Justia Arbitration & Mediation Opinion Summaries

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Appellants (the brothers) appealed following a judgment affirming an arbitration award that resolves an employment dispute between the brothers, their former employer, defendant and respondent U-Haul Co. of California (U-Haul), and their former manager at U-Haul and Respondent. On appeal, the brothers challenge the court’s order compelling their dispute to arbitration, arguing that the arbitration agreement they signed with U-Haul is unconscionable and thus unenforceable.   The Second Appellate District affirmed the order compelling arbitration. The brothers also challenged the court’s order, issued before the court ordered the matter to arbitration, denying them leave to amend their complaint. The proposed amendment includes a Labor Code cause of action against Sandusky for unpaid wages regarding work the brothers allegedly performed at Respondent’s residence solely for his personal benefit. The court saw no basis for which the trial court could deny the brothers leave to assert such a claim. The brothers’ proposed amendment also includes a claim for relief under California’s Private Attorney General Act (the PAGA) based on the Labor Code violations by U-Haul and/or Respondent reflected in the proposed amended complaint. But the brothers cannot establish PAGA standing to bring a claim based on Labor Code violations by U-Haul already alleged in the operative complaint, because the arbitrator found no such violations occurred, and that finding has issue preclusive effect. The arbitrator’s finding does not affect the brothers’ ability to establish PAGA standing based on the proposed alleged Labor Code violation by Respondent involving unpaid wages; however, the court saw no other fatal deficiencies in the proposed PAGA claim against Respondent. View "Rocha v. U-Haul Co. of Cal." on Justia Law

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Fleming filed a class action complaint, alleging Oliphant violated the California Rosenthal Fair Debt Collection Practices Act. Oliphant filed a petition to dismiss Fleming’s class action claims and compel binding arbitration of his individual claims under the Federal Arbitration Act (9 U.S.C. 2). According to Oliphant’s records custodian, Fleming electronically applied for a credit card in December 2013. The electronic application included no reference to an arbitration agreement. Fleming received the card, used his card for purchases, made payments on his account, and received account statements, which did not include any reference to arbitration. There is no evidence of any signed agreement. Oliphant provided no evidence that it even sent such an agreement to Fleming. Oliphant proffered three Cardmember Agreements—or exemplars—that were in effect when Fleming opened his account, when he made his last payment to the account in March 2018, and when the account was charged off in May 2018, which included arbitration agreements. Fleming denied receiving any of the exemplars.The court of appeal affirmed the denial of the petition to compel arbitration. Oliphant did not meet its burden in proving the existence of a valid arbitration agreement with Fleming. Nothing in the record suggests that Fleming might have consented to an arbitration provision. View "Fleming v. Oliphant Financial, LLC" on Justia Law

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A collective bargaining agreement (CBA), covered employees at United’s Indiana distribution center, prohibiting strikes and lock-outs during the life of the agreement. Negotiations over a successor agreement were ongoing when the existing agreement expired in September 2019. The agreement provided: So long as negations are ongoing, all terms and provisions of the existing CBA will continue to apply. However, “[i]n the event of a strike, the provisions of this section do not apply.” Bargaining over a new agreement came to a standstill on September 20. On December 12, Local 414 went on strike with a picket line at the Indiana facility. On December 17, Local 414 began additional picketing at United’s Minnesota and Wisconsin distribution centers. Workers there walked off the job. On December 18, Local 414 ended the strike and ceased picketing at the other sites. In July 2020, Local 414 engaged in another strike in Indiana.United filed suit under the Labor Management Relations Act, 29 U.S.C. 185, alleging that the strikes violated the CBA’s no-strike provisions. Local 414 moved to compel arbitration of the claim. The Seventh Circuit affirmed that the claims were not subject to arbitration. The arbitration procedure is focused exclusively on employee-initiated grievances and does not apply to employer-initiated grievances. The arbitration clause is not reasonably susceptible to an interpretation that includes an employer-initiated dispute regarding the CBA’s terms. View "United Natural Foods, Inc. v. Teamsters Local 414" on Justia Law

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Casandra Murrey, a single, 46-year-old female, worked for General Electric Company (GE) as a product sales specialist for ultrasound equipment. The complaint alleged GE hired Murrey in early 2018 and she was a “top performer.” In 2019, GE hired Joseph Gorczyca, III. In January 2020, he became Murrey’s direct supervisor, and he engaged in continuous sexual harassment in the workplace with Murrey and others. She alleged GE “never properly completed an immediate [n]or appropriate investigation or took any . . . corrective action. Instead, [GE] later informed [her] that Gorczyca was ‘no longer with the company.’” Thereafter, GE “commenced an illegal pattern of retaliatory behavior against Murrey because [she] engage[ed] in protective activity” that included “denying appropriate support for [her] sales position” and refusing to promote her. Eight months after Murrey filed the complaint, GE moved to compel arbitration. GE sent all new hires a “welcome e-mail” to the new hire’s personal e-mail address that contained a link to GE’s electronic onboarding system/portal. Each document was assigned a separate task and the new hire signed employment-related agreements using his or her electronic signature. Based on this process and GE’s other security measures, GE’s lead HR specialist Michelle Thayer concluded Murrey’s electronic signature on an Acknowledgment was made by Murrey that Murrey assented to an included arbitration in the onboarding materials. The trial court granted the motion to compel arbitration, concluding:(1) GE met its burden of showing the arbitration agreement covered Murrey’s claims; (2) all of Murrey’s causes of action arose out of or were connected with her employment; and (3) Murrey met her burden showing procedural unconscionability because it was a contract of adhesion; but (5) Murrey failed to show a sufficient degree of substantive unconscionability to render the agreement unenforceable. The Court of Appeal reversed, finding the arbitration agreement in this case contained a high degree of procedural unconscionability. "When we consider the procedural and substantively unconscionable provisions together, they indicate a concerted effort to impose on an employee a forum with distinct advantages for the employer." The Court issued a writ of mandate on the trial court to vacate the order compelling arbitration, and to enter a new order denying the motion. View "Murrey v. Superior Court" on Justia Law

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Plaintiff signed an arbitration contract with an employer called Intelex Enterprises, LLC. While working for Intelex, Plaintiff also worked for other firms (Other Firms). These Other Firms were legally separate from Intelex but functionally related to it. The Other Firms did not contract for arbitration with Plaintiff. After termination, Plaintiff sued the Other Firms but not Intelex: Intelex has never been a party to the case. The Other Firms moved to compel arbitration based on Plaintiff’s agreement with Intelex. The trial court denied the Other Firms’ motion to enforce a contract they had not signed.   The Second Appellate District affirmed. The court held that the Other Firms cannot equitably estop Defendant because they do not show she is trying to profit from some unfair action. They have no proof of agency. And they are not third-party beneficiaries of Intelex’s contract. The court explained that the Other Firms point to six places in the record they say show agency, but these materials do not measure up. The citation to Plaintiff’s complaint spotlights text that omits Intelex and cannot show agency. A different citation is to their attorney’s declaration recounting irrelevant procedural history. Other citations refer to Plaintiff’s admission that she worked for both Intelex and the Other Firms. This admission does not establish agency. View "Hernandez v. Meridian Management Services, LLC" on Justia Law

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In this dispute over an arbitration clause within a contract, the Supreme Court held that the minor children who joined Plaintiffs, their parents, in bringing this action seeking damages for construction defects in their home may be compelled to arbitrate along with their parents on the basis of direct-benefits estoppel.Plaintiffs, Tony and Michelle Ha, signed a purchase agreement with Taylor Woodrow Communities-League City, Ltd. to build a home in Texas. The agreement included an arbitration provision. The Has sued both Taylor Woodrow Communities-League City, Ltd. and Taylor Morrison of Texas, Inc., for negligent construction and other claims, alleging the home developed significant mold problems due to construction defects. Plaintiffs' second amended petition named both Tony and Michelle and their three children. Taylor Morrison moved to compel arbitration, but the trial court denied the motion as it pertained to Michelle and the children. The court of appeals affirmed. The Supreme Court reversed, holding that when a family unit resides in a home and files suit for factually intertwined construction-defect claims concerning the home, a nonsignatory spouse and minor children have accepted direct benefits under the signatory spouse’s purchase agreement such that they may be compelled to arbitrate through direct-benefits estoppel. View "Taylor Morrison of Texas, Inc. v. Ha" on Justia Law

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In this dispute over an arbitration clause within a contract, the Supreme Court held that the minor children who joined Plaintiffs, their parents, in bringing this action seeking damages for construction defects in their home may be compelled to arbitrate along with their parents on the basis of direct-benefits estoppel.Plaintiffs, Jack and Erin Skufca, signed a purchase agreement with Taylor Woodrow Communities-League City, Ltd. to build a home in Texas. The agreement included an arbitration provision. Plaintiffs sued both Taylor Woodrow Communities-League City, Ltd. and Taylor Morrison of Texas, Inc., for construction defects and fraud, alleging that less than a year after they moved in, the home developed mold issues that caused their minor children to be ill. The petition listed Jack and Erin as plaintiffs individually, as well as Erin as next friend of the couple's children. Taylor Morrison moved to compel arbitration, but the trial court denied the motion as it pertained to the children. The court of appeals affirmed. The Supreme Court reversed, holding that the minor children sued based on the contract and were subject to its terms, including the arbitration clause. View "Taylor Morrison of Texas, Inc. v. Skufca" on Justia Law

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Plaintiff sued Sisyphian for (1) failure to pay minimum wage, (2) failure to pay overtime wages, (3) failure to pay wages for missed meal periods, (4) failure to pay wages for missed rest breaks, (5) waiting time penalties (6) failure to provide accurate wage statements and (7) unfair competition. In reliance on the arbitration clause in the Entertainment Agreement, the trial court granted Sisyphian’s motion to compel arbitration of Plaintiff’s claims. The arbitrator concluded that Plaintiff’s complaint contained a viable prayer for attorney fees for the claims on which she prevailed. Plaintiff filed a petition to confirm the final arbitration award. Following the entry of judgment for Plaintiff in the amount of $105,109.75, Sisyphian appealed. Sisyphian argued that the trial court erred in confirming the final arbitration award because, in reconsidering its initial attorney fees order, the arbitrator exceeded his powers   The Second Appellate District affirmed. The court explained that because Plaintiff’s petition to confirm was procedurally proper because no party sought dismissal of Plaintiff’s petition, and because Sisyphian’s filings seeking to vacate or correct the arbitration award were not timely filed, the trial court, in this case, was obligated to confirm the final arbitration award. Further, because Sisyphian forfeited its right to seek to vacate or correct the final arbitration award before the trial court, the court may not consider its arguments to do so on appeal. View "Darby v. Sisyphian, LLC" on Justia Law

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Plaintiff and appellant, a contractor, prevailed in an arbitration against its client, the Defendant and Respondent. After finding that Plaintiff was not duly licensed because its responsible managing employee (RME) did not meet the criteria required by law, the trial court granted Defendant's petition to vacate the arbitration award on the ground that the arbitrator exceeded her powers.Plaintiff made two main arguments on appeal. It first contends the trial court misapplied the burden of proof regarding whether Plaintiff was a duly licensed contractor. The Second Appellate District rejected this argument, finding that the trial court correctly determined that Plaintiff had the burden of proof on this issue.Plaintiff also argued the trial court erroneously denied it an evidentiary hearing. In the trial court, however, Plaintiff did not seek an evidentiary hearing. It instead argued that such a hearing was not authorized by law. Therefore, the Second Appellate District held that Plaintiff forfeited the issue on appeal. View "Vascos Excavation Group LLC v. Gold" on Justia Law

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Employer Howard Center appealed a trial court order that confirmed an arbitration award in favor of grievant Daniel Peyser and AFSCME Local 1674. In May 2019, employer expressed concern over grievant’s billing practices, specifically, his submission of billing paperwork in May for services provided in April. Employer told grievant that it was considering disciplining him for “dishonesty and unethical action” concerning the backdated bills. Grievant brought two billing notes from patient records to show that other employees engaged in the same billing practices. Employer did not reprimand grievant for the billing practices. In August 2019, however, employer informed grievant that he breached employer’s confidentiality policy by sharing the billing notes with his union representative at the June meeting. Employer issued a written reprimand to grievant. The reprimand stated that sharing client records without redacting confidential information violated protocols and state and federal regulations, and that grievant knew or should have known of these standards. Employer also explained that it was required to report the breach to state and federal authorities and to those individuals whose records were disclosed. Grievant filed a grievance under the terms of his collective-bargaining agreement, arguing in part that employer lacked just cause to discipline him. In an October 2020 decision, the arbitrator sustained the grievance. Employer then filed an action in the civil division seeking to modify or vacate the arbitrator’s award, arguing in relevant part that the arbitrator manifestly disregarded the law in sustaining the grievance. Employer asked the Vermont Supreme Court to adopt “manifest disregard” of the law as a basis for setting aside the arbitration award and to conclude that the arbitrator violated that standard here. The Supreme Court did not decide whether to adopt the manifest-disregard standard because, assuming arguendo it applied, employer failed to show that its requirements were satisfied. The Court therefore affirmed. View "Howard Center v. AFSCME Local 1674, et al." on Justia Law