White v. U.S. Center for SafeSport

Background

SafeSport is a nonprofit organization that Congress authorized to determine the eligibility of participants in the Olympic and Paralympic Movement. SafeSport investigated allegations that Charles White, a former riding instructor and horse trainer and longtime member of the United States Equestrian Federation, engaged in sexual misconduct. SafeSport found, under a preponderance-of-the-evidence standard, that White had committed multiple acts of sexual misconduct and permanently banned him from participating in the Olympic and Paralympic Movement.

White sought review by an arbitrator under SafeSport’s governing code. After a three-day evidentiary hearing, the arbitrator issued a written decision affirming the ban. White then petitioned the court under Section 10 of the Federal Arbitration Act to vacate, or cancel, the arbitration award. The court also held an initial hearing concerning White’s allegation that SafeSport’s payment of fees may have improperly influenced the arbitrator.

Jurisdictional Concern

The court independently identified an unanswered question about subject-matter jurisdiction, meaning the court’s legal authority to hear the petition. The court explained that the Federal Arbitration Act authorizes applications to confirm, vacate, or modify arbitration awards, but those provisions do not themselves create federal jurisdiction. A party seeking to vacate an arbitration award therefore must identify a separate basis for federal jurisdiction.

White invoked diversity jurisdiction. That form of jurisdiction generally requires a dispute between citizens of different states involving more than $75,000. Because White sought only to vacate the lifetime ban, the court treated the requested relief as nonmonetary. White alleged that the amount in controversy exceeded $75,000 and stated that the ban would cause irreparable and permanent harm. In his motion papers, he also alleged that his hay-sales business had suffered and that he had lost hay-sales contracts, but he did not provide a dollar value for those alleged losses.

The court concluded that White had not meaningfully connected vacating the arbitration decision to the claimed amount in controversy. As a result, the court could not determine whether he had plausibly alleged the amount required for diversity jurisdiction. The court also stated that, for this jurisdictional question, it looked to the petition itself rather than to the underlying dispute that led to the arbitration.

Order

The court ordered White to show cause in writing by April 7, 2023, why the petition should not be dismissed without prejudice for lack of subject-matter jurisdiction. The order stated that failing to respond would result in dismissal without prejudice under Federal Rule of Civil Procedure 41(b). The order also allowed White, instead of responding to the show-cause order, to dismiss the case without prejudice in favor of pursuing possible remedies in state court.

The court did not dismiss the petition in this order. It administratively terminated White’s motion to vacate pending further order. The court granted the parties’ administrative motions to file specified documents under seal because the documents were designated confidential by statute, derived from confidential documents, or designated confidential under the SafeSport Code.