In a new case that reminds federal judges everywhere to sing “I’ve got the power!” like C&C Music Factory, the Fifth Circuit reiterates that federal courts can stay related state court actions if necessary to “protect or effectuate” an order compelling arbitration. American Family Life Assurance Co. of Columbus v. Biles, __ F.3d __, 2013 WL 1809766 (5th Cir. April 30, 2013).
The underlying facts of the case highlight a tragically dysfunctional family. An adult homosexual man named his partner as a beneficiary of his life insurance, but when the insurer in fact distributed money to the decedent’s life partner, the decedent’s mother and siblings sued the partner, the insurer, and the insurance agent in state court, alleging that they all conspired to fraudulently obtain life insurance “with the intent to end the decedent’s life and collect the policy’s death benefits.”
