
USCA1 Opinion

	




                            United States Court of Appeals                            United States Court of Appeals                                For the First Circuit                                For the First Circuit                                 ____________________        No. 92-1904                         COMMERCIAL UNION INSURANCE COMPANY,                                Plaintiff, Appellant,                                          v.                              GILBANE BUILDING COMPANY,                                 Defendant, Appellee.                                 ____________________                     APPEAL FROM THE UNITED STATES DISTRICT COURT                          FOR THE DISTRICT OF MASSACHUSETTS                  [Judge Edward F. Harrington, U.S. District Judge]                                 ____________________                                        Before                               Torruella, Circuit Judge,                                          _____________                            Bownes, Senior Circuit Judge,                                    ____________________                              and Stahl, Circuit Judge.                                         _____________                                 ____________________            Michael P. Duffy, with  whom Bert J. Capone, John J. O'Connor, and            ________________             ______________  ________________        Peabody & Arnold, were on brief for appellant.        ________________            Peter B. Krupp, with  whom Thomas R. Murtagh, Joseph P.  Crawford-            ______________             _________________  ____________________        Kelly, and Mintz,  Levin, Cohn, Ferris, Glovsky and  Popeo, P.C., were        _____      _____________________________________________________        on brief for appellee.                                 ____________________                                     May 11, 1993                                 ___________________                      STAHL, Circuit  Judge.  In this  appeal, plaintiff-                             ______________            appellant   Commercial   Union   Insurance   Company   ("CU")            challenges  the district court's summary denial of its motion            to   stay  defendant-appellee   Gilbane  Building   Company's            ("Gilbane") counterclaim pending arbitration.  Finding  error            in the district court's decision, we reverse.                                          I.                                          I.                                          __                                  Factual Background                                  Factual Background                                  __________________                      During  the latter half  of the 1980's,  Gilbane, a            general contractor,  entered into thirteen  subcontracts with            Thames Valley  Steel Corporation ("TVS"),  a structural steel            subcontractor, under which  TVS agreed to  perform structural            steel  work  for  Gilbane on  thirteen  separate construction            projects in Massachusetts and Rhode Island.  On each project,            CU  acted as  surety for  TVS,  issuing various  performance,            labor, and material bonds guarantying TVS's proper completion            of  its  obligations.     As  such,  each  of  the   thirteen            construction  projects   was  governed  by   at  least  three            contracts: (1)  the prime  contract between  Gilbane and  the            individual  owner; (2)  the subcontract  between  Gilbane and            TVS; and (3) CU's performance bond.                       In  1990, TVS  ceased  doing  business  and,  as  a            result,  defaulted on  its  obligations  under  each  of  the            thirteen  subcontracts.  Disputes  then arose between  CU and            Gilbane  concerning CU's obligations as the guarantor of TVS'                                         -2-                                          2            performance  on  these projects.    On  August  16, 1991,  CU            commenced this diversity action against Gilbane alleging that            Gilbane wrongfully  withheld  contract balances  owed  CU  in            connection   with  the   completion   of  the   first  twelve            construction  projects.  In  its answer, Gilbane  denied CU's            allegations  and also brought  a two-count counterclaim.   In            Count  I  of  its  counterclaim,  Gilbane  alleged  that,  in            relation to the thirteenth construction project, TVS breached            the terms of its subcontract by failing to perform in  a good            and workmanlike manner, and that CU breached the terms of its            performance bond by  failing to correct TVS' work.   In Count            II,  Gilbane charged that  CU committed unfair  and deceptive            trade practices in violation of Mass. Gen. Laws Ann. ch. 93A,               2 and 11 (West  1984 and Supp. 1992) (hereinafter referred            to   simply  as  "ch.  93A"),  and  unfair  claim  settlement            practices in  violation of Mass.  Gen. Laws Ann. ch.  176D,              3(9) (West 1987 and Supp.  1992), by failing "to effectuate a            prompt, fair and equitable settlement of Gilbane's claims . .            . ."                      In response to Gilbane's  counterclaim, CU filed  a            reply denying any liability in connection with the thirteenth            project and  amended its  complaint to  add a  count alleging            that Gilbane committed  unfair and deceptive trade  practices            in  violation of ch. 93A  by withholding an undisputed amount            "solely in order  to gain leverage with respect  to a dispute                                         -3-                                          3            arising in  connection with  a different project."   At  that            time,  CU also  filed  a  third-party  complaint  against  L.            Antonelli  Iron Works and  The Thompson and  Lichter Company,            Inc., both of whom had  entered into subcontracts with TVS to            perform  certain services  in connection with  the thirteenth            construction project.  In that complaint, CU alleged that the            third-party  defendants were  liable to  CU  for any  amounts            Gilbane  might  recover  against   CU  on  Count  I  of   its            counterclaim.                      On November 6, 1991, CU filed the instant motion to            stay Gilbane's counterclaim pending arbitration, arguing that            the  counterclaim  was  subject  to  an  express  arbitration            agreement.1  Gilbane  opposed the motion to  stay, contending            that  the  counterclaim  was not  subject  to  an arbitration            agreement, and  in the  alternative, that  CU had waived  its            right to arbitrate by filing the instant lawsuit.  On May 18,            1992, the  district court entered a margin order denying CU's            motion to stay.  CU appeals from that decision.                                         II.                                         II.                                         ___                                            ____________________            1.  We think  it important to  emphasize that Count I  of the            counterclaim  concerns   only  the   thirteenth  construction            project.  The other twelve  projects, which are the basis for            the complaint  by CU against  Gilbane, are not  implicated in            the counterclaim.  The counterclaim, therefore, can be viewed            as separate  and distinct from  the complaint  brought by  CU            against  Gilbane.   Neither  party  has  suggested  that  the            dispute as to  the twelve other construction  projects, which            form   the  basis  for   CU's  complaint,  be   submitted  to            arbitration.                                         -4-                                          4                                      Discussion                                      Discussion                                      __________                      Although  not  raised  by  the  parties,  we  first            explain the  basis of our appellate jurisdiction.   Section 3            of the Federal  Arbitration Act ("FAA") contains  a procedure            by  which parties  to  an arbitration  agreement  may file  a            motion  to  stay  the  trial  of  arbitrable  claims  pending            arbitration.   See 9 U.S.C.A.    3 (West 1970).   Pursuant to                           ___            that section of the statute,  a district court must grant the            stay "upon  being satisfied that the issue  involved . . . is            referable to  arbitration under  such an agreement  . .  . ."            The FAA further provides that  "[a]n appeal may be taken from            . . . an order . . . refusing a stay under  section 3 of this            title .  . . ."  9 U.S.C.A.    16(a)(1)(A) (West Supp. 1992).            As CU is  appealing from a denial  of a motion to  stay under            section  3   of  the   FAA,  we   therefore  have   appellate            jurisdiction.            A.  Arbitrability            A.  Arbitrability            _________________                      The  arbitrability of  this  dispute turns  on  the            interpretation  of contractual terms, a question of law which            we can determine  in the first instance.   See, e.g., Fashion                                                       ___  ____  _______            House, Inc. v.  K Mart Corp., 892  F.2d 1076, 1083  (1st Cir.            ___________     ____________            1989).            1.  Relevant Contract Language            1.  Relevant Contract Language            ______________________________                      Gilbane's counterclaim is  based upon CU's  alleged            breach  of its  performance bond  on  the thirteenth  project                                         -5-                                          5            ("the  Performance Bond").   Thus, the arbitrability  of this            counterclaim depends upon  whether there is language  in that            contract  subjecting  disputes  between  Gilbane  and  CU  to            arbitration.                        Although  the  Performance  Bond  has  no  language            dealing   with  arbitration,   it  does   contain   a  clause            incorporating the  subcontract between Gilbane and  TVS ("the            Subcontract"), which, in turn, has a clause incorporating the            prime  contract  between   Gilbane  and  the  owner   of  the            thirteenth project ("the  Prime Contract").  It is  the Prime            Contract that contains  the arbitration clause.   That clause            reads as follows:                           All  claims,   disputes  and   other                      matters in  question arising  out of,  or                      relating to this Agreement or the  breach                      thereof,  .  .  .  shall  be  decided  by                      arbitration   in   accordance   with  the                      Construction  Industry Arbitration  Rules                      of the  American Arbitration  Association                      then   obtaining   unless   the   parties                      mutually agree otherwise.  This agreement                      to   arbitrate   shall   be  specifically                      enforceable    under    the    prevailing                      arbitration law by a three-member panel.                      The  Subcontract,  which  was  drafted by  Gilbane,            contains a  clause  incorporating certain  provisions of  the            Prime Contract:                           [Gilbane] shall be bound to [TVS] by                      the  terms of  this  agre[e]ment, to  the                      extent   that  the   provisions  of   the                      contract documents between  the owner and                      [Gilbane] apply  to the work of  [TVS] as                      defined in  this agreement[.]   [Gilbane]                      shall   assume  toward   [TVS]  all   the                                         -6-                                          6                      obligations and responsibilities that the                      owner, by those documents, assumes toward                      [Gilbane].    [Gilbane]  shall  have  the                      benefit  of  all  rights,  remedies,  and                      redress against [TVS] which the owner, by                      those documents, has against [Gilbane]. .                      . .2                      Finally,  the   Performance  Bond   has  a   clause            incorporating the  Subcontract by reference:  "Whereas, [TVS]            has by written  agreement . . . entered  into a [S]ubcontract            with [Gilbane] . . . which [S]ubcontract is by reference made            a part hereof . . . ."            2.  Relevant Law            2.  Relevant Law            ________________                      In  deciding  whether  a  chain  of   incorporation            rendering  Gilbane's  counterclaim arbitrable  exists  within            these three contracts,  we are mindful of  the strong federal            policy  favoring  arbitration  agreements,  a  policy   which            requires us to resolve  "any doubts" concerning arbitrability            in favor of arbitration.  See Moses H. Cone Memorial Hosp. v.                                      ___ ____________________________            Mercury Constr. Corp., 460 U.S. 1, 24-25 (1983).   See also J            _____________________                              ___ ____ _            & S  Constr. Co., Inc. v. Travelers Indem. Co., 520 F.2d 809,            ______________________    ____________________            810 (1st Cir.  1975) (construing incorporation language  in a            subcontract  broadly  in  light   of  "the  policy   favoring            arbitration").  This  policy applies "whether the  problem at            hand is the  construction of the contract  language itself or                                            ____________________            2.  The subcontract  defines "contract documents"  to include            "the  agreement  between   the  owner   and  [Gilbane],   the            conditions  of the agreement between the owner and [Gilbane],            general   conditions,   supplementary,  special   and   other            conditions . . . ."                                         -7-                                          7            an  allegation  of  waiver,  delay,  or  a  like  defense  to            arbitrability."  Moses H. Cone, 460 U.S. at 25.                             _____________                      In a  remarkably  similar case,  the Sixth  Circuit            held that  a chain of  incorporation running through  a prime            contract,  a  subcontract, and  a  performance bond  rendered            disputes  under the  performance bond  subject  to the  prime            contract's arbitration  clause.   Exchange Mut.  Ins. Co.  v.                                              _______________________            Haskell Co., 742 F.2d 274, 275-76  (6th Cir. 1984).  Like the            ___________            Performance Bond at issue here, the bond in that case did not            itself  contain an arbitration  clause.  Rather,  the bond in            Haskell incorporated the subcontract by reference, (employing            _______            incorporation  language  almost  identical  to that  involved            here), which,  in turn,  incorporated the  prime contract  by            reference.  Id.  The incorporation clause in that subcontract                        ___            read  as follows:   "Subcontractor  hereby  assumes the  same            obligations   and  responsibilities   with  respect   to  his            performance under  this Subcontract, that  Contractor assumes            towards Owner with respect to his  performance on the [prime]            [c]ontract."   Id.  at 275.   The  prime contract  in Haskell                           ___                                    _______            contained an arbitration provision  almost identical to  that            in the Prime Contract at issue here.  Id.                                                    ___                      Without reference  to the federal  policy requiring            it  to construe  any  doubts in  favor of  arbitrability, the            Sixth Circuit  nevertheless reasoned  that the  incorporation                                         -8-                                          8            language  in the performance  bond and subcontract  was broad            enough to include the prime contract's arbitration agreement:                           Here,    the    performance     bond                      specifically referred to and incorporated                      the   subcontract.      The   subcontract                      provides  that the  same obligations  and                      responsibilities apply in the subcontract                      as apply in  the [prime] contract.   And,                      finally,  the  [prime]  contract provides                      that there is a duty to arbitrate.  Thus,                      the  performance  bond   incorporates  by                      reference     the     subcontract,    the                      subcontract incorporates by reference the                      [prime] contract[,] and hence[,] the duty                      to arbitrate.            Id. at 276 (relying on J & S Constr., 520 F.2d at 810).            ___                    _____________                      If  anything,  the  language  in  the   Subcontract            incorporating the terms of the Prime Contract is even broader            than  that in  the  Haskell  subcontract.    The  Subcontract                                _______            provides that, to the extent the Prime Contract (with all its            attendant conditions)  applies to  the work  of TVS,  Gilbane            "shall   assume   toward  [TVS]   all  the   obligations  and                                              ___            responsibilities" that the owner assumed toward Gilbane under            the  Prime  Contract.   (Emphasis  added).    The Subcontract            further  states that "[Gilbane] shall have the benefit of all            rights,  remedies, and redress against [TVS] which the owner,            by [the  contract documents],  has against  [Gilbane]."   The            parties  do not  dispute that  one of  the obligations  which            Gilbane assumed toward the owner under the Prime Contract was            to  submit  all disputes  arising  out  of  the  contract  to            arbitration.  Nor do they dispute that the bundle of "rights,                                         -9-                                          9            remedies,  and redress"  given  the  owner  under  the  Prime            Contract included the right to  submit all claims relating to            that contract to arbitration.  Accordingly, we find that  the            Subcontract bound  Gilbane to arbitrate  disputes relating to            the work  of TVS.3   Because the Performance  Bond explicitly            incorporated  by reference the  terms of the  Subcontract, we            further find that  Gilbane and CU similarly  bound themselves            to  submit disputes  arising under  the  Performance Bond  to                                            ____________________            3.  In  support of  its contention  that the language  in the            Subcontract  should be read  narrowly, Gilbane points  to the            clause  in that  contract  expressly  granting  Gilbane  "the            benefits of all  rights, remedies, and redress  against [TVS]            which  the  owner,  by  [the  Prime  Contract],  has  against            [Gilbane]."    Because  the Subcontract  does  not  contain a            parallel  clause expressly granting  TVS "the benefit  of all            rights,  remedies,  and redress"  under  the Prime  Contract,            Gilbane contends that  the parties did not intend  for TVS to            have the same right  to subject disputes under this  contract            to arbitration.  We do not agree.                 First, this argument  ignores the immediately  preceding            clause which states  that Gilbane "shall assume  toward [TVS]            all the obligations  and responsibilities that the  owner, by            [the Prime Contract],  has against [Gilbane]."   As explained            above, we  interpret this clause  to impose upon  Gilbane the            duty  to arbitrate  "all  disputes  relating  to  [the  Prime            Contract],"  an obligation  assumed by  the  owner under  the            Prime Contract.   Second, adopting Gilbane's  cramped reading            of this language would run  counter to the clearly enunciated            federal policy  of interpreting  "any doubts"  in contractual            language in favor of arbitration.  Moses H. Cone, 460 U.S. at                                               _____________            24-25.   Finally, because Gilbane drafted the subcontract, we            construe  any ambiguities in that  contract against it.  See,                                                                     ___            e.g., LFC Lessors,  Inc. v. Pacific Sewer  Maintenance Corp.,            ____  __________________    ________________________________            739 F.2d 4, 7 (1st Cir. 1984).                                           -10-                                          10            arbitration.  To  the  extent that  the  district  court held            otherwise, we reverse.4            B.  Waiver            B.  Waiver            __________                      Gilbane alternatively  contends that,  even if  the            counterclaim  is arbitrable, CU waived its right to arbitrate            that  claim based  upon its  pretrial  participation in  this            lawsuit.  This contention we find meritless.                      In  deciding  this  issue,  we  first  discuss  the            appropriate  standard of  review.    As  the  district  court            decided the arbitrability  question by margin order,  we have            no  predicate factual  findings to  review.   In fact,  it is            possible that the  district court did not  reach the question            of waiver but decided against  CU solely on the basis of  its                                            ____________________            4.  To support its position that the district court's refusal            to grant the  stay was correct, Gilbane relies  upon a series            of cases which,  it asserts, stand  for the proposition  that            prime  contract provisions  unrelated  to  the  work  of  the            subcontractor  are  not  incorporated  by  reference  into  a            subcontract.   See Washington  Metro. Area  Transit Auth.  v.                           ___ ______________________________________            Norair Eng'g  Corp., 553 F.2d  233, 235-36 (D.C.  Cir. 1977);            ___________________            John W.  Johnson, Inc. v.  Basic Constr. Co., Inc.,  429 F.2d            ______________________     _______________________            764,  774-75 (D.C. Cir. 1970);  United States v. Fryd Constr.                                            _____________    ____________            Corp., 423  F.2d 980,  983-84 (5th  Cir.), cert.  denied, 400            _____                                      _____  ______            U.S. 820 (1970); United States Steel Corp.  v. Turner Constr.                             _________________________     ______________            Co., 560 F. Supp. 871, 873-74 (S.D.N.Y. 1983).  None of these            ___            cases, however, involved the  incorporation of an arbitration            clause.  Indeed, in  one of the cases relied upon by Gilbane,            the   court   explicitly    distinguished   cases   involving            arbitration clauses  as invoking the  "congressional policies            favoring arbitration  . .  . ."   See Washington  Metro., 553                                              ___ __________________            F.2d at 236.  In  light of Haskell, a case on all  fours with                                       _______            this one, we find Gilbane's  reliance upon this line of cases            unpersuasive.                                          -11-                                          11            interpretation  of the contractual  language.  In  any event,            the  facts  concerning  CU's  pretrial participation  in  the            lawsuit are undisputed.  As  a result, the question of waiver            is one  of  law, and  we review  it  de novo.   See  Page  v.                                                 __ ____    ___  ____            Moseley,  Hallgarten, Estabrook & Weeden, Inc., 806 F.2d 291,            ______________________________________________            294 n.2 (1st Cir. 1986),  overruled on other grounds sub nom.                                      _________ __ _____ _______ ___ ____            Shearson/American  Express, Inc.  v.  McMahon,  482 U.S.  220            ________________________________      _______            (1987).                        In deference to the  policies favoring arbitration,            "courts have  stated  that  `waiver  is  not  to  be  lightly            inferred,  and mere delay in seeking arbitration without some            resultant prejudice to  a party cannot carry the  day.'"  See                                                                      ___            id. at 293 (quoting  Rush v. Oppenheimer & Co., 779 F.2d 885,            ___                  ____    _________________            887  (2d Cir.  1985)).   See also  Sevinor v.  Merrill Lynch,                                     ___ ____  _______     ______________            Pierce, Fenner & Smith, Inc., 807 F.2d 16, 19 (1st Cir. 1986)            ____________________________            ("In  order  for  plaintiffs  to prevail  on  their  claim of            waiver, they must show prejudice.");  J & S Constr., 520 F.2d                                                  _____________            at  809-10 (upholding district  court's finding of  no waiver            where there had been "no showing of prejudice").                       Although  Gilbane made no claim below that it would            be prejudiced  by a stay  of its counterclaim, it  asserts on            appeal that it would suffer  prejudice on two bases: (1) that            it could  not properly "defend"  Count I (the  contract claim            for  amounts  allegedly owed  CU  on twelve  of  the thirteen            construction  projects) and  Count II  (CU's  ch. 93A  claim)                                         -12-                                          12            without its  counterclaim; and  (2) that it  would be  forced            into duplicative litigation.  We discuss these contentions in            turn.                        Gilbane first argues that it would suffer prejudice            from  having to  defend  against Count  I  of CU's  complaint            without its  counterclaim.   Accepting this contention  would            require, in essence, a finding that the thirteen construction            projects are factually inseparable.   This is simply not  the            case.   Suppose, for instance, that the counterclaim proceeds            to arbitration  and is  decided in Gilbane's  favor.   Assume            further that  the underlying lawsuit  results in an  award to            CU.  Under that scenario,  the arbitration award could act as            a stipulated  setoff from the  amount awarded CU  in district            court.5    We are  unable  to  imagine  a scenario  in  which            Gilbane would suffer  prejudice from having to defend Count I            of  CU's  complaint  in the  underlying  lawsuit  without its            counterclaim.   Nor has  Gilbane outlined  such a  scenario.6                                            ____________________            5.  We note that  Gilbane's attorney conceded as  much during            oral argument.            6.  Gilbane  also  argues   that,  because  it   pleaded  the            substance  of its counterclaim  as an affirmative  defense in            its  answer  to  the  complaint, it  should  be  permitted to            litigate  the substance  of  that  claim  in  the  underlying            action.  Whether  we characterize the substance  of Gilbane's            claim as  a "counterclaim"  or a  "setoff defense,"  however,            makes no difference  for the purposes of  determining whether            Gilbane  will theoretically be prejudiced by severing it from                                           __________            the  underlying lawsuit.  Second, and more important, Gilbane            is, in our opinion, relying upon creative pleading to make an            end run around an arbitration  agreement.  We have previously            rejected a  party's reliance upon procedural  gamesmanship to                                         -13-                                          13            We therefore  find unpersuasive  its belated  contention that            one might exist.                      Gilbane also asserts that it would suffer prejudice            by  having  to defend  against  Count  II of  CU's  complaint            without  its  counterclaim.   Again,  Gilbane  has  failed to            provide an example of how it might be prejudiced.  It appears                                  ___            to  be  arguing,   instead,  that  it  would   be  judicially            inefficient to litigate  CU's ch. 93A claim in  one forum and            Gilbane's ch.  93A claim in  another.7  While Gilbane  may be            correct,   we  fail  to   see  how  any   resulting  judicial            inefficiency would prejudice  Gilbane.8   Cf.  Page, 806 F.2d                                                      ___  ____                                            ____________________            avoid the  dictates of an arbitration agreement.   Cf. Hilti,                                                               ___ ______            Inc. v. Oldach,  392 F.2d 368,  373 n.2 (1st Cir.  1968) ("If            ____    ______            arbitration  defenses could be foreclosed [by creative use of            the joinder rules], the  utility of such agreements  would be            seriously compromised.").  We do so again today.            7.  At one point  in its brief, Gilbane states  that it would            "be at risk  of inconsistent verdicts .  . . ."   Gilbane has            not,   however,  offered   either  an  explanation   of  this            perfunctory assertion or an example of a scenario in which it            could occur.   As such,  we do not  address it further.   See                                                                      ___            United States v. St. Cyr,  977 F.2d 698, 701 (1st Cir.  1992)            _____________    _______            (reiterating well settled rule in this circuit that arguments            adverted to on appeal in "a perfunctory manner, unaccompanied            by some developed argumentation," are deemed waived) (quoting            Ryan v.  Royal Ins. Co.  of America,  916 F.2d 731,  734 (1st            ____     __________________________            Cir. 1990)).             8.  In  any event, considerations  of judicial efficiency are            not  a  sufficient  basis on  which  to  affirm  the district            court's denial  of the  motion to stay.   See,  e.g., Seguros                                                      ___   ____  _______            Banvenez, S.A. v. S/S Oliver  Drescher, 761 F.2d 855, 862 (2d            ______________    ____________________            Cir. 1985) (holding that a  court "may not refuse to grant  a            stay [of a claim pending arbitration] based on considerations            of  judicial economy");  Surman  v.  Merrill  Lynch,  Pierce,                                     ______      ________________________            Fenner &  Smith, 733 F.2d  59, 63 (8th Cir.  1984) (similar);            _______________            Dickinson  v. Heinold Sec.,  Inc., 661 F.2d  638, 644-45 (7th            _________     ___________________                                         -14-                                          14            at  294-95 (finding  no prejudice  despite plaintiffs'  claim            that compelled arbitration  would force them to  "restart the            entire [pretrial preparation] process before a  new tribunal"            almost two years after complaint was filed).                        Gilbane  also argues that it would suffer prejudice            by  having  to  litigate  the  same  facts  in  two  separate            proceedings, and having "to incur increased costs as a result            of having to proceed in two  arenas."  This argument rests on            the  faulty premise that  litigation of the  counterclaim and            CU's underlying  claims  would require  the  adjudication  of            "identical  factual and legal  issues." See supra  pp. 11-12.                                                    ___ _____            Moreover,  any  added  costs  that  Gilbane  would  incur  to            arbitrate its counterclaim were bargained for by Gilbane.  As            such, Gilbane's  final attempt to  persuade us  that it  will            suffer undue prejudice falls well short of the mark.                                         III.                                         III.                                         ____                                      Conclusion                                      Conclusion                                      __________                      In  sum, we  find  that Gilbane's  counterclaim was            subject to an express agreement to arbitrate, and that CU did            not waive its right to arbitrate that claim.  Accordingly, we            reverse the district  court's denial of  CU's motion to  stay            Gilbane's  counterclaim pending  arbitration  and remand  for            proceedings consistent with this opinion.                      Reversed and remanded.  No costs.                       Reversed and remanded.  No costs.                      _________________________________                                            ____________________            Cir. 1981) (similar).                                         -15-                                          15
