Justia Arbitration & Mediation Opinion Summaries

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At issue in this appeal is whether (despite agreeing to arbitrate any dispute with their employer) final-mile delivery drivers—drivers who make local deliveries of goods and materials that have been shipped from out-of-state to a local warehouse—are in a "class of workers engaged in foreign and interstate commerce" and, thus, exempt under the Federal Arbitration Act (FAA) from having to arbitrate their Fair Labor Standards Act (FLSA) claims. The district court concluded that they were exempt and refused to compel arbitration.The Eleventh Circuit concluded that the district court misapplied Hill v. Rent-A-Center, Inc., 398 F.3d 1286, 1290 (11th Cir. 2005), and wrongly determined that the exemption applied. The court reversed the part of the district court's order denying the employer's motion to compel arbitration under the FAA and remanded for the district court to determine whether the drivers are in a class of workers employed in the transportation industry and whether the class, in general, is actually engaged in foreign or interstate commerce. The court dismissed the part of the appeal challenging the district court's denial of the employer's motion to compel arbitration under state arbitration law based on lack of appellate jurisdiction. View "Hamrick v. Partsfleet, LLC" on Justia Law

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Colulmbia City seeks to compel IMA to arbitrate a dispute involving unreimbursed medical fees. The parties are connected by a series of intermediary agreements within a preferred provider organization (PPO) network that allows patients in covered health plans to receive medical services from participating hospitals at discounted rates, and one of these agreements contains an arbitration clause. It is undisputed that IMA is not a party or signatory to the Hospital Agreement that contains the arbitration clause.The Fifth Circuit affirmed the district court's denial of Columbia Hospital's motion to compel arbitration. Applying Texas law, the court concluded that the district court correctly applied this circuit's precedent that knowledge of the agreement requires knowledge of the contract's basic terms. In this case, the district court did not clearly err in concluding, based on the record before it, that IMA lacked the requisite knowledge of the Hospital Agreement and its basic terms to be compelled to arbitrate under direct benefits estoppel. Alternatively, the court declined, contrary to Columbia Health's assertions, to construe the series of contracts between IMA, PPOplus, HealthSmart and Columbia Hospital as a unified contract. View "IMA, Inc. v. Columbia Hospital Medical City" on Justia Law

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The Supreme Court reversed the decision of the court of appeals vacating an arbitration award and affirmed the circuit court's denial of the motion to vacate the arbitrator's award, holding that the court of appeals exceeded the statutory basis for vacating the award.After she purchased a home, Plaintiff initiated an arbitration proceeding against Defendants, the seller of the home as well as two real estate agents, seeking to recover damages or to rescind the purchase contract. The arbitrator concluded that Plaintiff could not, as a matter of law, prevail on her breach of contract and rescission claims. Plaintiff filed a petition seeking to vacate the arbitration decision pursuant to the provisions of Ky. Rev. Stat. 417.160. The circuit court denied the petition. The court of appeals reversed and remanded for a new arbitration. The Supreme Court reversed, holding that the arbitrator did not exceed his powers. View "Booth v. K&D Builders, Inc." on Justia Law

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RECON filed suit against AECOM for damages related to AECOM's alleged failure to properly manage the construction project on which RECON worked as one of AECOM's subcontractors. After AECOM moved to compel arbitration based on an arbitration clause contained in a separate contract (the Prime Agreement) between AECOM and the property owner, Shell, the trial court denied AECOM's motion.The Court of Appeal affirmed and concluded that, in the absence of a clear agreement to submit a dispute to arbitration, the court will not infer a waiver of a party's jury trial rights. The court explained that the subcontractor's incorporation of a voluminous contract containing an arbitration agreement between other parties was insufficient to subject RECON to arbitration of its claims against AECOM. Accordingly, AECOM has failed to establish the existence of an agreement to arbitrate RECON's claims. View "Remedial Construction Services, LP v. Aecom, Inc." on Justia Law

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The Ninth Circuit vacated the district court's order denying LMB's motion to compel arbitration under the Federal Arbitration Act (FAA) in an action brought by plaintiff under the Telephone Consumer Protection Act (TCPA). The panel concluded that, because the district court mistakenly issued a nonfinal order denying LMB’s motion to compel arbitration, while stating its intent to schedule a trial to resolve the factual issues, the panel has jurisdiction to consider this appeal under 9 U.S.C. 16.However, the panel held that, under 9 U.S.C. 4, once a district court concludes that there are genuine disputes of material fact as to whether the parties formed an arbitration agreement, the district court must proceed without delay to a trial on arbitrability and hold any motion to compel arbitration in abeyance until the factual issues have been resolved. In this case, LMB challenges the district court's determination that there are genuine disputes of material fact on arbitrability. Therefore, in order to further Congress's clear intent in the FAA to move the parties to an arbitrable dispute out of court and into arbitration as quickly and easily as possible, the panel vacated the district court's erroneous denial of the motion to compel and remanded for the district court to proceed summarily to the trial on the question whether plaintiff is bound by the arbitration agreement. View "Hansen v. LMB Mortgage Services, Inc." on Justia Law

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Soliman entered a California Subway sandwich shop. An employee showed her an in-store, hard-copy advertisement, on which Subway offered to send special offers if she texted a keyword. Soliman sent a text message to Subway. Subway began sending her, via text message, hyperlinks to electronic coupons. Soliman alleges that she later requested by text that Subway stop sending her messages, but her request was ignored. She filed suit under the Telephone Consumer Protection Act. Subway moved to compel arbitration, arguing that a contract was formed because the in-store advertisement, from which Soliman got the keyword and shortcode, included a reference to terms and conditions, including an arbitration requirement, located on Subway’s website and provided the URL.The Second Circuit affirmed the denial of the motion to compel arbitration. Under California law, Soliman was not bound by the arbitration provision because Subway did not provide reasonably conspicuous notice that she was agreeing to the terms on the website. Because of barriers relating to the design and content of the print advertisement, and the accessibility and language of the website itself, the terms and conditions were not reasonably conspicuous under the totality of the circumstances; a reasonable consumer would not realize she was being bound to such terms by sending a text message to Subway in order to receive promotional offers. View "Soliman v. Subway Franchisee Advert. Fund Trust, Ltd." on Justia Law

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Plaintiff filed suit against Defendants Sachse, Ameriprise, and individual Ameriprise officers, alleging violations of federal securities law. Plaintiff also sought to represent other Sachse and Ameriprise clients in a class action. Defendants filed motions to strike plaintiff's class action allegations and to compel arbitration, which the district court denied.The Eighth Circuit reversed and remanded for entry of an order striking plaintiff's class action allegations and compelling arbitration. The court concluded that it has appellate jurisdiction to review the district court's denial of defendants' motions to strike class action allegations because this denial was contained in an order reviewable under 9 U.S.C. 16(a)(1)(B). The court also concluded that defendants have not waived their right to arbitrate by moving to strike plaintiff's class action allegations at the same time they moved to compel arbitration where the action was not inconsistent with their right to arbitrate and did not substantially invoke the litigation machinery. On the merits, the court concluded that a valid arbitration clause exists and that it encompasses the dispute between the parties. In this case, the court agreed with defendants that the arbitration clause was valid because it was supported by mutual assent, was supported by consideration, and was not unconscionable. View "Donelson v. Ameriprise Financial Services, Inc." on Justia Law

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The Supreme Court affirmed the judgment of the circuit court refusing to compel arbitration in this case alleging violations of the West Virginia Human Rights Act, W. Va. Code 5-11-1 to -20, holding that the West Virginia Department of Health and Human Resources (DHHR) could not enforce the arbitration agreement.Plaintiff, a nurse who formerly worked for Sunbelt Staffing, LLC, signed an employment agreement containing an arbitration provision. Plaintiff was assigned to work at a hospital under DHHR's direction but later was informed she was not eligible to return to work for DHHR. Plaintiff filed an amended complaint against DHHR and others, alleging violations of the Act. DHHR moved to dismiss the amended complaint and to compel arbitration. The circuit court denied the motion. The Supreme Court affirmed, holding (1) DHHR had no right to invoke arbitration contained in the employment agreement; and (2) the theory of estoppel did not require arbitration. View "W. Va. Department of Health & Human Resources v. Denise" on Justia Law

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The Fifth Circuit reversed and remanded with instructions to deny IEVM's motion to compel arbitration and to enter judgment for UEG. The court concluded that the parties failed to contract around the general rule that courts resolve litigation-conduct waivers. Therefore, the arbitrators exceeded their authority in resolving the issue here.Applying the substantial invocation analysis, the court concluded that IEVM substantially invoked the judicial process to UEG's detriment. In this case, IEVM sued UEG in state court without saying anything about arbitration; demanded a jury trial and paid the required fee; filed a motion to remand the action to state court and appealed the district court's denial of that motion; vigorously defended the existence of personal jurisdiction in Texas and appealed the district court's personal jurisdiction dismissal; and sought rehearing en banc after this court affirmed the district court's removal and jurisdictional holdings. Furthermore, UEG has made the requisite showing of prejudice where, among other things, IEVM's persistent pursuit of litigation required UEG to defend its interests, and UEG incurred significant fees and costs. View "International Energy Ventures Management, LLC v. United Energy Group, Ltd." on Justia Law

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The Labor Management Relations Act forbids employers from directly giving money to unions, 29 U.S.C. 186(a); an exception allows an employer and a union to operate a trust fund for the benefit of employees. Section 186(c)(5)(B) requires the trust agreement to provide that an arbitrator will resolve any “deadlock on the administration of such fund.” Several construction companies and one union established a trust fund to subsidize employee vacations. Six trustees oversaw the fund, which is a tax-exempt entity under ERISA 26 U.S.C. 501(c)(9). A disagreement arose over whether the trust needed to amend a tax return. Three trustees, those selected by the companies, filed suit, seeking authority to amend the tax return. The three union-appointed trustees intervened, arguing that the dispute belongs in arbitration.The court agreed and dismissed the complaint. The Sixth Circuit affirmed. While ERISA plan participants or beneficiaries may sue for a breach of statutory fiduciary duty in federal court without exhausting internal remedial procedures, this complaint did not allege a breach of fiduciary duties but rather alleges that the employer trustees’ own fiduciary duties compelled them to file the action to maintain the trust’s compliance with tax laws. These claims were “not directly adversarial to the [union trustees] or to the Fund.” View "Baker v. Iron Workers Local 25" on Justia Law