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BDO USA LLP v. Coe

To the extent O.C.G.A. § 9-9-6 subsection a controls whether a Georgia court is the appropriate forum for pursuing a motion to compel arbitration, it is not preempted by the Federal Arbitration Act.

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BDO USA, LLP, f/k/a BDO Seidman, LLP and Michael Whitacre collectively, “BDO” filed a petition in the Superior Court of Fulton County to compel arbitration of its disputes with Douglas Coe, Jacqueline Coe, GFLIRB, LLC, DBICHA, LLC, and ALAKE, LLC collectively, “Coe”. Following a hearing on Coe’s motion to dismiss, the trial court found that the issues that BDO claimed to be arbitrable were then pending before an Illinois court which had jurisdiction to hear a motion to compel arbitration and, therefore, in light of OCGA § 9-9-6 a, it lacked subject matter jurisdiction to consider the merits of BDO’s petition. Accordingly, the trial court dismissed BDO’s petition without prejudice. On appeal, BDO contends that the trial court had jurisdiction to consider BDO’s petition to compel arbitration under the Federal Arbitration Act, 9 USC § 1 et seq. “FAA”, which it claims preempted OCGA § 9-9-6 a. For the reasons that follow, we affirm.

BDO’s petition, in pertinent part, alleges that BDO provided tax consulting services to Douglas Coe pursuant to at least four written consulting agreements. In 2001 and 2002, Coe entered into a “distressed debt” tax shelter and then claimed deductions on 2001-2007 tax returns for artificial losses generated by the tax shelter. The Internal Revenue Service disallowed the deductions and imposed back taxes, interest, and penalties against Coe.

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