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Seldin v. Seldin

United States Court of Appeals, Eighth Circuit

January 2, 2018

Scott A. Seldin Plaintiff-Appellant
v.
Theodore M. Seldin; Stanley C. Silverman; Mark Schlossberg Defendants-Appellees Deny Seldin; Traci Seldin Moser Intervenor Plaintiffs Scott A. Seldin Plaintiff-Appellee Deny Seldin; Traci Seldin Moser Intervenor Plaintiffs-Appellants
v.
Theodore M. Seldin; Stanley C. Silverman; Mark Schlossberg Defendants-Appellees

          Submitted: November 16, 2017

         Appeals from United States District Court for the District of Nebraska - Omaha

          Before BENTON, SHEPHERD, and KELLY, Circuit Judges.

          SHEPHERD, Circuit Judge.

         In 2010, feuding members of the Seldin family entered into a Separation Agreement to divide jointly owned assets. The Separation Agreement contained an arbitration clause, requiring the parties to arbitrate any claims involving their jointly owned property. Rather than arbitrating, Appellant Scott Seldin ("Scott") filed a lawsuit for an accounting of a trust that he claims was not included in the Separation Agreement. The district court dismissed his claim, finding that the federal courts lacked subject matter jurisdiction to hear the lawsuit. We disagree.

         I. Background

         Millard Seldin ("Millard"), Scott's father, created the Millard Seldin Children's Master Trust ("MSCM Trust") in 1992. Theodore Seldin and Stanley Silverman (together "Appellees") were designated as two of the trustees for the MSCM Trust. Scott, along with his siblings, Derry Seldin and Traci Seldin Moser (together "Intervenors"), were the beneficiaries of the trust. The MSCM Trust required an annual accounting of the trust assets. Scott alleges that Appellees breached their fiduciary duties as trustees and never submitted a trust report to Scott or Intervenors. The trust was dissolved in 2002.

         In February 2010, Scott and Millard entered into the Separation Agreement with Appellees in order to split the assets in which they had joint interests. The Separation Agreement included an arbitration clause to settle any disputes arising out of or relating to the Separation Agreement or the parties' joint ownership properties or entities. In October 2011, the parties initiated arbitration proceedings. In February 2012, the parties agreed to mediate, using the arbitrator as the mediator. The mediation fell apart, and the arbitration resumed. Following the mediation, Scott began lodging complaints against the arbitrator/mediator, calling for his resignation, but the arbitrator/mediator refused.

         Scott then filed three separate lawsuits against Appellees in the Douglas County, Nebraska District Court regarding the parties' joint interests, and each of the lawsuits was dismissed. Scott filed his first state court lawsuit in April 2012, alleging claims that were already pending in arbitration. Among his claims was a cause of action for a full accounting from 1987 to present. The court dismissed Scott's claim, finding that he was required to submit to arbitration.

         In June 2012, Scott filed a second state court lawsuit, amending the complaint on October 10, 2012. In March 2013, the state court similarly dismissed the second lawsuit, ordering the parties to resolve their issues through arbitration. In September 2012, Scott filed a demand with the American Arbitration Association (the "AAA") for the disqualification of the arbitrator. The AAA reaffirmed the arbitrator. Scott filed a Motion to Reconsider or Clarify Ruling, and the AAA denied the motion.

         In December 2012, Scott filed a third lawsuit asking the state court to vacate the AAA ruling or to enjoin arbitration, remove the arbitrator, and reinstate the first lawsuit. In April 2013, the state court dismissed the third lawsuit. Scott appealed each of the lawsuits. Pending the appeals, the arbitrator stepped down, and the designated replacement arbitrator refused to serve. The parties agreed to select a new arbitrator through the AAA. Appellees moved to dismiss the appeals as moot, and on August 28, 2013, the Nebraska Supreme Court granted their motion.

         In October 2013, a new arbitrator was appointed, and the arbitration recommenced. On July 29, 2016, Scott filed a lawsuit in federal court against Appellees, requesting an accounting of the MSCM Trust. Intervenors attempted to intervene, but their motion was denied. Appellees filed a motion to dismiss for lack of subject matter jurisdiction. The district court granted Appellees' motion to dismiss, holding that the court did not have jurisdiction because there was a binding arbitration agreement which gave the arbitrator the authority to first decide the extent of his jurisdiction. Furthermore, the court stated it did not have jurisdiction because res judicata and issue preclusion applied. Finally, the court also found that the Rooker-Feldman doctrine barred the court from hearing Scott's claim.

         On April 27, 2017, after all of the briefing was submitted for this appeal, the arbitrator entered a Final Award, finding that the Appellees are entitled to recover from Scott a net amount of $2, 977, 031, plus post-award simple interest from the date of the award.[1] On May 23, 2017, Appellees filed a Motion to Confirm Arbitration Award as Judgment in state court.

         II. ...


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