Skip to content
  • CAREERS
  • CONTACT US
Search
Close this search box.
anthony ostlund logo
  • PEOPLE
  • LITIGATION
    • APPEALS
    • COMPLEX COMMERCIAL LITIGATION
    • EMPLOYMENT LITIGATION
    • FRAUD AND FIDUCIARY DUTY
    • FINANCIAL LITIGATION
    • OWNER/SHAREHOLDER DISPUTES
    • PLAINTIFF CONTINGENCY CASES
    • PROFESSIONAL MALPRACTICE
    • REAL ESTATE LITIGATION
    • TRUSTS AND ESTATES LAW
  • SUCCESSES
  • NEWS
  • ABOUT
  • FEE ARRANGEMENTS
Menu
  • PEOPLE
  • LITIGATION
    • APPEALS
    • COMPLEX COMMERCIAL LITIGATION
    • EMPLOYMENT LITIGATION
    • FRAUD AND FIDUCIARY DUTY
    • FINANCIAL LITIGATION
    • OWNER/SHAREHOLDER DISPUTES
    • PLAINTIFF CONTINGENCY CASES
    • PROFESSIONAL MALPRACTICE
    • REAL ESTATE LITIGATION
    • TRUSTS AND ESTATES LAW
  • SUCCESSES
  • NEWS
  • ABOUT
  • FEE ARRANGEMENTS

What Gets Decided First: Motion to Compel Arbitration or Motion to Dismiss?

  • December 17, 2018
December 17, 2018
Minnesota Lawyer – Partner Content
Author: Peter J. McElligott

When a party moves to dismiss for failure to state a claim and compel arbitration at the same time, what gets decided first? That was the central question in a recent Minnesota Court of Appeals decision issued on November 26, 2018. In Rodgers v. Silva, the Court of Appeals concluded that under Minnesota Statute § 572B.07(a), the district court must consider and decide a motion to compel arbitration before deciding a motion to dismiss. – N.W.2d –, 2018 WL 6165497 (Minn. Ct. App. Nov. 26, 2018).

Fighting Off the Court/Field

After playing basketball for the Northern Illinois Huskies, Leon Rodgers began a career playing professionally overseas in Germany, France, Netherlands, China, and Puerto Rico. In 2012, Rodgers’ performance led him to Venezuela where he began playing for a Venezuelan professional team called Marinos. The owner of Marinos at the time was former Minnesota Twins pitcher and Venezuelan native, Carlos Silva.
After playing for Marinos for two years, Rodgers signed an employment agreement to play for the team for another two seasons with a team option for a third season. Rodgers alleged that Marinos failed to pay his full salary under that employment agreement. In 2017, Rodgers sued Silva in Hennepin County claiming breach of a personal guaranty and promissory estoppel based on allegations that Silva personally promised to pay Rodgers if Marinos failed to pay his salary. Indeed, Rodgers alleges Silva paid him $70,000 in cash to compensate him for money that Marinos owed to Rodgers.
In response to the complaint, Silva moved to dismiss the complaint under Minnesota Rule of Civil Procedure 12.02(e) for failure to state a claim. Silva simultaneously moved to compel arbitration because Rodgers’ employment agreement with Marinos contained an arbitration clause requiring any dispute arising from or related to the agreement to be submitted to the FIBA Arbitral Tribunal in Geneva, Switzerland. The district court granted Silva’s motion to dismiss on the grounds that Rodgers did not demonstrate the terms necessary to establish Silva guaranteed to pay the debts of Marinos. Having decided the motion to dismiss, the district court did not rule on Silva’s motion to compel arbitration.

Courts Must Decide a Motion to Compel Arbitration Before a Motion to Dismiss

On appeal, the parties actually agreed the district court erred by failing to decide Silva’s motion to compel arbitration. The Court of Appeals agreed as well. Under Minnesota Statute § 572B.07(a), a court “shall” decide whether an arbitration agreement exists and if the dispute falls within the scope of the agreement. The Court of Appeals reasoned that the district court’s failure to consider and decide the motion to compel arbitration contravened § 572B.07 because the arbitrators must decide the merits of the case if the dispute is governed by an arbitration agreement. The Court of Appeals reversed the district court’s dismissal and remanded to determine if Silva is entitled to compel arbitration even though he was not a signatory to the employment agreement.
Impact on Early Litigation Strategy

The Court of Appeals’ decision, as agreed upon by the parties, is an important decision that can have a big impact on litigation strategy early in cases. Although the outcome may seem obvious, this appears to be the first Minnesota case to directly decide the issue whether a district court must decide a motion to compel arbitration before a motion to dismiss. It is no coincidence that the Court of Appeals decided to publish this opinion.

 

related attorneys

Loading...

Peter J. McElligott

related practice areas

Loading...
AO-logo-initials

90 SOUTH 7TH STREET, SUITE 3600
MINNEAPOLIS, MN 55402
P 612.349.6969       F 612.349.6996

 

© 2021 ANTHONY OSTLUND LOUWAGIE DRESSEN BOYLAN P.A.
ALL RIGHTS RESERVED.

  • 651•312•6500
  • 651•312•6618
  • People
  • Litigation
  • Successes
  • News
  • About
  • Fee Arrangements
  • Careers
  • Contact
  • People
  • Litigation
  • Successes
  • News
  • About
  • Fee Arrangements
  • Careers
  • Contact
  • PEOPLE
  • LITIGATION
    • APPEALS
    • COMPLEX COMMERCIAL LITIGATION
    • EMPLOYMENT LITIGATION
    • FRAUD AND FIDUCIARY DUTY
    • FINANCIAL LITIGATION
    • OWNER/SHAREHOLDER DISPUTES
    • PLAINTIFF CONTINGENCY CASES
    • PROFESSIONAL MALPRACTICE
    • REAL ESTATE LITIGATION
    • TRUSTS AND ESTATES LAW
  • SUCCESSES
  • NEWS
  • ABOUT
  • FEE ARRANGEMENTS
  • PEOPLE
  • LITIGATION
    • APPEALS
    • COMPLEX COMMERCIAL LITIGATION
    • EMPLOYMENT LITIGATION
    • FRAUD AND FIDUCIARY DUTY
    • FINANCIAL LITIGATION
    • OWNER/SHAREHOLDER DISPUTES
    • PLAINTIFF CONTINGENCY CASES
    • PROFESSIONAL MALPRACTICE
    • REAL ESTATE LITIGATION
    • TRUSTS AND ESTATES LAW
  • SUCCESSES
  • NEWS
  • ABOUT
  • FEE ARRANGEMENTS
search
disclaimer
Linkedin
Join Our Email List

© 2021 ANTHONY OSTLUND LOUWAGIE DRESSEN BOYLAN P.A. ALL RIGHTS RESERVED.

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Cookie settingsACCEPT
Privacy & Cookies Policy

Privacy Overview

This website uses cookies to improve your experience while you navigate through the website. Out of these cookies, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website. We also use third-party cookies that help us analyze and understand how you use this website. These cookies will be stored in your browser only with your consent. You also have the option to opt-out of these cookies. But opting out of some of these cookies may have an effect on your browsing experience.
Necessary
Always Enabled
Necessary cookies are absolutely essential for the website to function properly. This category only includes cookies that ensures basic functionalities and security features of the website. These cookies do not store any personal information.
Non-necessary
Any cookies that may not be particularly necessary for the website to function and is used specifically to collect user personal data via analytics, ads, other embedded contents are termed as non-necessary cookies. It is mandatory to procure user consent prior to running these cookies on your website.
SAVE & ACCEPT