Boardman v. Pacific Seafood Grp., No. 15-35257 (9th Cir. 2016)
Annotate this CasePlaintiffs, a group of West Coast fishermen, filed suit againt Frank Dulcich, Pacific Seafood, and an Ocean Gold entity, alleging antitrust claims under the Sherman Act, 15 U.S.C. 1-7, and the Clayton Act, 15 U.S.C. 18. Defendants appealed the district court's decision granting a preliminary injunction to enjoin the acquisition and denying the motion to compel arbitration. The court affirmed the district court's order denying the motion to compel arbitration because plaintiffs' claims are not within the scope of the purported arbitration provision in the Resolution Agreement. The court also affirmed the district court's grant of a preliminary injunction where plaintiffs have shown a sufficient likelihood of success on the merits because plaintiffs did not release their claims in a prior settlement, plaintiffs have adequately demonstrated that the proposed transaction could substantially lessen competition, plaintiffs are likely to suffer irreparable harm in the absence of preliminary relief, the balance of the equities tips in plaintiffs' favor, a preliminary injunction is in the public interest, and the preliminary injunction is not overbroad.
Court Description: Antitrust. The panel affirmed the district court’s orders granting a preliminary injunction and denying a motion to compel arbitration in an antitrust action brought by a group of West Coast fishermen against seafood processors. A previous antitrust action—brought by another group of fishermen against Frank Dulcich, seafood processor entities owned by Dulcich (“Pacific Seafood”), and Ocean Gold Seafoods, Inc.—was settled. Pacific Seafood subsequently announced that it was planning to acquire Ocean Gold. The current group of fishermen then brought claims under the Sherman Act and the Clayton Act, alleging monopolization and unlawful merger. The panel affirmed the district court’s denial of defendants’ motion to compel arbitration pursuant to the settlement agreement in the first action. Applying the Federal Arbitration Act, the panel held that the fishermen’s claims did not fall within the scope of the purported arbitration provision in the settlement agreement. The panel also affirmed the district court’s preliminary injunction against Pacific Seafood’s acquisition of Ocean Gold. The panel held that the fishermen showed a sufficient likelihood of success on the merits because they did not release their claims in the previous settlement agreement, and BOARDMAN V. PACIFIC SEAFOOD GROUP 5 they adequately demonstrated that the proposed transaction could substantially lessen competition. The fishermen also demonstrated a likelihood of irreparable harm. The district court did not abuse its discretion in finding that the balance of the equities tipped in favor of the fishermen. In addition, the preliminary injunction was in the public interest, and it was not overbroad. Concurring in part and dissenting in part, Judge Gilman agreed with the majority’s holding that the district court did not abuse its discretion in granting the preliminary injunction. Judge Gilman also agreed with the majority’s framework for analyzing motions to compel arbitration, but he dissented from the majority’s conclusion that the fishermen’s claims clearly and unambiguously fell outside the scope of the settlement agreement. Judge Gilman would hold that the scope of the language in the agreement was at best ambiguous, and he would resolve this ambiguity in favor of arbitration.
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