Answers in Genesis of Ky v. Creation Ministries

• Decision Date: 13 February 2009
• Docket Number: No. 08-6032.,No. 08-6014.,08-6014.,08-6032.
• Citation: 556 F.3d 459
• Parties: ANSWERS IN GENESIS OF KENTUCKY, INC., Plaintiff-Appellee/Cross-Appellant, v. CREATION MINISTRIES INTERNATIONAL, LTD., Defendant-Appellant/Cross-Appellee.
• Court: U.S. Court of Appeals — Sixth Circuit

556 F.3d 459

ANSWERS IN GENESIS OF KENTUCKY, INC., Plaintiff-Appellee/Cross-Appellant, v. CREATION MINISTRIES INTERNATIONAL, LTD., Defendant-Appellant/Cross-Appellee.

No. 08-6014.

No. 08-6032.

United States Court of Appeals, Sixth Circuit.

Argued: January 21, 2009.

Decided and Filed: February 13, 2009.

ARGUED: Richard Alan Getty, Getty & Childers, Lexington, Kentucky, for Appellant.

Anthony J. Biller, Coats & Bennett, Cary, North Carolina, for Appellee. ON BRIEF: Richard Alan Getty, Getty & Childers, Lexington, Kentucky, for Appellant. Anthony J. Biller, Coats & Bennett, Cary, North Carolina, for Appellee.

Before: COLE and GIBBONS, Circuit Judges; BELL, District Judge.^*

OPINION

JULIA SMITH GIBBONS, Circuit Judge.

This appeal presents multiple issues of first impression for our circuit. Defendant-appellant Creation Ministries International, Ltd., ("CMI") appeals the district court's order compelling arbitration of its disputes with fellow ministry Answers in Genesis of Kentucky, Inc. ("AiG"). Specifically, CMI asserts that the district court erred in declining to dismiss AiG's suit on the basis of the contracts' forum selection clause, declining to abstain in favor of CMI's prior-filed Australian litigation, and compelling arbitration on all of AiG's claims. AiG cross-appeals the district court's order declining to issue a foreign antisuit injunction to block CMI from further pursuing its Australian litigation. We hold that the district court properly compelled the parties to arbitration and did not abuse its discretion in declining to issue an antisuit injunction based upon the facts as they now stand. We therefore affirm the judgment of the district court in its entirety.

I.

This case arises from a motion to compel arbitration filed under the Federal Arbitration Act ("FAA"), 9 U.S.C. § 206, by AiG, a Kentucky non-profit corporation headquartered in Petersburg, Kentucky, against CMI, an Australian non-profit corporation organized under the laws of the State of Queensland, Australia. In 1980, a group of Australian religious adherents joined together to form the Creation Science Foundation ("Foundation"), CMI's predecessor organization. According to one of the original members, the Foundation's purpose "was to promote creationism and apologetics" throughout Australia. Among the founders was Ken Ham, an Australian minister and "creation science" advocate. Since the 1970s, another Australian creation science supporter, Carl Wieland, began publishing a magazine known as Ex Nihilo to publicize advances in creation science. The magazine would later become known as Creation Magazine. Wieland transferred production responsibility to the Foundation for his magazine sometime "in the late 1970's or early 1980's." Wieland joined the Foundation and, along with Ham, became one of the Foundation's two main leaders.

In 1987, Ham moved from his native Australia to the United States. Seven years later, Ham founded an American counterpart to the Foundation headquartered in Kentucky, which would become known as AiG. The two organizations were separate entities but worked closely together until the events that gave rise to the current litigation occurred. As AiG grew in membership and financial resources, it began to eclipse its Australian counterpart, which had by now come to be led largely by Wieland. AiG established and funded a website, www.answersing enesis.org, that both AiG and the Foundation used to spread the discoveries of creation science. AiG also purchased significant numbers of each issue of Creation Magazine for distribution to American subscribers. AiG's growth caused significant tension to develop between Ham and Wieland, as each vied for control of what was becoming an increasingly international movement to teach creationism.

The Foundation¹ had joined with AiG in founding Answers in Genesis International ("AiGI") to foster relationships among creation science organizations in other Commonwealth countries, such as Canada, South Africa, New Zealand, and the United Kingdom. Ownership of AiGI was split between the Foundation and AiG. AiG held a fifty percent share in AiGI. Around March 2005, Wieland proposed a new model for control of AiGI. Wieland referred to this new proposal as a much needed "democratic reform" in the structure of the international ministry. The "reform" would give each branch of the international ministry one vote at AiGI board meetings. From AiG's perspective, the sole purpose of this reform was to dilute the American organization's influence over the creation science movement and concomitantly place Wieland in sole control of AiGI. AiG believed that the small organizations in countries such as South Africa and New Zealand were under Wieland's control to the extent that their votes would merely parrot his. Unsurprisingly, AiG rejected Wieland's democratic reform, and relations between the American and Australian ministries deteriorated rapidly.

Some of the Foundation's board members sought to heal the developing schism. They tried to accomplish this by moving toward a more business-like relationship with AiG. On October 11-13, 2005, the boards of directors of both AiG and the Foundation met in Petersburg, Kentucky, in an attempt to settle their differences over the control structure of AiGI as well as the disputes that arose over Creation Magazine's content and distribution and the content found on the two ministries' joint website. The meetings produced a series of signed agreements that form the basis of the current litigation on two continents.

On October 13, 2005, the members of both organizations' boards of directors executed a Memorandum of Agreement ("MOA"). The MOA provided for several transfers of property and contractual rights in an attempt to divide each organization's responsibilities within the larger creation science movement. Among other provisions, the MOA required the Foundation to transfer to AiG ownership of certain international copyrights and the competing domain name www.answersing enesis.com. MOA at 1. The Foundation would also begin to pay a fee to AiG for AiG's maintaining their joint website www. answersingenesis.org. MOA at 2. In return, AiG would transfer to the Foundation AiG's fifty percent voting share in AiGI, giving the Foundation complete control over the international organization. MOA at 1. AiG also agreed to pay a fee to the Foundation for each future article the Foundation provided for the joint website. The Foundation concomitantly agreed to grant an express license to AiG for the use of all articles that had previously appeared on either the website or in AiG's publications. MOA at 2. Most importantly, the MOA closed with an arbitration clause that provided "in the event of a disagreement" the parties would "submit the matter to Christian arbitration." MOA at 2-3.

That same day, the parties also executed a Deed of Copyright License ("DOCL"). The DOCL granted AiG a license to continue to use the articles the Foundation had provided for its website and publications. DOCL at 5-6. Thus, the DOCL fulfilled the Foundation's obligations under the MOA to validate AiG's use of the Foundation's intellectual property. The DOCL closed by noting that "the law applicable to the State of Victoria, Australia" applied and "[t]he parties submit to the non-exclusive jurisdiction of its courts and courts of appeal." DOCL at 7-8.

Although the two boards had ratified the agreements, Wieland fiercely objected to their content. Deepening internal tension led the membership of the Foundation's board to resign. Wieland replaced the board's membership with appointees of his own liking. This new board joined Wieland in seeking to reject the MOA and DOCL. The board also voted to change the name of the Foundation to its current name of Creation Ministries International ("CMI") effective January 19, 2006. The CMI board sought to explain its actions by commissioning an internal inquiry to examine the circumstances that led to the schism between CMI and AiG. This inquiry, known as the "Briese Report," released its findings on February 16, 2007. The Briese Report concluded that the position of Wieland and his new board was correct and that the new board had properly sought to renounce the prior board's actions. The Briese Report also sought to cast blame for the schism onto AiG.

AiG rebuffed CMI's efforts to invalidate the agreements. With both sides having reached an impasse over the status of the MOA and DOCL, legal action commenced. CMI struck first; and on May 31, 2007, it filed suit in the Supreme Court of Queensland² against both AiG and AiG's leader Ken Ham. CMI's "Statement of Claim" sought declaratory, injunctive, and monetary relief as to both defendants. The complaint did not seek to compel arbitration.

The parties attempted one last time to reach an out-of-court settlement by meeting with a mediator in Hawaii on August 14-15, 2007. Ultimately, the parties were unable to agree upon any settlement. On January 29, 2008, the parties halted all efforts to reach an amicable agreement, and CMI instructed AiG to proceed with its defense in the Australian action.

Instead, on March 24, 2008, AiG moved to compel arbitration in the Eastern District of Kentucky under the FAA. AiG additionally sought to enjoin CMI from pursuing its Australian suit. Both parties informed the district court that the parties had agreed voluntarily to adjourn the Australian proceedings pending final resolution of the American litigation. The district court conducted a hearing and on August 8, 2008, issued its order and opinion. In its opinion, the district court read the multiple agreements in para materia because they were all executed on the same day as part of an effort to achieve a settlement of all outstanding issues. Answers in Genesis of Ky., Inc. v. Creation Ministries Int'l, Ltd., No. 2:08-cv-00053-WOB, slip op. at 2, 2008 WL 5657681 (E.D.Ky. Aug. 4, 2008). The district court...