In an order dated July 30, 2010, federal judge Anna Brown, in JuiceMe, LLC v. Booster Juice Limited Partnership, stayed federal court litigation brought in Oregon against Stoll Berne clients Booster Juice Limited Partnership, AW Limited Partnership, AW Holdings, Inc., and Jonathan Amack.  Plaintiffs filed their complaint against Stoll Berne's clients and another group of defendants shortly before an American Arbitration Association proceeding involving the same parties was terminated.  Stoll Berne's clients sought to stay the federal litigation under Section 3 of the Federal Arbitration Act ("FAA") on the grounds that, despite termination of the arbitration proceeding, plaintiffs' claims still were subject to a binding agreement to arbitrate.

The arbitration proceeding was terminated after Stoll Berne's clients informed AAA that they were unable to pay one-third of the estimated arbitration fees and costs, as previously had been agreed orally among the parties.  Neither plaintiffs nor the other defendants were willing to pay Stoll Berne's clients' portion of arbitration fees and costs.  The arbitration panel issued an order terminating the arbitration unless the arbitration was fully funded within seven days.  When, after seven days, the arbitration was not funded, the proceeding was terminated.

In opposition to the motion to stay, plaintiffs argued that - by failing to pay one-third of the arbitration costs and fees - Stoll Berne's clients had violated the arbitration agreement and therefore was not entitled to a stay under the FAA.  The court, however, held that whether Stoll Berne's clients' inability to pay arbitration costs and fees constituted a failure, neglect, or refusal to arbitrate in violation of the parties' arbitration agreement is an issue for the arbitrators, not for the court.  Because plaintiffs did not move for an order of default against Stoll Berne's clients prior to termination of the arbitration, and because the arbitrators did not otherwise have an opportunity to consider this issue, the court stayed the federal litigation pending arbitration or until an arbitrator determines that Stoll Berne's clients are in violation of the parties' arbitration agreement.

Stoll Berne attorneys Robert Shlachter and Keil Mueller represent Booster Juice Limited Partnership, AW Limited Partnership, AW Holdings, Inc., and Jonathan Amack.