Provision Unclear as to Whether Arbitration is Mandatory, Judge Rules

DENVER - A Colorado federal judge has refused to compel arbitration of a $40 million insurance dispute, ruling that the movant has failed to prove at this stage of the litigation that the policy's arbitration provision is mandatory, rather than optional. Lowry Assumption LLC v. American International Specialty Lines Insurance Co., No. 10-2901 (D. Colo.).

On April 5, Senior Judge Walker D. Miller of the U.S. District Court for the District of Colorado determined that the provision is ambiguous and that the movant "must carry its burden to establish that arbitration is mandatory through a factual determination on the issue."