April 7, 2017
from the United States District Court for the Northern
District of Illinois, Eastern Division. No. 13 C 3224 - Ruben
Castillo, Chief Judge.
Posner, Ripple, and Sykes, Circuit Judges.
POSNER, Circuit Judge.
Tonya Davis sued Ernest Fenton (as well as Fenton's law
firms) in federal district court asserting state malpractice
and breach of contract claims, as well as federal Fair
Housing Act and Civil Rights Act claims, all arising out of
Fenton's representation of Davis in a mortgage
foreclosure action in which Davis had lost her home. Davis
alleged that Fenton's representation of her had been
deficient, and that he had targeted her for deficient
representation because of her race.
asked the district court to stay the lawsuit pending
arbitration, because his contract with Davis to represent her
in the foreclosure action had required the parties to
arbitrate any disputes arising from the representation; and
the Federal Arbitration Act, 9 U.S.C. § 3, provides that
when the parties to a dispute litigable in federal court have
a written agreement to arbitrate their dispute, either of the
parties is entitled to stay the trial of the action until the
arbitration is complete, provided that the applicant for the
stay is not in default of its obligations in the arbitration.
that Fenton's request for a stay was proper, the district
judge ordered the suit "stayed pending
arbitration"; the docket reflects that the lawsuit was
"administratively dismissed without prejudice subject to
full reinstatement upon the completion of the required
arbitration, " which awarded Davis $82, 528.10 in
damages for malpractice but denied her other claims. Fenton
then sued Davis in an Illinois state court to have the
arbitration award vacated or at least reduced. Davis
responded by moving the federal district court to reinstate
her suit because the arbitration had been concluded, to
confirm the arbitration award pursuant to 9 U.S.C. § 9,
and to permit her to file a new Fair Housing Act claim
against Fenton, accusing him of retaliating against her for
having filed her original Fair Housing Act claim.
Fenton failed to appear at the hearing in the district court
on Davis's motion, the judge entered a default judgment
granting the motion, reinstating the case, and confirming the
arbitration award. He also permitted Davis to file her new
Fair Housing Act claim. Fenton moved the court to vacate the
default judgment and remand the case to state court, on the
ground that the district court lacked jurisdiction because he
(Fenton) had filed his state lawsuit challenging the
arbitration award prior to Davis's having moved the
district court to re-open the case. The district judge
refused, reminding the parties that "I was the
one that enforced the defendants' request for arbitration
and I sent the case for arbitration. So it would seem to me,
because I retained jurisdiction, that any request to vacate
the arbitration award that the plaintiff won should have come
to this Court and not to some [state court] judge."
Fenton also moved the district court to dismiss Davis's
retaliation claim; the court granted the motion.
appeal Fenton has renewed his challenge to the district
judge's jurisdiction to confirm the arbitration award.
But the challenge is meritless-the judge had jurisdiction
over the case at the time it was filed, as it raised
questions of federal law, and the judge's order staying
the case (or, equivalently, administratively dismissing it
subject to reinstatement at the conclusion of arbitration)
retained jurisdiction to confirm or vacate an arbitral award.
Baltimore & Ohio Chicago Terminal Railroad Co. v.
Wisconsin Central Ltd., 154 F.3d 404, 407 (7th Cir.
true notwithstanding Magruder v. Fidelity Brokerage
Services LLC, 818 F.3d 285 (7th Cir. 2016), a case in
which an aggrieved customer of Fidelity had arbitrated his
dispute with the company, lost, filed a federal lawsuit
asking the court to overturn the arbitrator's decision,
and argued that the court had jurisdiction to vacate the
award because the arbitrator had resolved a question of
federal law. But we ruled that "a federal issue resolved
by the arbitrator does not supply subject-matter
jurisdiction for review or enforcement of the award."
Id. at 288 (emphasis in original). Because there was
no other basis for subject-matter jurisdiction, the suit
should have been dismissed. Davis's federal suit, in
contrast, preceded the arbitration and was stayed pending it;
upon completion of the arbitration she returned to the
federal court seeking confirmation of the award. Because her
suit had been stayed, not dismissed, the court, by virtue of
having jurisdiction over the original lawsuit, retained
jurisdiction not only over her request to confirm the award
but also over her federal-law claims.
other issue needs to be resolved-Davis's appeal of the
dismissal of her retaliation claim. In her original lawsuit
against Fenton she'd been represented by two lawyers,
whom after the lawsuit was filed Fenton sued in state court,
accusing them of having improperly acquired confidential
information, and spread false information, about his
business. See Fenton v. Dudley,761 F.3d 770 (7th
Cir. 2014). Fenton asked the state court for an injunction
against the lawyers prohibiting them from speaking to Davis
about her lawsuit against him, and the state court granted
the injunction (although it was eventually lifted). Davis now
argues that Fenton's lawsuit was in retaliation against
her for having filed her original Fair Housing Act claim
against him, and was therefore a further violation of the
Fair Housing Act. The Act does prohibit retaliation against a
person for exercising his or her rights under the Act; see 42