A recently filed case in the US Court of Appeals 8th Circuit regarding Timothy Parker and Parker Law Firm has been forced into arbitration. Seeking leave to litigate, the appeals court determined that the dispute in question was addressed by the arbitration clause in the formal agreement between parties.
An LFJ Conversation with Michael Kelley, Partner, Parker Poe
A recently filed case in the US Court of Appeals 8th Circuit regarding Timothy Parker and Parker Law Firm has been forced into arbitration. Seeking leave to litigate, the appeals court determined that the dispute in question was addressed by the arbitration clause in the formal agreement between parties.
Leagle details that the case in question is one part of a battle over whether Parker Law Firm was obligated to remit payments to litigation funder PS Finance LLC. The disagreement stemmed from Parker Law Firm’s representation of Eureka Woodworks. Eureka sought funding from PS Finance in exchange for proceeds from a claim against BP relating to the Deepwater Horizon spill. As is common in funding contracts, the agreement affirmed that PS Finance would be paid from monies received via settlement, verdict, or ordered judgment. The contract further detailed that any disputes relating to the contract would be subject to binding arbitration. Hence, the court ruling to disallow litigation.
Appellants recovered two payments in 2012 on behalf of Eureka. According to the contract, PS Finance should have received a portion of the payment after legal fees and costs. However, no portion of the payment was given to PS Finance. Parker and the law firm maintain that the money did not come from a settlement, verdict, or judgment and therefore they are not required to transfer any funds over.
In 2019, Parker and Parker Law sought a declaratory judgment affirming that they owed nothing to PS Finance. Parker made allegations that PS Finance breached its contractual obligations when it brought a lawsuit against Parker. The district court dismissed claims against PS Finance.
Arkansas law regarding policy interpretation is firmly on the side of policyholders. It states that when language is ambiguous, courts will construe the policy dictates in favor of the policyholder and against the insurer.
