Following the denial of a preliminary injunction, Mark and Tammy Smith’s lawsuit against Neora and Jeff Olson is heading to arbitration.

In ruling against the Smiths, the California District Court found commenced arbitration proceedings in Texas had been “fully and fairly litigated”.

As the vigorous objections by the Smiths’ counsel at the evidentiary hearing reflect, the issue was fully litigated in the State court proceeding.

And while the Smiths argue that the issue was not fairly litigated, they offer no legal authority for their contention that overruled objections necessitate a finding of “unfair” litigation.

The court also ruled the Californian motion for a preliminary injunction involved “identical issues” previously litigated in Texas.

As to other arguments put forth by the Smiths against arbitration;

Since there is no longer a dispute of fact to be resolved with respect to the agreement to arbitration, the Smiths are unlikely to succeed on the merits and there are no serious questions going to the merits.

Thus, the Court need not consider the other factors and denies the motion for preliminary injunction.

Basically this is a win for Neora, as arbitration in Texas favors them over litigating in California.

The Californian District Court’s order denying the Smith a preliminary injunction was made on June 20th.

On June 27th Mark and Tammy Smith filed a motion for reconsideration of the order.

A decision on the Smiths’ reconsideration motion is pending.