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that the protective intent of the federal securities laws would be frustrated by separating the claims, the district court should refuse to separate them. In the instant ease, Dean Witter concedes that the state law and federal securities claims are intertwined. Therefore, in the absence of the Kershaws’ voluntary dismissal of the federal claim, trial of all of the Kershaws’ claims should have proceeded in federal court.
Dean Witter did not waive its right to arbitration. Because the doctrine of intertwining would have precluded arbitration of the state law claims, Dean Witter’s late assertion of the right to arbitration was not inconsistent with that right. See Shinto Shipping Co. v. Fibrex & Shipping Co., Inc., 572 F.2d 1328, 1330 (9th Cir.1978).
Moreover, the Kershaws have suffered no prejudice by Dean Witter’s late assertion of the right to arbitration. See id. Because the Kershaws voluntarily have dismissed their federal securities claim, the policies underlying the doctrine of intertwining no longer are of concern. First, the policy of preserving the exclusive jurisdiction of the federal courts over the federal securities claim no longer is implicated. See Sibley v. Tandy, 543 F.2d 540, 542–43 (5th Cir.1976), cert. denied, 434 U.S. 824, 98 S.Ct. 71, 54 L.Ed.2d 82 (1977). Second, the parties will not be required to duplicate their efforts. See Dickinson v. Heinhold Securities Inc., 661 F.2d 638, 644 (7th Cir.1980). If there is arbitration, there will be no de novo trial of the pendent state claims. Rossi v. Trans World Airlines, Inc., 507 F.2d 404, 405 (9th Cir.1974) (“courts will not review the merits of arbitration awards so long as the award is based properly on the applicable … agreement”). Finally, because the federal claims have been dismissed, there will be no trial of those claims.
The order of the magistrate denying Dean Witter’s motion to compel arbitration and to stay further proceedings pending arbitration is reversed. The case is remanded to the district court with directions to order that the state law claims be submitted to arbitration and to stay further proceedings pending arbitration.
REVERSED AND REMANDED.
Emmylou HARRIS, dba Hannah Brown Music and Emmylou Harris, Plaintiffs-Appellees,
v.
EMUS RECORDS CORPORATION; Roulette Records, Inc.; Suellen Productions, Inc.; Admo Music Corporation; and Promo Records Distributing Company, Defendants-Appellants.
Emmylou HARRIS, dba Hannah Brown Music Ltd., and Emmylou Harris, Plaintiffs-Appellees,
v.
EMUS RECORDS CORPORATION, a New York corporation; Roulette Records, Inc., a New York corporation; Suellen Productions, Inc., a New York corporation; Admo Music Corporation, a New York corporation; and Promo Records Distributing Company, a New Jersey corporation, Defendants-Appellants.
Nos. 81–5753, 82–5613.
United States Court of Appeals,
Ninth Circuit.
Argued and Submitted Aug. 4, 1983.
Decided May 29, 1984.
