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Bay Shore Power Co. v. Oxbow Energy Solutions LLC

United States District Court, N.D. Ohio, Western Division

January 2, 2020

Bay Shore Power Company, Plaintiff
v.
Oxbow Energy Solutions LLC, Defendant

          MEMORANDUM OPINION AND ORDER

          Jeffrey J. Helmick United States District Judge

         I. Introduction

         Before me are Plaintiff and Defendant's cross-motions for summary judgment on Plaintiff's claim to contractual attorney fees. (Doc. Nos. 32 & 33). Each filed a memorandum in opposition to the motion of the other. (Doc. Nos. 34 & 35).

         II. Background

         In 1998, Plaintiff Bay Shore Power Company and Defendant Oxbow Energy Solutions LLC executed the Limestone Supply Agreement (“LSA”), whereby Oxbow would deliver limestone to Bay Shore for a certain price on a long-term basis. When the terms of the LSA became disadvantageous to Oxbow in 2012, a dispute arose. To resolve this dispute, the parties followed the Dispute Resolution Procedures of the LSA as required by Section 15.6, (Doc. No. 7-1 at 20), and went to arbitration in 2017.

         During arbitration, both parties requested attorneys' fees, but Oxbow did so “only ‘to the extent provided by the LSA.'” (Doc. No. 12-6 at 5). When evaluating the requests for attorneys' fees, the arbitration panel looked to subsections (b)(iv) and (b)(v) of the Dispute Resolution Procedures, which state,

(iv) Binding Nature. Any decision rendered by the arbitrators pursuant to any arbitration shall be final and binding upon the parties hereto, and judgment may be entered upon it in accordance with Applicable Law in any court of competent jurisdiction, including award of damages or injunctive relief, and may, in the discretion of the panel, assess the costs of the arbitration (including reasonable fees and expenses of the members of the panel) against any party as the panel shall determine (but excluding attorneys' fees which shall be borne by each party individually); provided, that the arbitrators shall have no power or jurisdiction to alter or modify any express provision to any agreement that is the subject of such arbitration or to make any award which, by its terms or effect, alters or modifies any such express provision. Any party to such arbitration may appeal to any State or Federal court of competent jurisdiction sitting in Cleveland, Ohio on the basis that the panel has made a mistake of law or the panel's finding or award is against the weight of evidence or is beyond the power or jurisdiction of the panel.
(v) Costs and Expenses. The prevailing party in any arbitration or court proceedings shall be reimbursed by the other party for all costs, expenses and charges, including, without limitation, reasonable attorneys' fees, incurred by said prevailing party.

(Doc No. 7-1 at 27-28).

         In its analysis of the issue, the arbitration panel noted that “subsection (b)(v) seems to contradict subsection (b)(iv)” and held that, due to the unclear language, the LSA did not give the panel jurisdiction to award attorneys' fees. (Doc. No. 12-6 at 5). Even so, the panel went on to analyze whether a “subsequent agreement conferred such jurisdiction.” (Id.). Ultimately, the panel held it did not have jurisdiction to award attorneys' fees, reasoning that,

even though there is some ambiguous and contradictory language in the LSA, one section of the LSA on its face contains language that prohibits the award of attorneys' fees by an arbitration panel. Since, Oxbow's request specifically acknowledges that it was limited by the language of the LSA, we do not find that the parties agreed through their pleadings to waive the language of the LSA.

(Id.).

         After deciding it did not have jurisdiction to award attorneys' fees, the arbitration panel resolved the underlying dispute in favor of Bay Shore and awarded Bay Shore “$4, 868, 326.47 plus interest at the statutory rate from the date of th[e] Award.” (Id. at 15). Subsequently, Bay Shore brought this action to confirm the arbitration award and obtain attorneys' fees incurred during arbitration. (Doc. No. 1). After some motion practice, the parties filed a joint stipulated motion to resolve the confirmation-of-award issue proposing that Oxbow would pay Bay Shore the amount awarded plus interest accrued through March 30, 2018 on or before March 30, 2018. (Doc. No. 25). I granted this stipulated motion. (Doc. No. 26). Accordingly, all that remains is Bay Shore's claim to arbitration-related attorneys' fees.

         III. ...


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