National Resident Matching Program v. Alashry

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
NATIONAL RESIDENT MATCHING
PROGRAM,
Plaintiff,
Civil Action No. 17-2557 (RDM)
v.
MAHMOUD ALASHRY,
Defendant.
MEMORANDUM OPINION AND ORDER
This matter is before the Court on Plaintiff’s motion to remand, Dkt. 7, pursuant to 28
U.S.C. § 1447(c). Plaintiff National Resident Matching Program (“NRMP”) originally filed suit
to vacate an arbitration award in favor of Defendant Mahmoud Alashry (“Dr. Alashry”) in the
D.C. Superior Court. Dkt. 9-2 at 2. On November 28, 2017, Dr. Alashry removed the case to
this Court. Dkt. 1. NRMP argues that the Court lacks subject-matter jurisdiction because the
arbitration agreement specifies that D.C. law governs this dispute, and, because the amount in
controversy is insufficient to establish diversity jurisdiction. The Court disagrees and will,
accordingly, DENY Plaintiff’s motion to remand, Dkt. 7.
I. BACKGROUND
A. Factual Background
NRMP is an Illinois-based, not-for-profit corporation with its principal place of business
in Washington, D.C. Dkt. 1 at 1. NRMP “provide[s] a service by which it matches medical
school students and graduates to positions in United States graduate medical education residency
and fellowship training programs.” Id. Dr. Alashry is a citizen of Egypt—where he obtained his
medical degree—and currently resides in Florida. Dkt. 1-1 at 1 (Alashry Decl. ¶¶ 1–2). In 2014,
Dr. Alashry began a post-doctoral research fellowship at Mayo Clinic in Rochester, Minnesota.
Id. (Alashry Decl. ¶ 3). During his fellowship, Dr. Alashry “completed the United States
Medical Licensing Examination and obtained a certification from the Educational Commission
for Foreign Medical Graduates.” Id. He then applied to participate in NRMP’s 2016 medical
residency matching program (“Main Residency Match”), and, through that program, matched to
an internal medicine residency program at the North Florida Regional Medical Center
(“NFRMC”) on March 18, 2016. Id. at 2 (Alashry Decl. ¶ 5); Dkt. 10-2 at 11.
To participate in the Main Residency Match, Dr. Alashry entered into an agreement with
NRMP (“the Match Agreement”). Dkt. 5-2. Section 4.4 of the Match Agreement requires that
each applicant provide “complete, timely, and accurate information” throughout the match
process, and states that “NRMP is authorized to take appropriate action,” specified in a later
provision, if “NRMP believes it has credible evidence that an applicant . . . has violated
the . . . [a]greement.” Id. at 21. On February 22, 2016—before his match date—Dr. Alashry was
arrested for solicitation of prostitution in Minnesota and was subsequently charged on April 1,
2016. Dkt. 10-2 at 11–12; Dkt. 10-2 at 45 (Arb. Award ¶¶ 33–35). He proceeded with the
match, however, and did not disclose this information to either NRMP or the program he
matched with—NFRMC—until May 23, 2016, when he emailed the program director. Id. at 46
(Arb. Award ¶ 39), id. at 97.
Due to his arrest and pending charge, Dr. Alashry was not eligible for a J-1 visa and
could not start his residency with NFRMC in June 2016; consequently, NFRMC applied to
NRMP for a waiver of its match commitment to Dr. Alashry, which NRMP granted. Id. (Arb.
Award ¶ 42). NRMP then conducted an investigation into whether Dr. Alashry’s actions
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violated section 4.4 of the Match Agreement and determined that they did. Id. (Arb. Award
¶¶ 45–46). In accordance with section 8.2.1 of the Match Agreement, NRMP issued a Panel
Report imposing the following sanctions:
[T]he NRMP is notifying [Dr. Alashry’s medical] school of this violation and
asking that it become a part of his permanent record. The NRMP also bars Dr.
Alashry for one year from accepting or starting a position in any program
sponsored by a Match-participating institution . . . . , bars him from
participation in future NRMP Matches for two years, and will identify him as
a Match violator in the NRMP’s Registration, Ranking, and Results (R3)
system for two years, effective immediately.
Id. at 47 (Arb. Award ¶ 47). Dr. Alashry contested NRMP’s finding of culpability. Id. at 37
(Arb. Award ¶ 7).
B. Procedural Background
On September 9, 2016, Dr. Alashry filed a demand for arbitration, pursuant to section 15
of the Match Agreement, with the International Centre for Dispute Resolution (“ICDR”),
requesting a declaratory judgment that (1) he did not violate the Match Agreement, (2) the
NRMP lacked jurisdiction to sanction him for conduct that occurred after the conclusion of the
Match process, and (3) all of the sanctions in the Panel Report should be vacated. Id. NRMP
responded that the sanctions “imposed [were] appropriate.” Id. at 38 (Arb. Award ¶ 10). ICDR
appointed Elliot E. Polebaum as the sole arbitrator. Id. at 37–38 (Arb. Award ¶¶ 10–11). The
arbitrator conducted a hearing on May 16, 2017, and permitted the parties to submit post-hearing
briefs and replies. Id. at 38–39 (Arb. Award ¶¶ 14, 16–18). On July 13, 2017, the arbitrator
issued an award (1) vacating the “findings of violation” in the Panel Report “except insofar as
the Report’s violation finding encompasses a violation for untimely disclosure of the pending
criminal charges against Dr. Alashry during the period after April 1, 2016;” and (2) vacating the
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“sanctions . . . for violations of section 4.4 of the Agreement [as] arbitrary and capricious.” Id.
at 59 (Arb. Award ¶¶ 90–91).
On October 13, 2017, NRMP filed suit in D.C. Superior Court seeking to vacate the
arbitration award. Dkt. 9-1; Dkt. 9-2. In lieu of filing a response, Dr. Alashry removed the case
to this Court asserting both diversity and federal question jurisdiction. Dkt. 1 at 4–7. NRMP
now moves to remand, arguing that Dr. Alashry cannot show that the amount in controversy
exceeds $75,000, as required to establish diversity jurisdiction, 28 U.S.C. § 1332(a), or that the
case arises under federal law, 28 U.S.C. § 1331. Dkt. 7. NRMP does not contest that Dr.
Alashry has otherwise complied with the requirements for removal.
II. ANALYSIS
A defendant may remove a case to federal court if the federal court has original
jurisdiction over the matter. 28 U.S.C. § 1441(a). The fact that the state court—or, here, the
D.C. Superior Court—might have concurrent jurisdiction over NRMP’s claim is of no moment;
if the federal court has subject-matter jurisdiction, and if Congress has not expressly precluded
removal, the defendant may elect to litigate in the federal forum. See Breuer v. Jim’s Concrete
of Brevard, Inc., 538 U.S. 691, 697–98 (2003); 14B Charles Wright & Arthur R. Miller, Federal
Practice and Procedure § 3721, at 2–3 (4th ed. 2009). For the reasons set forth below, the Court
concludes that it has subject-matter jurisdiction pursuant to 28 U.S.C. § 1331, and that, as a
result, it need not address whether it has diversity jurisdiction. Because the Court has
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jurisdiction, and because NRMP does not contest that Dr. Alashry complied with the procedural
requirements for removal, the Court will deny NRMP’s motion to remand. 1
A. New York Convention
The parties agree that the Convention on the Recognition and Enforcement of Foreign
Arbitral Awards (“New York Convention”), 9 U.S.C. § 201 et seq., provides federal district
courts with jurisdiction over arbitration agreements and awards that “fall under” the Convention.
See id. § 203 (“An action or proceeding falling under the Convention shall be deemed to arise
under the laws and treaties of the United States.”). Moreover, although the parties do not focus
on 9 U.S.C. § 205, that provision is also of particular relevance here: it provides federal courts
with removal jurisdiction over proceedings that fall under the Convention. See id. (“Where the
subject matter of an action or proceeding . . . relates to an arbitration agreement or award falling
under the Convention, the defendant . . . may . . . remove such action or proceeding to the district
court of the United States.”). Rather than question that the Convention provides for federal
jurisdiction, NRMP argues, instead, that the Convention does not apply here.
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As a preliminary matter, the Court asked the parties to submit a joint status report addressing
whether the case is now moot. The parties represented that,
[g]iven NRMP’s need to issue its final report, Alashry’s desire to participate
in the Match program or to seek employment with a related program again, and
the impact to Alashry in the event that NRMP is permitted to disclose its final
report, regardless whether he elects to participate in the Match program, there
is a time-sensitive and present dispute between the parties that requires judicial
resolution.
Dkt. 17 at 2. The Court is, accordingly, satisfied that there remains a live controversy.
Contra O’Shea v. Littleton, 414 U.S. 488, 496 (1974) (finding case moot when
plaintiffs could not demonstrate “continuing, present adverse effects” of the
defendants’ actions).
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In particular, NRMP contends that its arbitration with Dr. Alashry does not “fall under”
the New York Convention because the Convention “specifically carve[s] out awards that are
‘entirely domestic in scope.’” Dkt. 7 at 11 (quoting Smith/Enron Cogeneration Ltd. P’ship, Inc.
v. Smith Cogeneration Int’l, Inc., 198 F.3d 88, 94 (2d Cir. 1999)). The Court disagrees. The
award at issue here is not “entirely domestic” because—as NRMP concedes—Dr. Alashry is a
citizen of Egypt. Dkt. 1-1 at 1 (Alashry Decl. ¶ 1). As such, the plain language of the New York
Convention expressly embraces the award. Section 202 provides that an “arbitral award arising
out of a legal relationship, . . . which is considered as commercial . . . , falls under the
Convention” unless it is “between citizens of the United States” and does not “involve[] property
located abroad, envisage[] performance or enforcement abroad, or ha[ve] some other reasonable
relation with one or more foreign states.” 9 U.S.C. § 202. Based on the statutory language, this
Court has set forth a four-factor test:
An arbitration award falls under the New York Convention if [1] the award
arises from a commercial legal relationship between the parties; [2] there was
a written agreement to arbitrate disputes arising from that relationship; [3] the
agreement provided for arbitration proceedings to take place in a signatory
country to the New York Convention; and [4] at least one of the parties is not
an American citizen.
Newco Ltd. v. Gov’t of Belize, 156 F. Supp. 3d 79, 81 (D.D.C. 2015). This case satisfies all four
requirements. The award arises from a commercial legal relationship between NRMP and Dr.
Alashry; the Match Agreement contains an arbitration clause, Dkt. 5-2 at 35; the agreement
specifies that arbitration proceedings shall take place in Washington D.C., id.; and Dr. Alashry is
an Egyptian citizen, Dkt. 1-1 at 1 (Alashry Decl. ¶ 1).
The case law NRMP relies upon provides no support to the contrary. NRMP quotes a
recent Second Circuit decision, CBF Indústria de Gusa S/A v. AMCI Holdings, Inc., 850 F.3d 58
(2d Cir. 2017), for the proposition that the New York Convention applies only to “arbitral
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awards ‘made’ in a foreign country;” “arbitral awards ‘made’ in the United States that a party
seeks to enforce in a different country;” and “nondomestic arbitral awards.” Dkt. 7 at 11
(quoting CBF Indústria de Gusa S/A, 850 F.3d at 70). According to NRMP, this means that
“[t]he focus of the Convention is . . . the situs of the arbitration.” Id. (quoting Smith/Enron
Cogeneration Ltd., 198 F.3d at 94). But NRMP takes that quote out of context. The court in
CBF Indústria de Gusa S/A further explained that “a non-domestic arbitral award” falls under the
New York Convention as long as it was “made” in the United States—that is, the parties agreed
to arbitrate in the United states—and it “involves entities that are not U.S. citizens.” 850 F.3d at
73. NRMP’s reliance on various district court opinions is similarly misplaced. As Dr. Alashry
correctly observes, those cases involved arbitrations between two U.S. citizens, and, are thus,
inapposite. See Dkt. 18 at 6 (citing Armstrong v. NCL (Bahamas) Ltd., 998 F. Supp. 2d 1335,
1338 (S.D. Fla. 2013); Matabang v. Carnival Corp., 630 F. Supp. 2d 1361, 1363–64 (S.D. Fla.
2009); Ensco Offshore Co. v. Titan Marine LLC, 370 F. Supp. 2d 594, 595 (S.D. Tex. 2005);
Colo. Mills LLC v. Sunrich, LLC, No. 10-cv-00673, 2010 WL 1413173, at *1 (D. Colo. Apr. 2,
2010)).
Accordingly, both the plain language of 9 U.S.C. § 202 and the precedent interpreting
that provision dictate that the award at issue here “falls under” the New York Convention. The
Court therefore has “original jurisdiction over [this] action . . . regardless of the amount in
controversy,” 9 U.S.C. § 203; see also 28 U.S.C. § 1331, and removal jurisdiction, 9 U.S.C.
§ 205; see also 28 U.S.C. § 1441(a).
B. Match Agreement
NRMP further contends that, notwithstanding the New York Convention, the terms of the
Match Agreement designate the D.C. Superior Court as the exclusive forum for adjudicating
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disputes arising from the arbitration. Dkt. 7 at 14; Dkt. 20 at 9–10. NRMP points to two
sections of the Match Agreement. Section 15 provides: “The arbitrator shall not have the power
to make an award that is inconsistent with the provisions of this Agreement or with District of
Columbia substantive law.” Dkt. 5-2 at 35. And section 17 provides: “This agreement is
governed by the laws of the District of Columbia, excluding its choice of laws provisions.” Id. at
36. According to NRMP, these provisions establish that the Match Agreement incorporates the
D.C. Revised Uniform Arbitration Act (“DCRAA”), D.C. Code § 16-4401 et seq., which confers
“exclusive jurisdiction” in the D.C. Superior Court over actions falling under the Act, see id.
§ 16-4426. The Court is unpersuaded.
As a threshold matter, even if the Match Agreement incorporates the DCRAA, § 16-
4426(b) has no bearing on this Court’s subject-matter jurisdiction. “[A]lthough . . . § 16-4426(b)
speaks in terms of the ‘exclusive jurisdiction’ of the D.C. Superior Court,” this Court held in
Equitas Disability Advocates, LLC v. Daley, Debofsky & Bryant, P.C., 177 F. Supp. 3d 197
(D.D.C. 2016), that, under similar circumstances, § 16-4426 was “best understood to pertain to
the proper venue or forum for judicial review of an arbitration award.” Id. at 207. The provision
cannot “strip” federal courts of subject-matter jurisdiction because, to the extent it so impinges, it
is preempted by 28 U.S.C. § 1331, which grants district courts “original jurisdiction” over cases
“arising under the Constitution, laws, or treaties of the United States,” and 9 U.S.C. § 205, which
authorizes a defendant to remove an action that “relates to an arbitration agreement or award
falling under the Convention” to federal district court, id. Cf. United States v. Peters, 9 U.S. (5
Cranch) 115, 136 (1809). As such, sections 15 and 17 of the Match Agreement, at best, serve as
forum selection clauses that designate the D.C. Superior Court as the exclusive venue for this
suit.
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But even that argument—to the extent NRMP raises it—fails. Interpreting sections 15
and 17 of the Match Agreement to confer exclusive venue in the D.C. Superior Court conflicts
with the plain language of those provisions. Section 15 states: “Judgment upon the [arbitration]
award rendered may be entered in any court having jurisdiction thereof.” Dkt. 5-2 at 35 (section
15) (emphasis added); see also id. at 36 (section 17) (“If any provision of this Agreement is
found . . . by any court of competent jurisdiction to be invalid, illegal, or unenforceable . . . that
provision shall be modified . . . .”). When faced with similar language in Equitas Disability
Advocates, LLC, this Court concluded that “there is no way to give . . . the word ‘any’ . . . a
plausible meaning” if the Court were to read the “generally worded choice-of-law clause in [the]
arbitration agreement” to “confer exclusive jurisdiction on the D.C. Superior Court.” 177 F.
Supp. 3d at 210, 212. The same is true here. The use of “any court” in section 15 is inconsistent
with the contractual specification of a single, exclusive forum, as NRMP contends. See
Matstrobuono v. Shearson Lehman Hutton, Inc., 514 U.S. 52, 63 (1995) (“[A] document should
be read to give effect to all its provisions and to render them consistent with each other.”);
Abdelrhman v. Ackerman, 76 A.3d 883, 891 (D.C. 2013) (“When interpreting a contract, we
‘strive to give reasonable effect to all its parts and eschew an interpretation that would render
part of it meaningless . . . .’” (quoting District of Columbia v. Young, 39 A.3d 36, 40 (D.C.
2012))). The better reading of sections 15 and 17 is that they function, instead, as choice-of-law
provisions governing the Match Agreement and the arbitrator’s rights and responsibilities
thereunder.
To be sure, the sentence— “[t]he arbitrator shall not have the power to make an award
that is inconsistent . . . with District of Columbia substantive law,” Dkt. 5-2 at 35 (emphasis
added)—arguably comes closer to incorporating the DCRAA than the language in Equitas
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Disability Advocates, LLC, because it extends to the arbitration proceedings and not just “[the
parties’] substantive rights and obligations” under the Match Agreement. 177 F. Supp. 3d at
209. But the language still falls short of dictating that D.C. law applies to “the procedures for
enforcing or vacating a future arbitration award;” it speaks only to “the rights and obligations” of
the arbitrator in the course of the arbitration. Id. (emphasis added). And, contrary to NRMP’s
assertion, Dkt. 20 at 10–11, the language is not sufficiently analogous to the provision in
Foulger-Pratt Residential Contracting, LLC v. Madrigal Condominiums, LLC, 779 F. Supp. 2d
100 (D.D.C. 2011), which the Court found to properly incorporate D.C. Code § 16-4426(b). See
id. at 110. There, the parties specified: “[t]his [a]greement to arbitrate shall be specifically
enforceable pursuant to and interpreted under the laws of the District of Columbia.” Id.
(emphasis added). That differs in a dispositive respect from the language here, which does not
cover the enforcement of the arbitration award.
The Court, accordingly, concludes that the Match Agreement does not constrain the
Court from adjudicating this action.
CONCLUSION
For the foregoing reasons, Plaintiff’s motion to remand, Dkt. 7, is hereby DENIED.
SO ORDERED.
/s/ Randolph D. Moss
RANDOLPH D. MOSS
United States District Judge
Date: September 26, 2017
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