Zurich Ins. PLC v. Ethos Energy (USA) LLC

Zurich Ins. PLC v. Ethos Energy (USA) LLC

Opinion

OPINION AND ORDER

Before the Court is Defendant Ethos Energy's ("Ethos") Motion to Dismiss Plaintiff Zurich Insurance's ("Zurich") claims pursuant to Federal Rule of Civil Procedure 12(b)(1). Doc. 5. After reviewing the parties' submissions and the applicable law, the Court finds that it does not have subject-matter jurisdiction over this action. The Court grants Defendant's motion to dismiss.

I. Background

This case arises from an action to enforce an arbitrator's subpoena directing a non-party to the arbitration to produce documents pursuant to 9 U.S.C. § 7, also known as Section 7 of the Federal Arbitration Act ("FAA"). The underlying arbitration involves Zurich and TransCanada Turbines, Ltd. ("TCT"). Doc. 1 at 1. Zurich initiated the proceedings on behalf of its subrogors, seeking compensation for damage sustained to a turbine owned by these subrogors during TCT's repair work. Id. at 2-3. Zurich claims that "[a]t the time relevant [*2]  to the underlying dispute, a company identified as Wood Group de Chile S.A., contracted with Zurich's subrogors to provide operational and management services at the subrogors' facility. Id. at 3. Zurich further alleges that Ethos is a successor corporation to Wood Group and also "a corporation intimately related to . . . TCT." Id. Zurich claims that pursuant to an Operation and Maintenance Agreement with Wood Group, Ethos has a contractual obligation to provide Zurich's subrogors with documentation related to warranty claims. Id. at 5. Thus, Zurich seeks to compel Ethos to produce discovery documents related to its arbitration action with TCT. Id.

After some time of attempting to get Ethos to comply with discovery requests, Zurich obtained a subpoena duces tecum from the arbitration panel compelling Ethos to produce the documents. Id. Ethos refuses to respond to the subpoena and Zurich brings the present suit asking the Court to order cooperation. Id. at 6-7. Ethos moved to dismiss the action on two grounds: (1) subject-matter jurisdiction is lacking because the FAA does not itself confer jurisdiction under a federal question, and the amount-in-controversy does not meet the $75,000 threshold required for diversity [*3]  jurisdiction; and (2) FAA §7 does not authorize the enforcement of pre-hearing document subpoenas of third parties. The Court finds that it lacks subject-matter jurisdiction over this action, and thus need not resolve the second issue.

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