration, and ambiguities as to the scope of the arbitration clause itself resolved in favor of arbitration." United States v. Bankers Ins. Co., 245 F.3d 315, 319 (4th Cir.2001) (internal quotation marks and alteration omitted). It is elementary that a contract term must "be construed in connection with the [contract's] other provisions, so that if possible, or so far as is possible, they may all harmonize." Chi. Ry. Equip. Co. v. Merch. Bank, 136 U.S. 268, 281, 10 S.Ct. 999, 34 L.Ed. 349 (1890); see Levin v. Alms & Assocs., Inc., 634 F.3d 260, 267 (4th Cir.2011) (observing that "whether one of two provisions in a contract controls is irrelevant where ... the two provisions can be comfortably read together" (internal quotation marks omitted)). This rule applies to our holistic assessment of the POEA Contract, the Seafarer's Contract, and the incorporated CBA, in that these agreements concern the same subject matter (the terms and conditions of Aggarao's employment) and were executed by the same parties within one day of each other. See Aliron Int'l, Inc. v. Cherokee Nation Indus., Inc., 531 F.3d 863, 868 (D.C.Cir. 2008) (according effect to arbitration clause found in one contract for dispute arising under separate contract because contracts were made by same parties and concerned same subject matter); cf. Cara's Notions, Inc. v. Hallmark Cards, Inc., 140 F.3d 566, 571 (4th Cir. 1998) (construing broad arbitration clause in one contract to encompass dispute originating from another contract that had no arbitration clause).
Read together, the Arbitration Clause and Article 28.5 authorize Aggarao to pursue his legal claims through arbitration. Harmonizing those two provisions in that manner satisfies "two prime interpretive dictates regarding judicial review [—] that all contractual provisions be read to make sense, and that arbitration be favored." See H.C. Lawton, Jr., Inc. v. Truck Drivers, Chauffeurs & Helpers Local Union No. 384, 755 F.2d 324, 329 (3d Cir.1985). Even if the Arbitration Clause and Article 28.5 could not be so harmonized, we agree with the district court that there is, at best, an ambiguity as to how Aggarao "may proceed to recover compensation," since Article 28.5 does not "provide access to a particular court or other forum." See Aggarao, 741 F.Supp.2d at 740. Accordingly, "as a matter of federal
Next, Aggarao contends that the Arbitration Clause is not subject to the Convention Act, which applies only to disputes arising from commercial legal relationships involving foreign countries. See 9 U.S.C. § 202. In this respect, he maintains that the POEA Contract did not create a commercial legal relationship because the FAA is the source of the definition of "commercial," and it exempts from that definition the employment contracts of a seaman. In particular, Aggarao directs us to that part of the FAA defining the term "commerce," providing that "nothing herein contained shall apply to contracts of employment of seamen." 9 U.S.C. § 1 (the "§ 1 exemption"). Aggarao asserts that § 1 defines that which is commercial for all of Title 9, including § 202, which restricts the scope of the Convention Act to commercial legal relationships. Alternatively, he argues that § 208 makes the § 1 exemption applicable to § 202. Otherwise, we should resolve any ambiguity by resorting to legislative history, which, according to Aggarao, plainly shows that the § 1 exemption was meant to apply to § 202.
As the Opinion observed, Aggarao's contentions have been squarely rejected by at least three of our sister circuits, which have held that the § 1 exemption does not apply to the Convention Act. See Aggarao, 741 F.Supp.2d at 741. Section 202 provides, in relevant part, that an agreement falls under the Convention Act if it "aris[es] out of a legal relationship, whether contractual or not, which is considered as commercial, including a transaction, contract, or agreement described in section 2 of [the FAA]." 9 U.S.C. § 202 (emphasis added). Section 2 recognizes as enforceable an arbitration clause "in any maritime transaction or a contract evidencing a transaction involving commerce to settle by arbitration." Id. § 2. As the Supreme Court has observed, "a contract evidencing a transaction involving commerce" includes an employment contract. See Circuit City Stores, Inc. v. Adams, 532 U.S. 105, 113, 121 S.Ct. 1302, 149 L.Ed.2d 234 (2001).
The Fifth and Eleventh Circuits have explained that the reference in § 202 to § 2 does not exclusively limit the definition of "commercial" to the contracts described in § 2, but is illustrative of the types of commercial legal relationships meant to be covered by § 202. See Bautista, 396 F.3d at 1298; Francisco v. Stolt Achievement MT, 293 F.3d 270, 274 (5th Cir.2002). Significantly, § 202 "makes no mention" of the exemption found in § 1. Id. Moreover, as the Ninth Circuit has explained, the § 1 exemption "is neither part of the definition of commerce ... nor a limitation on which relationships are `considered as commercial' [r]ather, it operates as an exemption." Rogers, 547 F.3d at 1155. That is, the exemption "does not state that ... employment contracts are not `considered as commercial'[;] it states that ... even though their employment contracts are considered commercial, the
Nor is the § 1 exemption incorporated by § 208. As the Ninth Circuit observed in Rogers, § 208 "incorporates the provisions of the FAA unless they are `in conflict with' either the Convention Act or the Convention." Id. at 1155. Incorporating the § 1 exemption would create just such a conflict because "[n]either the Convention nor the limiting language ratifying the Convention contemplate any exception for seamen employment contracts or employment contracts in general." See Francisco, 293 F.3d at 274. Instead, Congress limited the applicability of the Convention only to arbitration agreements arising from commercial legal relationships, and, as explained above, the § 1 exemption does not define what is commercial.
Because § 202 is "plain and unambiguous... there is no need for recourse to legislative history." See Van Alstyne v. Elec. Scriptorium, Ltd., 560 F.3d 199, 207 (4th Cir.2009).
Aggarao next contends that, even if the Convention Act's jurisdictional prerequisites are satisfied, the Arbitration Clause cannot divest the district court of jurisdiction because the Seaman's Wage Act entitles him to access a federal court to resolve his claim thereunder. See 46 U.S.C. § 10313(i) (providing federal "courts are available to seamen for enforcement" of wage claims).
The Ninth and Eleventh Circuits have determined that "[t]he Convention Act expressly compels the federal courts to
Next, Aggarao persists in his view that arbitration of his Jones Act and Seaman's Wage Act claims in the Philippines will contravene the public policy of the United States.
Mitsubishi, 473 U.S. at 637 n. 19, 105 S.Ct. 3346. Ten years later, the Court qualified the doctrine, recognizing that a prospective waiver would contravene public policy only when there is "no subsequent opportunity for review" in federal court. See Vimar Seguros y Reaseguros, S.A. v. M/V Sky Reefer, 515 U.S. 528, 540, 115 S.Ct. 2322, 132 L.Ed.2d 462 (1995).
Purporting to follow the Court's mandate in Mitsubishi and Sky Reefer, the Eleventh Circuit opined that an arbitration agreement could be deemed "null and void as a matter of public policy" if it is clear
The Supreme Court has recognized this two-stage approach, adhering to the arbitration-enforcement and award-enforcement stages in both Mitsubishi and Sky Reefer. Confronted in Mitsubishi with the possibility that the law of Switzerland would govern an agreement subject to arbitration in Japan, the Court nevertheless declined "to speculate on this matter at th[at] stage in the proceedings, when Mitsubishi [sought] to enforce the agreement to arbitrate, not to enforce an award." 473 U.S. at 637 n. 19, 105 S.Ct. 3346. Rather, the Court indicated that a federal court would "have the opportunity at the awardenforcement stage to ensure that the legitimate interest in the enforcement of American antitrust laws has been addressed[, reserving] the right to refuse enforcement of an award where [it] would be contrary to the public policy of [the United States]." Id. at 638, 105 S.Ct. 3346 (internal quotation marks omitted).
The Eleventh Circuit's Thomas decision erroneously conflated the two stages of arbitration-related court proceedings, merging the null-and-void and public policy defenses and ruling that the arbitration agreement was "null and void as a matter of public policy." 573 F.3d at 1124 n. 7 (emphasis added). That amalgamation was contrary to Eleventh Circuit precedent, which had previously held that the null and void defense only applies when the arbitration agreement has been "obtained through those limited situations, `such as fraud, mistake, duress, and waiver,' constituting `standard breach-of-contract defenses' that `can be applied neutrally on an international scale.'" Lindo,
Moreover, the problem with applying the public policy defense at the first stage of the arbitration-related court proceedings—the arbitration-enforcement stage—is that the defense "cannot be applied `neutrally on an international scale,' as each nation operates under different statutory laws and pursues different policy concerns." See Lindo, 652 F.3d at 1278. In applying the Convention's provisions, the district courts "must not only observe the strong policy favoring arbitration, but must also foster the adoption of standards which can be uniformly applied on an international scale." I.T.A.D. Assocs., Inc. v. Podar Bros., 636 F.2d 75, 77 (4th Cir. 1981). Consequently, Aggarao is not entitled to interpose his public policy defense, on the basis of the prospective waiver, doctrine until the second stage of the arbitration-related court proceedings—the award-enforcement stage.
Finally, Aggarao contends that, even if he is obliged to arbitrate his claims against MOL, the district court erred in concluding he was equitably estopped from pursuing his claims against World Car and Nissan because they are not signatories to the POEA Contract. Without a doubt, however, "a nonsignatory to an arbitration clause may, in certain situations, compel a signatory to the clause to arbitrate the signatory's claims against the nonsignatory despite the fact that the signatory and nonsignatory lack an agreement to arbitrate." Am. Bankers Ins. Group, Inc. v. Long, 453 F.3d 623, 627 (4th Cir.2006). As Judge Williams there recognized, "[o]ne such situation exists when the signatory is equitably estopped from arguing that a nonsignatory is not a party to the arbitration clause." Id. Most relevant here, the doctrine of equitable estoppel applies "`when the signatory to the contract containing the arbitration clause raises allegations of ... substantially interdependent and concerted misconduct by both the non-signatory and one or more of the signatories to the contract.'" Brantley v. Republic Mortg. Ins. Co., 424 F.3d 392, 396 (4th Cir.2005) (quoting MS Dealer Serv. Corp. v. Franklin, 177 F.3d 942, 947 (11th Cir.1999) (alterations omitted)).
Although Aggarao maintains that MOL, World Car, and Nissan had separate roles in the injuries he suffered, and that each owed him distinct legal duties, his Complaint alleges that each was his "employer," and that it was "within the course and scope of his employment" that he sustained injuries "because of the unsafe and unseaworthy condition of [the Asian Spirit], fault, breach of agreement, violation of law, and negligence of the Defendants." J.A. 20-23, 25 (emphasis added). Indeed, Aggarao essentially alleges the same
Aggarao protests that the foregoing allegations are insufficient for equitable estoppel purposes, because his Complaint does not also allege "pre-arranged, collusive behavior demonstrating that the claims are intimately founded in and intertwined with the [arbitration] agreement at issue." See Donaldson Co., Inc. v. Burroughs Diesel, Inc., 581 F.3d 726, 735 (8th Cir.2009) (internal quotation marks omitted). Although we have not specifically required allegations of collusion, we agree that, at a minimum, there must be allegations of "coordinated behavior between a signatory and a nonsignatory" defendant, id. at 734, and that the claims against both the signatory and nonsignatory defendants must be "based on the same facts," be "inherently inseparable," and "fall within the scope of the arbitration clause," see MS Dealer, 177 F.3d at 947-48 (internal quotation marks omitted).
Aggarao's claims against MOL, World Car, and Nissan allegedly arose from the same "occurrence" or "incident," i.e., the tragic circumstances on the Asian Spirit in August 2008 resulting in his injuries. See J.A. at 27-28. The conduct of MOL, World Car, and Nissan was coordinated by virtue of each defendant's alleged involvement in that incident—instigating and contributing to one another. In the first place, MOL, apparently carrying out the orders of Nissan, directed the seamen of the Asian Spirit to make preparations to load its cargo while the ship was yet in the Chesapeake Bay, instead of in the Port of Baltimore where those tasks could be more safely accomplished. These unsafe conditions were said to be exacerbated by design defects in the Asian Spirit and its deck lifting machine, rendering World Car's ship unseaworthy. MOL, in turn, allegedly provided improper supervision to an inexperienced crew negligently operating the deck lifting machine—a crew that World Car had the responsibility to man. In short, Aggarao's claims against MOL depend, "in some part, upon the nature of tortious acts allegedly committed" by Nissan and World Car, and vice versa. See Brown v. Pac. Life Ins. Co., 462 F.3d 384, 398-99 (5th Cir.2006) (affirming decision compelling plaintiff to arbitrate claims against nonsignatory parent company because
Moreover, Aggarao emphasizes in his claims against MOL, World Car, and Nissan that his injuries occurred while he was acting in the scope of his employment. The POEA Contract sets forth terms and conditions of employment, including obligations to provide a seaworthy vessel, maintenance and cure, and wages. Hence, each of Aggarao's claims against Nissan, World Car, and MOL implicates, in some manner, the POEA Contract. Consequently, each of his claims falls within the scope of the Arbitration Clause. We are thus satisfied—as was the district court— that the doctrine of equitable estoppel applies, and that Aggarao must arbitrate his claims against the signatory MOL as well as those claims alleged against the nonsignatories Nissan and World Car.
Although we affirm the district court's determination that the Arbitration Clause is enforceable, we reject its procedural disposition of the case—i.e., dismissal of the Complaint with prejudice and denial of the injunction request as moot. Contrary to the court's apparent supposition, it was not divested of jurisdiction once it concluded that Aggarao's claims were subject to arbitration in the Philippines. The Supreme Court in Sky Reefer explicitly recognized that a district court could, in foreign arbitration cases, properly retain jurisdiction after referring the parties to arbitration pursuant to the Convention Act. Id. at 540-41, 115 S.Ct. 2322; id. at 542, 115 S.Ct. 2322 (O'Connor, J., concurring) (explaining that "[f]oreign arbitration clauses of the kind presented here do not divest domestic courts of jurisdiction, unlike true foreign forum selection clauses"). Indeed, the Court emphasized that the plaintiff would be ensured a subsequent opportunity at a second arbitration-related court proceeding, the award-enforcement stage, to raise its public policy defense because the district court had retained jurisdiction. Id.
Moreover, we have recognized that, "[w]hen a valid agreement to arbitrate exists between the parties and covers the matter in dispute, the FAA commands the federal courts to stay any ongoing judicial proceedings and to compel arbitration." Hooters of Am., Inc. v. Phillips, 173 F.3d 933, 937 (4th Cir.1999) (citations omitted). Although our Hooters decision addressed a district court's authority to stay proceedings pending arbitration under § 3 of the FAA—which applies specifically to arbitration agreements between citizens of the United States—that provision is equally applicable to actions subject to the Convention Act. As explained above, § 208 of the Convention Act incorporates those provisions of the FAA that are not in conflict with the Convention or the Convention Act. Because neither the Convention nor the Convention Act prohibits the issuance of a stay of proceedings, the authority conferred in § 3 of the FAA is incorporated into the Convention Act. Cf. Rhone Mediterranee Compagnia Francese Di Assicurazioni E Riassicurazoni v. Lauro, 712 F.2d 50, 54-55 (3d Cir.1983) (concluding
Although we have acknowledged that "dismissal is a proper remedy when all of the issues presented in a lawsuit are arbitrable," Choice Hotels Int'l, Inc. v. BSR Tropicana Resort, Inc., 252 F.3d 707, 709-10 (4th Cir.2001), that is not the situation presented here.
As a corollary to the foregoing, the district court was not obliged to deny the injunction request as moot when it deemed Aggarao's claims to be arbitrable. We have recognized that the "hollow-formality" test may be applicable in such circumstances, explaining that,
Merrill Lynch, Pierce, Fenner & Smith v. Bradley, 756 F.2d 1048, 1053-54 (4th Cir. 1985) (quoting Lever Bros. Co. v. Int'l Chem. Workers Union, Local 217, 554 F.2d 115, 123 (4th Cir.1976)). Although our Bradley decision, as well as its Lever Bros. predecessor, addressed disputes subject to the FAA only, a court's authority to entertain an injunction request that passes the hollow-formality test applies to Convention Act cases as well. Again, § 208 of the Convention Act incorporates the FAA provided it does not conflict with the Convention or the Convention Act. As the Fifth Circuit has recognized, "nothing in the Convention or [the Convention Act] limits the inherent authority of a federal court to grant injunctive relief with respect to a party over whom it has jurisdiction." Karaha Bodas Co., L.L.C. v. Perusahaan Pertambangan Minyak Dan Gas Bumi Negara, 335 F.3d 357, 365 (5th Cir.2003); see also Borden, Inc. v. Meiji Milk Prods. Co., Ltd., 919 F.2d 822, 826 (2d Cir.1990) (recognizing that "entertaining an application for a preliminary injunction in aid of
When Aggarao made his injunction request there were genuine issues of material fact regarding whether the defendants had provided adequate maintenance and cure to him and, relatedly, whether he was fit to be repatriated to the Philippines. Aggarao insisted that MOL and World Car had breached their obligations under general maritime law to provide him maintenance and cure "until he reache[d] maximum medical recovery." See Vaughan v. Atkinson, 369 U.S. 527, 531, 82 S.Ct. 997, 8 L.Ed.2d 88 (1962).
The status quo to be preserved by a preliminary injunction, however, is not the circumstances existing at the moment the lawsuit or injunction request was actually filed, but the "last uncontested status between the parties which preceded the controversy." See Stemple v. Bd. of Ed. of Prince George's Cnty., 623 F.2d 893, 898 (4th Cir.1980). "To be sure, it is sometimes necessary to require a party who has recently disturbed the status quo to reverse its actions," but as the Tenth Circuit has explained, "[s]uch an injunction restores, rather than disturbs, the status quo ante." O Centro Espirita Beneficiente Uniao Do Vegetal v. Ashcroft, 389 F.3d 973, 1013 (10th Cir.2004); see United Steelworkers of Am., AFL-CIO v. Textron, Inc., 836 F.2d 6, 10, (1st Cir.1987) (determining that injunction requiring insurance premium payments was not "mandatory" but "prohibitory" because during "last uncontested status" defendant had paid premiums) (Breyer, J.). Hence, the district court is entitled to apply the hollow-formality test to Aggarao's injunction request and determine whether an arbitral award in his favor in the Philippines might be an empty one, if maintenance and cure is not restored in the interim.
The district court is also empowered to assess the second aspect of the injunction request, that Aggarao remain in the United States pending arbitration because he is not fit to be repatriated to the Philippines, or because he will not receive adequate medical care in that country. Obviously, Aggarao cannot be returned to the status quo ante if his repatriation to the Philippines for the arbitration proceedings might result in his demise, or if the lack of adequate medical care there would prejudice his already debilitated condition. Therefore, in evaluating whether the injunction request passes the hollow-formality test, the court should decide whether
The parties have presented conflicting medical opinions on both these questions. On remand—in the absence of an agreement by the parties—the district court should weigh these conflicting opinions and, if warranted, receive supplemental evidence. Cf. Breese v. AWI, Inc., 823 F.2d 100, 104 (5th Cir.1987) (observing that whether seaman "has reached maximum cure ... is a medical question, not a legal one").
Irrespective of the outcome of the injunction request, the court should stay this case pending the arbitration proceedings to ensure that Aggarao will have an opportunity at the award-enforcement stage for judicial review of his public policy defense based on the prospective waiver doctrine. We recognize that the Ninth and Eleventh Circuits have surmised that a plaintiff's access to a federal court in this country should be virtually guaranteed following foreign arbitration proceedings. See Lindo, 652 F.3d at 1279-80; Balen, 583 F.3d at 654.
Pursuant to the foregoing, we affirm the district court's judgment that the Arbitration Clause is enforceable and that Aggarao must arbitrate his claims against the defendants in the Philippines. We nevertheless vacate the dismissal of this case and remand for reinstatement thereof, for assessment of the injunction request, for entry of a stay pending arbitration, and for such other and further proceedings as may be appropriate.
AFFIRMED IN PART, VACATED IN PART, AND REMANDED
Rogers v. Royal Caribbean Cruise Line, 547 F.3d 1148, 1152-53 (9th Cir.2008); accord Bautista v. Star Cruises, 396 F.3d 1289, 1292 n. 2 (11th Cir.2005) (referring to Chapter 1 as "FAA" and to Chapter 2 as the "Convention Act," even though "[c]ourts often refer to the entirety of title 9 as the Federal Arbitration Act"). To avoid confusion, we adopt the same nomenclature as those circuits, referring to Chapter 1 of Title 9 as the "FAA" and to Chapter 2 as the "Convention Act."
S. Comm. on Foreign Relations, Foreign Arbitral Awards, S.Rep. No. 91-702, at 6 (1970). Even if the ambassador believed the § 1 exemption "should apply to the Convention Act, his views as a single State Department official are a relatively unreliable indicator of statutory intent." Bautista, 396 F.3d at 1298; see Francisco, 293 F.3d at 276 (same).
46 U.S.C. § 30104. The Jones Act thereby "incorporates the judicially developed doctrine of liability of the Federal Employers Liability Act," which governs the injury claims of railway workers. See Martin v. Harris, 560 F.3d 210, 216 (4th Cir.2009) (internal quotation marks omitted).