Bouvet v. Illinois Union Insurance Company - Product Liability Litigation

PUBLISHED UNITED STATES COURT OF AP PEALS FOR THE FOURTH CIRCUIT No. 25 - 1139 In re: AQUEOU S FILM - FORM ING FOAMS PRODUC TS LIABIL ITY LITIGATI ON. ------------------------------ DONALD B OUVET; DO ROTHY BOW MAN; DORI S BOX; GEOR GIA BROWN; WAL TER BROWN; S COTT CHAM PEAU; CAR OL SPIKER; ROBERT DERSH AM; CATHERIN E DRYE; EARL KLINKER; DEBOR AH KOSTEK; TI MTHOY LEO NARD; CAT HY LOUCK S; PHILLI P MAROTTE; DAVID MARTIN; RYAN MATTHEWS; KAR EN MCKINNEY; ERNEST MOORER; ME GAN O'BR IEN; ZOHE QU INTERO; C LEVELAND RO SS; DARRELL S TEWART; K RESTICE STE WART; LIND SAY URE NA - TIO; WILLIAM VONZEH LE; PAULINE WIKK ERNICK; SY YOST; MARK ZAZA, Plaintiffs – Appellees, v. ILLINOIS UNIO N INSURANCE COMPANY, Defendant – Appellant, and AGC CHEMIC ALS AMER ICAS INC.; AM EREX CORP ORATION; A RKEMA INC.; ARCHROM A US INC.; BASF CO RPORATION; BUCKEYE FIRE EQUIPMENT; CHEMDESI GN PRODUCTS INC.; CHEMGUA RD INC.; CLARIANT CORPORATION; CORTEVA IN C.; DEEPWATE R CHEMICALS INC.; DUPONT D E NEMOURS INC.; DYNAX CORPORATION; E. I. DUPONT DE NEMOUR S; NATION FORD CHE MICAL CO MPANY; CHEMO URS COMPANY; C HEMOURS COM PANY FC, LLC; TYCO FIRE PROD UCTS LP; ACE AMER ICAN INSUR ANCE COMPAN Y; ACE P ROPERTY AND CASUALTY I NSURANCE COMPANY; AETNA CASUAL TY & SURET Y COMPANY; A FFILIATED FM INSURANCE COMPANY; GREAT

2 AMERICAN ASSURANCE COMPANY, f/k/a Agricultural Insurance C ompany; AIG SPECIALTY INSURANCE COMPANY, f/k/a Ch artis; AIG SPECIALTY INSURANCE GROUP, f/k/a Chartis Select Insu rance; ALLIANZ GLOBAL RISKS U S INSURANCE CO.; AL LIED WORLD NATIONAL ASSURANCE COMPANY; ALTERRA AM ERICA INSURAN CE COMPANY; AMERI CAN CENTENNIAL INSURANCE COMPANY, Berkshire Hathaway Direct Insurance Company, formerly known as American Centennial Insuran ce Company (BHDIC), incorrectly sued herein as American Cen tennial Insurance Company; AMERI CAN GUARANTEE AN D LIABILITY I NSURANCE COM PANY; AMERICA N HOME ASSURA NCE COMPAN Y; AMERICAN RE - INS URANCE COMP ANY; AMERICAN ZURI CH INSURANCE C OMPANY; ARC H INSURANCE COMPANY; ASPE N AMERICAN INS URANCE CO.; BERKLEY NATI ONAL INSURANCE COM PANY; CITY INSUR ANCE COMPA NY; COLONY INSURANCE CO MPANY; COLU MBIA CASUALT Y COMPANY; CONTINEN TAL CASUALTY C OMPANY; CONTINENT AL INSURANCE COMPANY; E MPLOYERS MUT UAL CASUA LTY COMPANY; ENDURANC E AMERICAN SPE CIALTY INS URANCE COMPAN Y; ENDURANC E RISK SOLUTION S ASSURANC E CO.; EXE CUTIVE RISK INDEMNITY, INCORPORATED, f/k/a American Excess; FEDERAL INSURANCE COMPANY; F IRST STATE INSURANCE C OMPANY; G ENERAL SECUR ITY INDEMNITY COM PANY OF ARIZONA; GIBRALTAR I NSURANCE COMPANY; GOOD RICH & WATS ON INSURERS, INC., f/k/a I NSCO; GRANITE STATE INS URANCE COM P ANY; GREAT AMER ICAN E&S INSURANC E COMPANY; GREAT AMERI CAN SPIRIT IN SURANCE COMPANY; INSU RANCE COMPA NY OF NORTH AM ERICA; INTERS TATE FIRE AND CASUA LTY COMPAN Y; IRONSHORE SPECIALTY INS URANCE COMPANY, f /k/a Tig; LEX INGTON INSURAN CE COMPANY; LIBERTY INSURANC E UNDERWRIT ERS, INCOR PORATED; L IBERTY MUTU AL INSURANC E COMPANY; LIBERTY SU RPLUS INS URANCE CORPORATI ON; LUMBERME NS MUTUAL CASU ALTY COMP ANY; NATIONAL FIRE & MARINE INS URANCE COMP ANY; NATIONA L UNION FIRE INSURAN CE COMPANY OF PITTSBURGH, PA; NEW ENGL AND INSURANC E COMPANY; N EW HAMPSHIRE INS URANCE COM PANY; NORTH AMERICA N CAPACITY INS URANCE COMP ANY; OAKWO OD INSURANCE COM PANY; OHIO CA SUALTY INSU RANCE COMPAN Y; OLD REPUBLIC RISK M ANAGEMENT, IN C.; RSUI INDEMNI TY COMPANY; STARR INDEMNI TY & LIABILIT Y COMPANY; THE HO ME INS URANCE COMPANY; TH E TRAVELERS INDEMNITY COMP ANY; WESTC HESTER SURPLUS LI NES INSU RANCE COMPA NY; XL INS URANCE AME RICA, INCORPORATED; CHEMICALS INC.; EIDP, INC., f/k /a E. I. DuPont De Nemours & Company, Defendants.

3 No. 25 - 1143 In re: AQUEOUS FILM - FORMIN G FOAMS PRODUC TS LIABILIT Y LITIGATI ON. ------------------------------ CITY OF WAUSAU, Plaintiff – Appellee, v. ILLINOIS UNIO N INSURANCE COMPANY, Defendant – Appellant, and AGC CHEMIC ALS AMER ICAS INC.; AM EREX CORP ORATION; A RKEMA INC.; ARCH ROMA US INC.; BASF COR PORATION, In dividually a nd as successor in interest to Ciba In c.; BUCKEYE FIRE EQUIPMENT; CHEMDESIGN PRODUCTS INC.; CHEMGUARD I NC.; CLARIAN T CORPORAT ION, Individually and as successor in interest to Sandoz Chemical Corporation; DEEPWATER CHE MICALS INC.; DY NAX CORPOR ATION; NATION FO RD CHEMICAL C OMPANY; TY CO FIRE PR ODUCTS LP, Individu ally and a s successor in interest to The Ansul Company; ACE AMERICAN INSURANCE COMPANY; AC E PROPERTY AND CASUA LTY INSURA NCE COMPANY; AETNA CASU ALTY & SURE TY COMPANY; AFFILIAT ED FM INSURA NCE COMPANY; G REAT AMERI CAN ASSURAN CE COMPA NY, f/k/a Ag ricultu ral Insurance Company; AIG SPECIALTY INSURANCE CO MPANY, d/b/a Chartis Specialty Insurance Comp any; AIG SPEC IALTY INSURAN CE GROUP; ALLIANZ G LOBAL RISKS US INSURANCE C O.; ALLIED WORLD NATIONAL ASSURANCE COMPANY; ALTERRA AMER ICA INSURA NCE COMPANY; AM ERICAN CENTE NNIAL INSU RANCE COMP ANY, Berks hire Hathaway Direct Insurance Company, formerly known as American Centennial Insurance Company (BHDIC), incorrectly sued h erein as American Centennial Insurance Compa ny; AMERI CAN GUARAN TEE AND LIABI LITY INSURANC E COMPANY; A MERICAN H OME ASSURA NCE COMPANY; AMERICAN RE - I NSURANCE CO MPANY; AMERI CAN ZURICH

4 INSURANCE COM PANY; ARCH INSUR ANCE COMPANY; ASPEN AMERICAN INS URANCE CO.; BERKLEY NATI ONAL INSURA NCE COMPANY; C ITY INSURANCE COMPANY; COLONY INSURA NCE COMPANY; COLUMBI A CASUALT Y COMPANY; CONTINE NTAL CASUALTY C OMPANY; CO NTINENTAL INSURANCE C OMPANY; EMPLOYERS MUTUAL C ASUALTY COMPANY; E NDURANCE AMERICAN SPE CIALTY INS URANCE COMPAN Y; ENDURANC E RISK SOLUTION S ASSURANC E CO.; EXE CUTIVE RISK INDEMN ITY, INCORPORATED, f/k/a American Excess Insurance Company; FEDERAL INSURANC E COMPANY; FIR ST STATE INSU RANCE COMPAN Y; GEN ERAL SECURITY IND EMNITY COMPANY OF ARIZON A; GIBRALTAR INSURANCE COM PANY; GOOD RICH & WATSON IN SURERS, INC., f /k/a Insco Insu rance Group; GRANITE STATE IN SURANCE CO MPANY; GREAT AMERICAN E&S I NSURANCE COMP ANY; GREAT AM ERICAN SPIRIT INSURANCE COMP ANY; HARBOR I NSURANCE, The Continental Insurance Company, as successor to certain rights and liabilities under po licies issued by Harbor Insurance Company, incorrectly sued herein as Harbor Insurance Company; INSURANCE COMP ANY OF NORTH AME RICA; INTERST ATE FIRE AND CASU ALTY C OMPANY; IRO NSHORE SPECI ALTY INSURA NCE COMPANY, f/k/a TIG Specialty Insuran ce Company; LEXINGTON INSURANCE COM PANY; LIBERT Y INSURANCE UND ERWRITERS, INCORPORAT ED; LIBE RTY MUTUAL INSURANCE COMPANY; LI BERTY SURPLUS IN SURANCE CORP ORATION; LUM BERMENS MUTU A L CASUALTY CO MPANY; NATION AL FIRE & MAR INE INSURANCE COMPANY; NATI ONAL UNION FIRE INSU RANCE COMPA NY OF PITTSBURG H, PA; N EW ENGLAND INSURANCE COMPANY; NEW HAMPSHIRE I NSURANCE C OMPANY; NO RTH AMERICA N CAPACITY INSURANCE COM PANY; OAKWO OD INSURANCE CO MPANY; OHI O CASUALTY I NSURANCE COM PANY; OLD REPUBLIC RIS K MANAGEMENT, I NC.; RSUI INDEM NITY COMPANY; S TARR INDEMNI TY & LIABILITY COM PANY; THE HOM E INSURANCE COMPANY; THE TRAVELERS INDEMNITY COMPANY; WESTCHEST ER SURPLUS LINES INSURANCE COM PANY; XL INSU RANCE AMER ICA, I NCORPORATE D; JOHN DOE S 1 - 20; THE TRAVE LERS INDEMN ITY COMPANY; TRAVELERS CASUALTY AND SURETY COMPANY, f/k/a The Aetna Casualty an d Surety Company, Defendants. Appeal s from the United States District Court fo r the District of South Carolina, at Charleston. Richard M ark Gergel, District Judg e. (2:18 - mn - 2873 -RMG; 2:24 - cv - 0343 9 - RMG;)

5 Argued: December 11, 2025 D ecided: March 4, 2026 Before GREGORY, QUATTLEBAU M, and BERNER, Circuit Judg es. Vacated and remanded by published opinion. Judge Quattlebau m wrote the opinion, in which Jud ge Gregor y and Judge Berner joined. ARGUED: Anton Metlitsky, O ’MELVENY & M YERS LLP, New York, New York, for Appellant. Andrew William Croner, NAPOLI SHKOLNIK PLLC, New York, New York, for Appellees. ON BRIEF: Robert F. Walsh, Lyndon K. Groff, WHITE & WILLIAMS, LLP, Philadelphia, Pennsylvania; Kevin K. Bell, R OBINSON GRAY STEPP & LAFFITTE, LLC, Columbia, South Carolina; Jonathan D. Hacker, Joshua Revesz, O’MELVENY & MYERS LLP, Washington, District of Co lumbia; Jason M. Zarrow, O’MELVENY & MYERS LLP, Los Angeles, California, for A ppellant.

6 QUATTLEBAUM, Circuit Judge: This appeal involves the tension between the discretion afforded a district cou rt to manage multi - district litigation and the commands of the Federal Arbitration Act. While a district court rightly has broad discretion in administering its MDL docket, it cannot do so in a way that prevents a p arty from asserting its rights u nder the FAA. Under the FAA, if a lawsuit involves an arbitrable issue, a party has a right to a stay of the lawsuit pending arbitration. Illinois Union Insurance Co mpany sought to assert that right in this case. But t he district court prevented it from doi ng so by denying it leave of co urt to file a stay motion. So, we vacate the district court’s denial of leave and remand for the district court to cons ider the merits of Illinois Union’s stay motion. I. Illinois Union is a defendant in two cases in multi - district litigation regarding alleged injuries caused by aqu eous film - forming foam products designed and manufactured by its insured. S ee Bouvet v. 3M Co., No. 2:24 - cv - 3439 - RMG (D.S.C. docketed Jan. 19, 2024); City of Wau sau v. AGC Chem s. Ams., Inc., No. 2:24 - cv - 4284 - RMG (D.S.C. docketed Mar. 19, 2024). * The plaintiffs filed these cases in Wisco nsin state court. The y alleged that Illinois Union issued excess liability policies to BASF Corpo ration and that BASF in turn “design ed, manufactured, marketed, distributed, an d /or sol d” compone nts of * Aqueous film - forming foams are “use [d] to fight liquid - based fires (those started by oil, gasoline, or oth er flammable liquids).” Aqueous film - formin g foam (AFFF), S T AT E OF W ASH. D EP ’ T OF E COLOGY, https://ecolog y.wa.gov/waste - toxics/reducing - toxic - chemicals/addressing - priority - toxic - chemicals/pfas/af f f https://perma.cc/WS6V - X7YD .

7 aqueous fi lm - forming foam products. J.A. 834, 987. T he plaintiffs alleged that Illinois Union was directly liable for BASF’s tortious conduct und er Wisconsin Statute s Section 632.24. After the defendants removed the cases to federal court, they were consolidated in the District of South Carolina under the MDL statute, 28 U.S.C. § 1407. See In re Aqueous Film - Forming Foams Prod s. Liab. Litig., 357 F. S upp. 3d 1391 (J.P.M.L. 20 18). The district court administering the MD L entered multiple case managemen t orders governing pretrial proceedings. One CMO requires that “[a]ny motion that is not signed by [lead counsel] must (i) contain an affirmation by movant’s counsel that, prior to filing [the] motion, he/she conferred with [lead counsel] about the filing of the motion, and (ii) state whether [lead coun sel] consents to the filin g of the motion.” J.A. 724. Another says that any motion not signed by lea d counsel mus t be pre ceded by “ a motion for leave of the [c]ourt to file the motion, setting forth the reasons such a motion is necessary at th at time and obtaining from the [c]ourt permission to file the motion.” Id. at 726. So, if Illinois Union want ed to file a motion over defendants’ lead counsel’s objection, Illinois Union first had to file a motion fo r leave that stated lead counsel ’s opposition. Illinois Union moved for leave to file a motion to stay Bou vet and City of Wa u sau against it pending arbitration. It argued that its policies with BASF con tained “valid arbitration agreements” and that the plaintiffs were “improperly prosecuting claims. . . under the Illinois Union policies. . . without initiating arbitration.” Id. at 1135. And Illinois Union said it hadn’t sought lead co unsel’s position on its motion in part because lead counsel “serve[d] as leadership for manufacturer defendan ts, includ ing

8 BASF, which is directly adv erse to Illinois Union with respect to co verage under the Illinois Union policies.” Id. at 1136. The plaintiffs opposed the motion on t hree grounds: (1) Illinois Union violated th e CMOs by failing to con sult with lead counsel; (2) considering the stay motion would “d isrupt the orderly proceeding of the MDL” since “individual motions affecting o nly a single defendant are no t appropriate for immediate motion practice,” Id. at 1257, 1260; and (3) the plaintiffs might not be bo und by the arbitration cla uses in Illinois Un ion’s contracts with BASF. In its reply, Illinois Un ion said that after filing its motion for leave, it re ached out to lead counsel, who “declined to provide the requested consent.” Id. at 1267. The district cou rt denied Illinois Union’s motion for leave. It first said that Illino is Union had violated a CMO by failin g to consult with lead coun sel before filing the motion and deemed this “a basis to deny [Illinois Union’s] motion fo r leave to file” a stay motion. Id. at 1275. But it seem ed to acknowledge th at Illinois Union had cured that issue by “attach[ing ] correspond ence ” with lead counsel to its reply in which “Illinois Union requested the consent of [lead counsel] to file its proposed motion to stay” and lead counsel “did not consent to the filing of Illinois Union’s motion.” Id. T he district court then identified another reason fo r deny ing leave: There are several thousand member cases in th is MDL. In each of those cases, the parties are eng aging in litigation through the auspices o f Court - appointed lead counsel and sub ject to the protocols agreed to by lead counsel and ordere d by the Court. Th ose prot ocols i nclude, a mong ot her things, [bringing] a motion under th e authority of lead counsel. Adherin g to the protocols is necessary to en sure that these central ized proceedings are efficient and consistent — qualities that benefit all parties in the MDL and that the transferee Court is required to promote. 28 U.S.C. § 1407. Allowing any Defendant in this MDL to co nduct motion practice outside the ausp ices of

9 Lead Counsel would derail the cen tralized proceeding contemplated by § 1407 and impede each party’s opportun ity to participate in an organized and efficient resolution. Id. Because lead counsel did not consent, the district court denied Illinois Union’s motion. Illinois Union timely appealed the den ial. I I. Before reaching the merits of the appeal, we add ress two preliminary issues. A. First, we must assess our appellate jurisdiction. T he denial of a motion for leave to file isn ’t a final decision. See United States v. Myers, 593 F.3d 338, 345 (4t h Cir. 201 0) (“Generally, a final decision ‘ends the litigation on the merits and leaves nothing for the court to do but execute the judgm ent.’” (quoting Catlin v. United States, 324 U.S. 229, 2 33 (1945)). So, we don’t h ave jurisdiction under 28 U.S.C. § 1291. Nor is the denial of leave among the limited set of interlocu tory orders over which 28 U.S.C. § 1292 gives us jurisdiction. But § 1291 an d § 1292 aren’t our only sour ces of appellate jurisdiction. Under 9 U.S.C. § 16(a)(1)(A), we also have appellate jurisdictio n over “an order . . . refusing a stay of any action” under 9 U.S.C. § 3— that is, an order refusing a stay pending arbitration. Appellate courts usually invoke § 16(a)(1)(A) to review the d enial of a § 3 stay motion. See Levin v. Alms and Assocs., Inc., 634 F.3d 260, 263 (4th Cir. 20 11) (noti ng that § 16(a)(1)(A) “authorizes an appeal from a district cou rt’s denial of a petition to stay an action pending arbitration u nder § 3”). Illinois Union isn’t appealing the denial of a § 3 motion — ra ther, it’s appealing the denial of leave to file a § 3 motion. Eve n so,

10 § 16(a)(1)(A) covers any “order . . . refusing a stay” under § 3. And that is what happened here. The district court denied Illinois Union leave to file a § 3 stay mot ion because defendants’ lead counsel in the MDL had not consented. This prevented Illinois Union from movi ng for, a nd thus from obtain ing, a stay. S o, the district court refuse d Illinois Union a stay, even if it didn’t explicitly say s o. See Pre - Paid Legal Servs., Inc. v. Cahill, 786 F.3d 128 7, 1292 – 93 (10th Cir. 2015) (observing that appellate jurisdiction under § 16(a)(1)(A) “is not limited to a particular form of request”). An example outside the law illustrates our point. Imagine a parent who says to his child, “I made pot roast, so don’t even think about ask ing me for Burger King tonight!” That parent has refused h is child Burger King just as mu ch as a parent who hears out his child’s request for Burger King and says no. To be clear, not all denials of leave to file a § 3 motion are immed iately reviewable. For example, if the district co urt h ad d enied leave because Illinois Union made a curable procedural error, like failing to request a pre - motion conference, the district court’s denial of leave wouldn’t have amounted to a refusal o f a stay and § 16(a)(1)(A) wouldn’t apply. But when the district cou rt denied Illinois Union leave to file a stay motion because lead counsel wouldn’t consent, there was nothing left for Illinois Union to do. So, in th is context, the district court’s denial of lea ve is a refusal of a stay and is thus reviewable under § 16(a)(1)(A). B. Second, our standard of review. W e review a district court’s d ocket - management decisions fo r abuse of discretion. Turner v. United States, 736 F. 3d 274, 283 (4th Cir.

11 2013). Th at includes the denial of leave to file a motion. See Frieders’ E st. v. C.I.R., 68 7 F.2d 224, 228 (7th Cir. 1982) (“We must decide wh ether the Tax Court abused its discretion in denying the estate leave to file its motion.”). D espite that, Illinois Union says th at, because the district court effectively denied a stay, we should apply de novo review. S ee Rowland v. Sand y Morris Fin. & Est. Plan. S ervs., 993 F.3d 253, 257 (4t h Cir. 2021) (reviewing the denial of a stay pending arbitration de novo). But it does not matter whether we review the district court’s order for abuse of discret ion or de novo be cause Illi nois Union ’s argument on appeal is that the district court committed a legal error by preventing it from filing a stay mo tion. And “a n error of law by a district court is by definition an abuse of discretion.” Hunter v. Eart hgrains C o. Bakery, 281 F.3d 144, 150 (4t h Cir. 2002). S o, under either standard o f review, we have the same job — determining whether, as a matter of law, the district court could deny a leave motion for failure to obtain lead counsel’s consent. C. With those issues behind us, we t urn to the merits of Illinois U nion’s appeal. The FAA “manifest[s] a ‘liberal federal policy favoring arbitration agreements.’” Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20, 25 (1 991) (qu oting Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 4 60 U.S. 1, 24 (1983)). It provides that “on application of one of the p arties” to stay a lawsuit p ending arbitration, the court in which such suit is pen ding, upon being satisfied that the issue involved in such suit or pro ceeding is referable to arbitra tion under such an agreement, shall . . . stay the trial of the action until such arbitration has been had in accordance with the terms of the agreement, p roviding the applicant for the stay is not in default in p roceeding with such arbitration.

12 9 U.S.C. § 3. In other words, “[w]h en a federal court finds that a dispute is subject to arbitration, and a party has requ ested a stay of the court pro ceeding pending arbitration,” the district court mu st grant the stay. Smith v. Sp izzir ri, 601 U.S. 47 2, 47 5–7 6 (2024). Had the district court allowed Illinois Union to file its stay mo tion and found that th e plaintiffs’ claims against Illinois Union were arbitrable, the district court would have had no choice but to grant the motion. The plaintiffs don’t disp ute this. Instead, they arg ue that the district court denied Illinois Union’s leave motion because it failed to confer with lead counsel, as the CMOs required, and that a district court can p ermissibly deny leave on that basis. If that were all the district court did, the plaintiffs might have had a point; “d istrict courts have the inherent authority to manage their dockets and courtrooms with a view toward the efficient and expedient resolution of cases.” Dietz v. Bouldin, 579 U.S. 40, 47 (2016). A conferral requirement falls within that authority. And requ iring Illinois Union’s attorneys to contact lead counsel before filing a motion doesn’t contradict 9 U.S.C. § 3 any more than the garden - variety procedural requirements district courts regularly impose, lik e page limits or electronic filing. But the last two parag raphs of the district court’s order recog nized that Illinois Union eventually conferred with lead counsel; the district court nonetheless denied leave beca use lead counsel didn’t provide it s “authority.” J.A. 1275. In that part of the order, t he district court made clear it wasn’t deny ing Illinois Union’s motion based on the CMO’ s requirement that Illinois Union confer with lead co unsel; instead, it w as requiring that

13 Illinois Union obtain lead counsel’s con sent, which lead counsel had already den ied. The effect of this order was that Illino is Union couldn’t file its stay motion. “ Absent extraordinary circumstances, such as a demonstrated history of friv olous and vexatious litigation. . . or a failure to comply with sanctions impo sed for such conduct. . . a court has no power to p revent a party from filing pleadings, mo tions or appeals authorized by the Federal Ru les of Civil Procedure.” Kowalchuck v. Metro. Tr ansp. Auth., 94 F.4th 21 0, 215 (2d Cir. 202 4) (alterations in original) (quotin g Richardson Greenshields Sec., Inc. v. Lau, 825 F.2d 6 47, 652 (2d Cir. 1987)). La u demonstrates this principle. There, the Second Circuit acknowledged that a district cou rt could “require a conference prior to the filing of motions as a means of managing litigation assigned to [it].” Lau, 825 F.2d at 652. But it held that the district court cou ld not “refus[e] to permit a motion to be filed without a prior conference,” then “fail[] to hold such a conference until nearly five months after one was first requested” and then deny the motion “for having been filed too late.” Id. The same principle applies to a motion autho rized by Congress in the FAA. And h ere, as in Lau, the district cou rt did more than enforce a procedural rule as a pre re quisite to filing a motio n; it barred a party from mak ing a motion. That w as a step too far. See Katz v. Cellco P’ship, 794 F.3d 341, 34 6 (2d Cir. 2015) (noting that a district court’s “inherent authority to manage [its] docket[]. . . cannot trump a statutory mandate, like Section 3 of the FAA, that clearly removes such discretion” (citation s omitted)). Perhaps the district cou rt did not intend for its ord er to go that far. Bu t as written, condit ioning Illinois Union’s ability to a file a § 3 motion on the consen t of lead counsel, that order neutered the mandatory provisions of the FAA.

14 We appreciate the “unique challenges” that come with “ administrating a multidistrict case.” Hamer v. LivaNov a Deutschland GmbH, 994 F.3d 173, 178 (3d Ci r. 2021). The district court’s inherent auth ority to manage its docket, especially under these circumstances, is strong. In re S howa Denko K.K. L- Tryptoph an Prods. Liab. Litig. - II, 953 F.2d 162, 165 (4th Cir. 1992) (“We recog nize that a district court needs to have b road discretion in coordinating and administering mu lti - district litigation.”). For that reason, it may well be that certain motions should be heard at a different time in an MDL than in a traditional case. But “ the fact that a proceed ing occurred in a [n] MDL setting does no t alter the substantive rights of the litigan ts.” Hamer, 994 F. 3d at 177 (internal quotation marks and citation omitted). And a court’s obligation to grant a meritorious stay motion under 9 U.S.C. § 3 is absolute. A district court cannot avo id that obligation by preventing the filing of that motion in the first place. III. We leave the merits of Illinois U nion’s proposed stay motion to the district court. On remand, the district court shou ld allow Illinois Union to file that motion. If the district court is “satisfied that the issue involved . . . is referable to arbitration” under Illinois Union’s arbitration agreement with BASF, it must grant the moti on. 9 U.S.C. § 3. We vacate the district court’s order denying Illinois Union leave of court to file its stay motion, and we remand for further proceedings consistent with this opinion. VACATED A ND REMA NDED