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WBO Opposition Brief
WBO Opposition Brief
COMES NOW, Organización Mundial de Boxeo, Inc. (hereinafter, “WBO”, by its English
acronym), by and through its undersigned counsel and very respectfully states, alleges and prays
as follows:
I. PRELIMINARY STATEMENT
On November 9, 2020, Plaintiff Austin Trout (“Trout”) filed a Brief in Compliance with
Order (“Plaintiff’s Brief”). (Docket No. 94) In it, he argues that an arbitrator selection provision
in WBO’s Appeal Regulations is not severable from the rest of the arbitration clauses because it
does not contain a savings clause. According to Trout, this absence of a savings clause in the
Appeal Regulations forecloses the arbitration of the case. As discussed below, Trout’s position is
First, Trout’s analysis is extremely narrow. As discussed in detail below, he only focuses
on the absence of a savings clause in the WBO’s Appeal Regulations, but turns a blind eye to the
WBO’s Championship Regulations. Even though he argues that the arbitrator selection provision
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is not severable from the Appeal Regulations because they do not contain a savings clause, Trout
fails to consider that the WBO’s Championship Regulations have their own arbitration clause
and―as explained by the First Circuit―contain a savings clause. In this respect, Trout fails to
address the relationship between the Championship Regulations and the Appeal Regulations.
Indeed, there is an interplay between the two sets of applicable regulations, both of which have
their own arbitration provisions. As explained in WBO’s brief (Docket No. 93), the arbitration
clause in Section 35(e) the Championship Regulations is supplemented by the auxiliary arbitration
provisions incorporated by reference from the Appeal Regulations. Because there are two sets of
regulations―one incorporated by reference into the other―they can operate jointly (or even
from the auxiliary Appeal Regulations is severable pursuant to: a) the savings clause in Section 36
of the Championship Regulations, and b) the vast caselaw cited by the WBO in its brief supporting
the severability of the arbitrator selection provisions within arbitration clauses, with or without a
savings clause.1
Second, Trout’s analysis is not only erroneous, but his brief is devoid of relevant and
applicable case law. Indeed, this Honorable Court’s Order issued on October 7, 2020 required each
party to file a brief, including relevant caselaw, discussing whether the arbitrator selection clause
contained in the WBO’s Appeal Regulations is severable from the remainder of the arbitration
agreement between the parties. (Docket No. 92 and 94). Plaintiff’s Brief failed to cite relevant
caselaw regarding the severability of an arbitrator selection clause. Instead, Plaintiff’s Brief is
1
In the alternative, even if the auxiliary arbitrator selection provision is not severable from the rest of the Appeal
Regulations (which we deny) and the whole Appeal Regulations is deemed invalid, the main arbitration clause from
Section 35(e) the Championship Regulations is still enforceable by itself, pursuant to the savings clause from its
Section 36.
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based on: 1) inapplicable, out-of-context, and distorted arguments based on caselaw regarding
covenants not to compete; 2) a judgment without a majority opinion from the Puerto Rico Supreme
Court that has no binding precedential value and is inapplicable to the controversy at hand; 3) the
caselaw he cited was drafted in Spanish language and without providing a certified English
translation, thereby, violating this District’s Local Rules; and 4) a law journal article that is actually
detrimental to Trout’s contention as it supports WBO’s position that the Court has authority to
None of the legal authorities cited by Trout deal with the severability of arbitrator-selection
clauses. Instead, the caselaw he cites discusses the validity and requirements of covenants not to
compete in employment agreements. In other words, the caselaw cited by Trout is framed within
the context of employee-employer relationships, which are governed by particular public policy
considerations. Trout is not a WBO employee and the controversy at hand is not based on a
covenant not to compete. Therefore, contrary to Trout’s contention, Plaintiff’s Brief fails to cite
ungrounded as the handful of authorities cited in Plaintiff’s Brief do not support his conclusion.
In contrast, the WBO’s brief (Docket No. 93) is supported by on-point caselaw and other
supporting authorities that establish that, pursuant to Section 5 of the Federal Arbitration Act, 9
U.S.C. § 5, and its local counterpart, this Honorable Court has authority to sever an invalid
arbitrator-selection clause and appoint arbitrators if parties are unable to agree on the panel
selection process. Trout failed to address the ample on-point caselaw regarding the severability of
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II. ARGUMENT
The main argument in Plaintiff’s Brief is based on the existence of provisions “located in
two (2) separate WBO regulatory documents.” Plaintiff Brief, p. 4. These two regulatory
documents are the Appeal Regulations and the Championship Regulations. Trout argues that, since
the Appeal Regulations do not contain a savings clause, the arbitrator selection provision
invalidated by the First Circuit is not severable. He contends that the savings clause in the
Championship Regulations should not be extended to the Appeal Regulations. He reasons that if
the arbitrator selection clause is not severable from the rest of the arbitration provisions, arbitration
Trout is mistaken. In his brief, he failed to discuss the interplay between the Championship
Regulations and the Appeal Regulations. First, the WBO’s Championship Regulations contain a
total of 36 sections that govern a wide array of matters applicable to different aspects of the WBO’s
operations and fights, such as: the appointment of the World Championship Committee (Sec. 1);
weight categories (Sec. 3); title defenses (Sec. 5); purse bids (Sec. 11); sanctions (Sec. 16); ring
specifications (Sec. 22); referees (Sec. 24); count on fallen contestants (Sec. 25); weight of the
gloves (Sec. 30); and insurance (Sec. 33). It also contains a savings clause on Section 36 that states
that “[i]f any of these Rules are determined to be unenforceable, the balance of these Rules shall
All WBO participants acknowledge and agree that the mandatory resort to
the WBO Appeals Regulation is the sole and exclusive remedy for any claim,
appeal, grievance or contest that arises from any right or status that is or could
be subject to these Regulations or which results or could result from or relate
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(emphasis added).
Pursuant to the first sentence of Section 35(e), the Championship Regulations are
supplemented by the auxiliary Appeal Regulations, which were incorporated by reference into the
Championship Regulations. The Appeal Regulations provide a series of articles that are mostly
procedural, regarding various alternative dispute resolution mechanisms. Its Article 1 includes the
arbitrator selection provision that was invalidated by the First Circuit. Similar to the Championship
Regulations, the Appeal Regulations also contain its own arbitration clause on its Article 7, which
provides:
By incorporating by reference the Appeal Regulations, it is clear that its provisions are auxiliary
or supplemental to the main Championship Regulations, and, for that reason, both regulations can
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In this case, there is no question that, as mentioned in the First Circuit’s Opinion, Section
35(e) of the Championship Regulations requires the arbitration of the disputes and Section 36
contains a savings clause. The governing Section 35(e) is supplemented by the auxiliary Appeal
Regulations, which were incorporated by reference. Thus, pursuant to savings clause in the
since the arbitrator selection process of the Appeal Regulations is an auxiliary portion of the
Championship Regulations (incorporated by reference from the Appeal Regulations) was found
Although the discussion above is enough to sever the arbitrator selection provision from
the Appeal Regulations and order arbitration, there is another reason why arbitration is required.
Because each of the two regulations contains their own arbitration clauses, arbitration is required
by both (and either) of them. In other words, arbitration is required by Article 7 of the Appeal
Regulations and Section 35(e) of the Championship Regulations. Thus, even if the arbitrator
selection clause contained in Article 1 of the Appeal Regulations is unenforceable and non-
severable, which it is not, arbitration must still proceed pursuant to Section 35(e) of the
Championship Regulations.
On October 7, 2020, this Honorable Court ordered the parties to file a brief, including
relevant caselaw, discussing whether the arbitrator selection clause contained in the WBO’s rules
is severable from the remainder of the arbitration agreement between the parties. (Docket No. 92).
This Order was issued after the U.S. Court of Appeals for the First Circuit remanded the case to
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this Honorable Court to determine whether the savings clause in the WBO’s Championship
Regulations, Sec. 36, allows the arbitrator selection provision contained within Article 1 of the
WBO’s Appeal Regulations to be severed from the rest of the arbitration agreement between the
parties. Opinion, p. 21-23. The First Circuit explained that “[i]n determining whether ‘the
[arbitration agreement] should be enforced absent the invalid arbitrator selection-mechanism and,
if it should, how to select an arbitrator,’ however, we must consider ‘the parties’ intent,’ the
‘[f]ederal policy favoring arbitration,’ and ‘the interplay between state law and that federal
policy.’” Opinion, p. 22, quoting McMullen v. Meijer, Inc., 355 F.3d 485, 495 (6th Cir. 2004).
With this criteria in mind, the WBO filed its brief explaining and providing relevant
caselaw showing that―pursuant to the written regulations accepted by the parties and the federal
policy favoring arbitration―the parties’ intention was to promptly resolve their disputes in
arbitration, before a panel with knowledge and experience in world professional championship
boxing, following the Federal Arbitration Act (“FAA”) or its analogous counterpart, the
Arbitration Law of Puerto Rico. In its brief, the WBO argued inter alia that because the
and not central to the arbitration provisions, it is severable from the WBO’s arbitration clauses.
See Khan v. Dell Inc., 669 F.3d 350, 354 (3d Cir. 2012) (concluding that, to invalidate an
arbitration agreement, “the parties must have unambiguously express[] their intent not to arbitrate
their disputes in the event that the designated arbitral forum is unavailable.”); Ruiz v. Millennium
Square Residential Ass'n, 156 F. Supp. 3d 176, 183 (D.D.C. 2016) (holding that the
unenforceability of the arbitrator selection provision is severable, thus, does not doom the
arbitration agreement in its entirety). In fact, as discussed above, the arbitration provisions of the
WBO’s Championship Regulations can be invoked from the arbitrator selection provisions to
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compel arbitration and, therefore, can operate with or without the auxiliary arbitrator selection
clause incorporated by reference from Article 1 of the WBO’s Appeal Regulations. See Zechman
v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 742 F. Supp. 1359, 1365-1366 (N.D. Ill. 1990)
the parties ‒or, in the alternative, by the Court‒ after finding that the unenforceable arbitrator
Instead of addressing the issues head on with relevant caselaw regarding the severability
of arbitrator selection clauses, Trout’s brief opts for a bob and weave approach with inapposite
arguments and inapplicable caselaw. First, Trout argued that the doctrine of adhesion contracts
requires that any ambiguity in the interpretation of the WBO’s regulations should be interpreted
in favor of the party that did not participate in its drafting. Plaintiff’s Brief, p. 8, citing Santiago v.
Kodak Caribbean, Ltd., 129 D.P.R. 114 (1993). However, after searching for the case through its
citation, no Santiago case from 1993 was found at 129 D.P.R. 114. If, however, Trout refers to the
1992 decision of Santiago v. Kodak Caribbean, Ltd., 129 D.P.R. 763 (1992), Trout failed to
provide a certified English translation of the document and, thus, his argument should be discarded.
Nevertheless, the doctrine of adhesion contracts to which Trout refers is unavailing. Under
Article 1233 of the Puerto Rico Civil Code, “[i]f the terms of a contract are clear and leave no
doubt as to the intentions of the contracting parties, the literal sense of its stipulations shall be
observed.” 31 P.R. Laws Ann. § 3471. The doctrine of adhesion contracts in which the language
is interpreted against the drafter of the agreement is only available when the contractual provisions
in questions are unclear or ambiguous. See Torres v. Estado Libre Asociado de Puerto Rico, 130
D.P.R. 640, P.R. Offic. Trans., 1992 WL 811282 (1992) (holding that courts are not compelled to
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interpret clear and unambiguous clauses in an adhesion contracts in favor of a party.) In his brief,
Trout has conceded that “there is no ambiguity here” (Plaintiff’s Brief, p. 8), and he is not arguing
that there is any ambiguity in the arbitration clauses in question. Thus, the doctrine of adhesion
contracts is unavailable to Trout. Moreover, even if there were any doubts regarding arbitrability,
which there are none, the federal policy in favor of arbitration requires that courts interpret “‘any
doubts’ in contractual language in favor of arbitration.” Com. Union Ins. Co. v. Gilbane Bldg. Co.,
992 F.2d 386, 389 (n.3) (1st Cir. 1993), citing Moses H. Cone Memorial Hosp. v. Mercury Constr.
Corp., 460 U.S. 1, 24–25 (1983). Consequently, Trout cannot invoke the doctrine of adhesion of
Second, Trout moves on to argue that in Arthur Young v. Vega III, 159 D.P.R. 157 (1994),
the Puerto Rico Supreme Court “ruled on controversies like the one at hand” and “rejected
adopting the ‘blue pencil’ rule in Puerto Rico” to suggest that the severability of an unenforceable
contractual provision is not allowed in Puerto Rico. (Plaintiff’s Brief, p. 9). This statement misses
the mark. The Court in Arthur Young did not address the issue at hand which is the severability of
covenants not to compete in employment agreements are valid in Puerto Rico and established the
requisites for such covenants to be valid.2 In doing so, the Puerto Rico Supreme Court discussed
how this issue was addressed in the mainland common law jurisdictions and other civil law
jurisdictions such as Spain, Argentina, and Belgium. Id. at 168-174. In doing so, it mentioned the
2
In its Opinion, the Puerto Rico Supreme Court took into consideration particular public policy considerations of
protecting employee’s freedom of contract and the general public's freedom of choice to select a professional
accountant. Arthur Young & Co. v. Vega III, 136 D.P.R. 157, P.R. Offic. Trans. (n.20), 1994 WL 909262 (1994).
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blue pencil approach3 as well as other alternatives provided in common law. However, the Arthur
Young Court neither adopted nor rejected the blue pencil common law approach, as it relied on
Most importantly, Arthur Young deals with an entirely different controversy that has no
relevance to the case at hand. First, unlike Mr. Vega with regards to Arthur Young, Trout is not a
WBO employee and there is no employment agreement between them. Also, the controversy in
this case has nothing do with a covenant not to compete, which was the issue in Arthur Young.
And, there was no savings clause in play in the Arthur Young. Therefore, the Arthur Young Court
did not address whether a savings clause would have an effect on its decision. In contrast, the issue
at hand is based on the severability of an arbitrator selection clause with a savings clause, agreed
This is not the first time that this Honorable Court has the opportunity to address whether
the Arthur Young decision applies beyond non-compete covenants disputes. In Cherena v. Coors
Brewing Co., 20 F. Supp. 2d 282, 288 (D.P.R. 1998), this Honorable Court, in an opinion and
order by voice of then U.S. Magistrate Judge Justo Arenas, clarified that, while a non-competition
covenant is null and void pursuant to the Arthur Young precedent, only such clause is invalid,
while the non-disclosure clause is severable pursuant to a savings clause. See also Jiménez v.
Island Oasis Frozen Cocktail Co., Inc., CIV. 09-1748 GAG, 2010 WL 3719216, at *7 (D.P.R.
Sept. 14, 2010) (same). The First Circuit agreed with this Honorable Court’s decisions in Cherena
and Jiménez, and has rejected expanding―by analogy―the scope of the Arthur Young precedent.
See Soto v. State Indus. Products, Inc., 642 F.3d 67, 74 (1st Cir. 2011) (rejecting plaintiff’s
3
“A blue pencil approach allows modification of an unreasonable restrictive covenant and enforcement (at least
prospectively) of the modified version; however, the court may not draft its own language; it may only strike out
language included in the parties' written agreement.” 3 Callmann on Unfair Comp., Tr. & Mono. § 16:9 (4th Ed.)
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“invitation to expand the scope of Arthur Young to hold that continued employment cannot
The reason for not expanding the principle further is simple. None of the requisites
established in Arthur Young for non-compete covenants would apply to other contexts such as the
severability of arbitrator selection clauses. See Arthur Young, 136 D.P.R. 157, P.R. Offic. Trans.
(1994) (Explaining that “[i]n order to be reasonable, a noncompetition clause must meet the
following requirements: (1) it must be necessary to protect a legitimate interest of the employer,
(2) it must not impose undue hardship on the employee, (3) and it must not be exceedingly injurious
to the public. The following should also be considered: the area where the employee is prohibited
from competing, the duration of said restriction, the sort of clients he may not offer services to,
and the type of services he is barred from offering. It is also assumed that the noncompetition
agreement is incidental to an employment contract and that there was adequate consideration.”)
In addition, in Plaintiff’s Brief, Trout cited PACIV v. Pérez Rivera, 159 D.P.R. 523 (2003),
but failed to discuss or explain how it applies to the case. In any event, PACIV is also inapplicable
to the case at hand because it dealt with a covenant not to compete, not with the severability of
arbitration provisions. Also, in PACIV, the Puerto Rico Supreme Court issued a judgment
(sentencia) without a majority opinion, therefore, it does not have precedential value. See Rivera
Maldonado v. E.L.A., 119 D.P.R. 74, 19 P.R. Offic. Trans. 88, 94–95, 1987 WL 448304 (1987).
(“A judgment without a Court opinion, the publication of which has not been ordered by the Court,
but which has been published because one of the justices has certified a concurring, dissenting or
4
The PACIV decision was published because former Associate Justice Rebollo López issued a dissenting opinion.
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Then, Trout cited the State of Georgia Supreme Court decision of Rita v. Kot, 229 Ga. 314,
317 (1972), to again argue the application of the blue pencil doctrine in the context of covenants
not to compete. As explained above, the controversy at hand has nothing to do with a covenant not
to compete, therefore, Rita is inapplicable and irrelevant to this case. Even if Rita had any
relevancy to this case, which we deny, the majority of the Court failed to consider the application
of a savings clause. For that reason, Justice Jordan issued a dissenting opinion, joined by Chief
Justice Mobley and Presiding Justice Grice, explaining that “[t]he contract here contains a
severability clause and this court should not declare the entire agreement to be illegal merely
because one part of the agreement is overly broad with regard to geographic limits.” Id. at 319.
This supports the argument that, when there is a savings clause, even non-compete clauses can be
In sum, all three cases cited by Trout are inapplicable and, at best, distinguishable from the
case at hand as they all deal with the entirely different controversy of the validity of covenants not
to compete and not on the severability of an arbitrator selection provision with a savings clause.
In this regard, Trout failed to abide by this Honorable Court’s order that the parties cite to relevant
Devoid of supporting caselaw and in a last ditch attempt to avoid the severability of an
arbitration provision, Trout attempts to cites to a law journal article, namely: Imre S. Szalai, A
New Legal Framework for Employee and Consumer Arbitration Agreements, 19 Cardozo J.
Conflict Resol. 653 (2018). This Article fails to support Trout’s theory for two main reasons. First,
the Article discusses employment and consumer arbitration agreements and, since Trout is not an
employee or a consumer of the WBO, the Article in general is inapplicable. Second, the Article
does not mention nor discuss the effect of a savings clause on the severability of an arbitration
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provision and, therefore, provides no guidance on the effect of the savings clause in the
Championship Regulations.
In contrast, the Article cited by Trout actually supports the WBO’s argument that Section
5 of the FAA, 9 U.S.C. § 5, authorizes this Honorable Court to supplement the arbitration clause
by designating arbitrators to fill the gap left by the unenforceable Article 1 of the Appeal
Regulations.
Section 5 comes closest to an example of textual authority within the FAA for
a judge to rewrite or change the terms of the original agreement. However, the
circumstances triggering section 5 are very limited, and section 5 still does not
explicitly authorize severance of harsh terms. Suppose that a pre-dispute arbitration
agreement names a particular person, Arbitrator Art, to serve as an arbitrator, but
the arbitrator is deceased at the time a dispute arises in the future. In this situation,
if the parties cannot decide on an arbitrator to replace the deceased arbitrator, one
party may petition a court to designate and appoint a replacement arbitrator. In
effect, the court would sever the original term of the parties' agreement and
fill in the gap with the appointment of a different arbitrator pursuant to
section 5 of the FAA. Similarly, if the parties' original agreement failed to provide
a method for selecting an arbitrator, and if the parties cannot agree on a method
once a dispute arises, section 5 authorizes a judge to fill in the gap through the
appointment of an arbitrator. Section 5 appears to come the closest out of all the
Sections of the FAA to authorizing a court to change the terms of the parties, but it
is limited to the very specific context regarding the selection of an arbitrator.
It is clear that Section 5 of the FAA authorizes this Honorable Court to fill the gap in the
WBO’s regulations through the designation and appointment of arbitrators. The severability of the
arbitrator selection provision, by virtue of the savings clause and the caselaw, allows this
Honorable Court’s to enforce the arbitration clause following the parties’ unequivocal intent to
promptly arbitrate their disputes before knowledgeable and experienced individuals from the
boxing industry, pursuant to the local and federal arbitration acts. See Section 35(e) of the
Championship Regulations. This is particularly important because in the boxing industry, where
rankings and championships are at stake, it is essential for parties (and even for non-parties
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contestants) to solve the disputes in a prompt manner to avoid the uncertainty that a lengthy trial
may carry. Therefore, pursuant to the federal policy favoring arbitration, this case should be
dismissed and arbitration ordered. See Shearson/Am. Exp., Inc. v. McMahon, 482 U.S. 220, 226
(1987) (explaining that the Federal Arbitration Act (“FAA”) establishes a federal policy favoring
arbitration, which requires the courts to “rigorously enforce agreements to arbitrate.”); World
Films, Inc. v. Paramount Pict. Corp., 125 D.P.R. 352, 358-361, P.R. Offic. Trans., 1990 WL
657504 (1990) (explaining that there is a presumption of arbitrability and any doubt regarding the
WHEREFORE, the WBO respectfully requests that this Honorable Court to order the
parties to arbitrate the disputes at hand after each party provides a list of qualified arbitrators, each
party selects an arbitrator from those lists, and those arbitrators select a qualified and experienced
third arbitrator from an mutually agreeable list that would serve as the chairperson. In the
alternative or if the parties are unable to timely select the arbitrators, the WBO requests this
Honorable Court to name the panel members, pursuant to Sec. 5 of the FAA, 9 U.S.C. § 5. Lastly,
the WBO requests that the parties be bound by any and all enforceable and applicable portions of
the arbitration provisions contained in the WBO’s regulations that operate independently from the
RESPECTFULLY SUBMITTED.
WE HEREBY CERTIFY that on this same date we electronically filed the foregoing with
the Clerk of the Court using the CM/ECF system which will send notification of such filing to the
attorneys of record.
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PIETRANTONI MENDEZ & ALVAREZ LLC LAW OFFICES OF ANDREW W. HORN, P.A.
Popular Center, 19th Floor 2665 S. Bayshore Drive
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Tel. 787-274-1212 Tel. 305-373-7789
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