Fed. Sec. L. Rep. P 93,602 Harry R. Conover v. Dean Witter Reynolds, Inc., and Brenton Ogden, and Sears, Roebuck & Co.

This matter is before us after remand by the United States Supreme Court, — U.S. -, 107 S.Ct. 3203 , 96 L.Ed.2d 691 (1987). The Court vacated our opinion reported at 794 F.2d 520 (9th Cir.1986), for us to consider the case in light of Shearson/American Express, Inc. v. McMahon, — U.S. -, 107 S.Ct. 2332 , 96 L.Ed.2d 185 , reh’g denied, — U.S. -, 108 S.Ct. 31 , 97 L.Ed.2d 819 (1987), holding disputes under § 10(b) of the Securities Exchange Act of 1934 arbitrable. In light of the Supreme Court’s decision in McMahon we must hold that the arbitration agreement in this case is enforceable.

The only remaining question is whether the defendants waived their right to compel arbitration by waiting until 1985 to file their motion to compel arbitration in a suit originally filed in 1983. The district court held that there was a waiver, relying upon the principle that a party may waive its right to insist upon arbitration when it acts in a manner inconsistent with assertion of the right to arbitrate and causes the plaintiffs prejudice. See Shinto Shipping Co., Ltd. v. Fibrex & Shipping Co., Inc., 572 F.2d 1328 (9th Cir.1978).

We must reverse. The delay in filing a motion to compel was not…