In In re Mirant Corporation, the Fifth Circuit affirmed the lower court’s finding that the defendant waived its right to arbitrate. The defendant had filed multiple motions to dismiss based, in part, on waiver and estoppel, over a span of eighteen months. The court held that whether a motion to dismiss constitutes a waiver of arbitration as an invocation of the judicial process is a case-by-case determination. Here, the court explained, the defendant’s multiple motions invoked the judicial process by seeking a decision on the merits and a dismissal with prejudice for failure to state a claim. The court was also persuaded by the fact that the defendant did not file its motions to dismiss as an alternative to arbitration, but instead filed them prior to seeking arbitration as a “backup plan.” Lastly, the court held that the plaintiff was prejudiced both legally and financially by the defendant’s tactics. In re Mirant Corp., No. 09-10451 (5th Cir. August 2, 2010).
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Fifth Circuit holds defendant waived right to arbitrate by filing motions to dismiss
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