Chapter 14 - § 14.4 • THE POWER OF COURTS TO GRANT INTERIM|PROVISIONAL RELIEF IN ARBITRATION

• Jurisdiction: Colorado

§ 14.4 • THE POWER OF COURTS TO GRANT INTERIM/PROVISIONAL RELIEF IN ARBITRATION

§ 14.4.1—Powers Under The FAA

The power of the federal courts at common law to enter interim relief to preserve the status quo pending the arbitration award generally has been recognized. For example, courts have enjoined former employees from soliciting customers.³⁰ Other examples include:

• The Federal Arbitration Act does not abrogate the district court's power to issue a preliminary injunction in an arbitrable dispute.³¹
• A district court may enter an injunction compelling specific performance so as to maintain the status quo pending arbitration.³²
• Once a court orders arbitration under FAA § 4, it is not stripped of authority to grant a writ of possession.³³
• The district court has authority to grant injunctive relief in an arbitrable dispute, provided that the traditional prerequisites for such relief are satisfied: (1) whether the movant has demonstrated reasonable probability of eventual success in the litigation; (2) whether the movant has demonstrated that it will be irreparably injured pendente lite if relief is not granted to prevent a change in the status quo; (3) the possibility of harm to other interested persons from the grant or denial of the injunction; and (4) public interest.³⁴
• Application granted for a status quo injunction pending a specific performance.³⁵

Most of these decisions do not discuss whether the application should be or may be considered by the arbitrator instead of the courts.

One court has held that only the federal district court in the judicial district where the arbitration is taking place may grant a preliminary injunction pending arbitration.³⁶ Again, however, apparently there must be an independent jurisdictional basis for the motion to be filed in a federal court.

The Tenth Circuit has affirmed the district court's issuance of a temporary restraining order and then a preliminary injunction preventing a former employee from using customer lists and soliciting customers until completion of arbitration. However, the court directed the district court to "modify the preliminary injunction to expire when the issue of preserving the status quo is presented to and considered by the arbitration panel."³⁷

On the other hand, in a few instances federal courts have concluded that they do not have the power under the FAA to enter injunctive relief.³⁸

§ 14.4.2—Powers Under The CUAA

While the Colorado Uniform Arbitration Act (CUAA) today is rarely applicable, decisions under it provide substantial guidance. Most state courts considering the issue under the CUAA, which is silent on the matter, have held that the court has power to grant interim or provisional relief in matters that will be arbitrated.³⁹ Usually, the relief is in the nature of an injunction to preserve the status quo pending arbitration.

Colorado has followed this consensus. For example, in Hughley v. Rocky Mountain Health Maintenance Organization, Inc.,⁴⁰ a health maintenance organization was ordered to continue to provide chemotherapy...