Biller v. Toyota Motor Corp..

• Decision Date: 03 February 2012
• Docket Number: No. 11–55587.,11–55587.
• Citation: 668 F.3d 655,33 IER Cases 600,12 Cal. Daily Op. Serv. 1423
• Parties: Dimitrios Peter BILLER, Plaintiff–Appellant, v. TOYOTA MOTOR CORPORATION; Toyota Motor Sales, U.S.A., Inc.; Christopher Reynolds; Jane Howard Martin; Eric Taira; Dian Ogilvie; Alicia McAndrews, Defendants–Appellees.
• Court: U.S. Court of Appeals — Ninth Circuit

12 Cal. Daily Op. Serv. 1423

33 IER Cases 600

668 F.3d 655

Dimitrios Peter BILLER, Plaintiff–Appellant,

v.TOYOTA MOTOR CORPORATION; Toyota Motor Sales, U.S.A., Inc.; Christopher Reynolds; Jane Howard Martin; Eric Taira; Dian Ogilvie; Alicia McAndrews, Defendants–Appellees.

No. 11–55587.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted Dec. 8, 2011.Filed Feb. 3, 2012.

Dimitrios P. Biller, Pacific Palisades, CA, appellant, Pro Se.

David L. Schrader, Roger K. Smith, Morgan, Lewis & Bockius, Los Angeles, CA, for the appellees.

Appeal from the United States District Court for the Central District of California, George H. King, District Judge, Presiding. D.C. No. 2:09–cv–05429–GHK–RZ.Before: JOHN T. NOONAN, RONALD M. GOULD, and SANDRA S. IKUTA, Circuit Judges.

OPINION

GOULD, Circuit Judge:

Dimitrios P. Biller (“Biller”) appeals the district court's order affirming an arbitration award and permanent injunction against him in favor of his former employer, Toyota Motor Corp. We have jurisdiction pursuant to 28 U.S.C. § 1291, and we affirm.

A

Appellant Biller worked as in-house counsel for Toyota Motor Sales (“TMS”), a subsidiary of Toyota Motor Corp., from 2003 to 2007, with responsibilities on product liability matters. In 2007, Biller presented TMS with a claim asserting, inter alia, constructive wrongful discharge related to TMS's alleged unethical discovery practices. TMS and Biller settled the claims, and, in September 2007, the parties signed a Severance Agreement, in which Biller agreed 1) to give a broad release of his claims relating to his employment with and separation from TMS; 2) to protect and not to disclose Toyota's Confidential Information, a term defined in the Severance Agreement; ¹ 3) to return to TMS all of Toyota's Confidential Information in his possession; and 4) not to copy that Confidential Information.

With respect to Dispute Resolution, the parties agreed to arbitrate “all known and unknown” claims that relate, inter alia, to the interpretation, application, or alleged breach of the Severance Agreement. The relevant Arbitration Rules and Procedures in the Severance Agreement state that:

The arbitration shall be held in accordance with the rules and regulations of Judicial Arbitration and Mediation Services (JAMS) pertaining to employment disputes.... If the dispute is not resolved in informal discussions or at mediation, the arbitration shall be final and binding upon the Parties and shall be the exclusive remedy for all Arbitrable Claims. The Arbitrator is required to follow the applicable law and case precedent of the jurisdiction where [Biller] last worked for TMS and will have full authority to award relief available to be awarded had the dispute been brought in any other forum such as a federal or state court. The Arbitrator will issue with his/her award a written discussion sufficient to permit limited judicial review to enforce or vacate the arbitration award....

The relevant written JAMS policy states:

The Award will consist of a written statement signed by the Arbitrator regarding the disposition of each claim and the relief, if any, as to each claim. The Award shall also contain a concise written statement of the reasons for the Award, stating the essential findings and conclusions on which the award is based.

Finally, with respect to the Governing Law, the Severance Agreement states:

This Agreement shall be governed by and construed in accordance with the laws of California; provided, however, that the arbitration agreement [in the Dispute Resolution clause] of this Agreement will be governed by the Federal Arbitration Act unless it is found by a decision maker of competent jurisdiction not to be governed by the Federal Arbitration Act, in which case it will be governed by California law.

After leaving TMS, Biller started Litigation, Discovery & Trial Consulting (“LDTC”), a consulting business providing seminars on various legal topics. On the LDTC website, Biller used information about his work on TMS products liability litigation, that TMS believed to be Confidential Information and allegedly to violate the attorney-client privilege. In November 2008, TMS sued in state superior court seeking a temporary restraining order (“TRO”) and permanent injunctive relief to prevent Biller from violating the attorney-client privilege. Biller filed a cross-complaint for a TRO and a permanent injunction prohibiting TMS from interfering with his business practices and those of LDTC.

TMS moved to compel arbitration under the terms of the Severance Agreement. The state superior court granted the motion, and the parties were ordered to arbitration, with the arbitrator to determine first whether the claims were arbitrable under the Severance Agreement. The Honorable Gary L. Taylor (ret.) (“the Arbitrator”) was appointed as the mutually-agreed-upon JAMS arbitrator.

In July 2009, Biller, on behalf of himself and LDTC, filed a complaint against TMS in the Central District of California, alleging violations under the RICO Act, constructive wrongful discharge, intentional infliction of emotional distress, and defamation per se. TMS moved to dismiss the RICO Act claim brought by LDTC and to compel arbitration under the Severance Agreement as to the claims brought by Biller individually. In November 2009, the district court dismissed the RICO Act claim (dismissing with prejudice LDTC from the action), and granted TMS's motion to compel arbitration as to Biller's individual claims. The parties stipulated that the arbitration of Biller's federal court claims would be consolidated with the arbitration of TMS's state court claims, both matters before the parties' chosen JAMS Arbitrator.

Pursuant to the consolidated arbitration, TMS submitted claims against Biller for 1) breach of contract, 2) conversion, and 3) statutory computer fraud. Biller submitted claims against TMS for 1) a violation of civil RICO, 2) constructive wrongful termination, 3) intentional infliction of emotional distress, and 4) defamation per se. Biller also submitted cross-claims against TMS for 1) unfair competition, 2) intentional economic interference, and 3) fraud and/or false promises, but during the arbitration hearing Biller withdrew his cross-claims for unfair competition and intentional economic interference.

After briefing on the validity and enforceability of the Severance Agreement, the Arbitrator concluded, in March 2010, that the Severance Agreement was valid and enforceable. In April 2010, TMS filed a motion for summary judgment on Biller's civil RICO Act and intentional infliction of emotional distress claims. After permitting Biller to conduct discovery for four months, the Arbitrator granted TMS's motion in October 2010.

An arbitration hearing was conducted between November 15, 2010 and November 30, 2010. The parties submitted briefs and presented 20 witnesses. After hearing closing arguments for a full day on November 30, 2010, the Arbitrator issued his Final Award along with a Permanent Injunction. The Arbitrator decided that Biller was liable to TMS on all of its claims (breach of contract, conversion, and unauthorized computer access), and that TMS was entitled to injunctive relief, punitive damages, and liquidated damages, as agreed upon in the Severance Agreement. The Arbitrator awarded TMS $2.5 million in liquidated damages and $100,000 in punitive damages.

The Arbitrator also concluded that Biller had a continuing duty to safeguard and not to disclose TMS's Confidential Information, and issued a Permanent Injunction prohibiting Biller from, inter alia, disclosing Confidential Information and destroying Confidential Information in his possession and ordering Biller to return to TMS all copies of Confidential Information in his possession or control. The Permanent Injunction also required Biller to permit TMS to inspect fully and forensically search his computers' hardware for Confidential Information, to copy any such Confidential Information found, and to delete such Confidential Information from Biller's hardware. The Arbitrator found that Biller's remaining claims of fraud and/or false promises and defamation per se were not supported by the evidence. Accordingly, the Final Award resolved all of the claims submitted for decision.

In January 2011, TMS moved to confirm the Final Award and the Permanent Injunction in the district court. The district court reviewed the Final Award under the Federal Arbitration Act (“FAA”) and held that 1) Biller did not show that the Arbitrator demonstrated manifest disregard of the law concerning his affirmative defenses raised under California law; 2) the Arbitrator was not required, under the FAA, to provide a written explanation for his rulings and any purported failure to do so was not grounds for vacatur under the FAA; 3) in any case, the Arbitrator's written explanation sufficiently addressed Biller's affirmative defenses under state law; 4) manifest disregard of the facts, including any failure by the Arbitrator to make findings in light of Biller's evidence offered under California Rule of Evidence 956's crime/fraud attorney disclosure exception showing TMS's purported discovery misconduct,² is not grounds for vacatur; and 5) Biller did not show that the Arbitrator was partial to TMS. The district court confirmed the Final Award, granted the Permanent Injunction, and denied Biller's request for vacatur of the Final Award.

TMS also moved to confirm the Final Award and Permanent Injunction in the state court. The state superior court granted TMS's motion in May 2011. Biller then argued that, in moving to confirm the Final Award and Permanent Injunction, TMS had taken a position in state court that conflicted with TMS's position before the district court, and Biller moved, in the district court, for an order to void the judgment and vacate the Final Award under Fed.R.Civ.P. 60(b),³ to award sanctions under Fed.R.Civ.P. 11, and to find...