Sujit Ghosh, President of Open Orbit Corporation, entered into a Personal Guaranty for the “full and timely performance of and by” Open Orbit under a Retailer Agreement with DISH Network, LLC. The Personal Guaranty included a final and binding arbitration clause of “any and all disputes, controversies or claims arising out of or in connection with this Personal Guaranty.” A dispute arose, and arbitration commenced. Ghosh requested the arbitrator remove him from the arbitration which was denied, as the arbitrator required a written agreement signed by DISH releasing Ghosh from the Personal Guaranty. DISH prevailed and obtained a $220,000 arbitration award (plus post-award interest).
The District Court confirmed the award, and the Tenth Circuit affirmed, noting “Ghosh elected to appear in the existing arbitration, where he professed faith in the arbitrator, claimed to have provided all the evidence relevant to his request to nullify or cancel his liability under the Personal Guaranty, and acknowledged that the arbitrator’s decision would be final and binding.” There were no allegations of arbitrator misconduct.
The Tenth Circuit also rejected Ghosh’s argument that, because he was not a party to the arbitration, issue preclusion is not applicable, as Ghosh “raised and actually litigated the validity of his personal guaranty in the arbitration even though he was not a party to the arbitration itself.” Furthermore, exceptions to the rule again nonparty preclusion were present.
DISH Network, LLC v. Ghosh, No. 18-1131 (10th Cir. Oct. 11, 2018)
This post written by Nora A. Valenza-Frost.
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