The Michigan office of Alix, an international company, administers payroll and benefits for U.S. employees and is directly involved in U.S. hiring. In 2013, Alix hired Brewington, a Texas resident, for its Dallas Corporate Services team. The employment agreement provides that it “will be construed and interpreted in accordance with the laws of the State of Michigan” and states, “any dispute arising out of or in connection with any aspect of this Agreement and/or any termination of employment . . ., shall be exclusively subject to binding arbitration under the . . . American Arbitration Association . . . decision of the arbitrator shall be final and binding as to both parties.” In 2014, Brewington was terminated. He filed a demand for arbitration, asserting claims under Title VII, 42 U.S.C. 2000e, on behalf of himself and a purported nationwide class of current, former, and potential Alix employees. The Michigan district court ruled that Brewington was precluded from pursuing arbitration claims on behalf of any purported class. The Sixth Circuit affirmed that court’s refusal to dismiss, finding that Brewington had sufficient contacts with Michigan to establish personal jurisdiction, and upheld summary judgment in favor of Alix. An agreement must expressly include the possibility of classwide arbitration to indicate that the parties agreed to it. This clause is silent on the issue and is limited to claims concerning “this Agreement,” as opposed to other agreements. It refers to “both parties.” View "AlixPartners, LLP v. Brewington" on Justia Law

Plaintiffs were hired by U-Haul as customer service representatives and, as a condition of their employment, they signed a mandatory arbitration agreement. Plaintiffs filed a representative action under the Private Attorneys General Act of 2004 (PAGA), Lab. Code, 2698 et seq., alleging that U-Haul violated several provisions of the Labor Code, including overtime and meal break requirements. The trial court denied U-Haul's motion to compel plaintiffs to individually arbitrate whether they qualified as "aggrieved employees" and thus had standing to pursue a PAGA claim. The court concluded that the trial court correctly determined that plaintiffs are not required to individually arbitrate whether they qualify as aggrieved employees where whether plaintiffs have standing to pursue a PAGA claim is not an issue that falls within the scope of the arbitration agreement; even if the agreement does require plaintiffs to arbitrate whether they have standing to bring a PAGA claim, the provision is unenforceable under California law; and the Federal Arbitration Act (FAA), 9 U.S.C. 1 et seq., does not preempt state law rules applicable to PAGA claims. Accordingly, the court affirmed the judgment. View "Perez v. U-Haul Co. of CA" on Justia Law

Plaintiffs, primarily low-income mobile home owners who rent the land owned by Westmont, filed suit against Westmont and others (collectively, appellants) alleging contract, tort and statutory causes of action. Appellants filed a motion to compel plaintiffs to arbitrate the claims but the trial court denied the motion to compel. The court concluded that the arbitration provision contained in the rental agreements was procedurally unconscionable because it failed to disclose prohibitively expensive arbitration fees and was neither provided in a Spanish-language copy nor explained to respondents who did not understand written English; the arbitration provision was substantively unconscionable as it imposed arbitral fees that were unaffordable or would have substantially deterred plaintiffs from asserting their claims; and the provision’s unreasonably shortened limitations periods for many of the asserted causes of action and its limitation on the remedies available in arbitration for statutory claims further support a finding of substantive unconscionability. Accordingly, the court affirmed the judgment. View "Penilla v. Westmont Corp." on Justia Law

The Union filed suit to compel arbitration under its collective bargaining agreement (CBA) with Shaw. The district court granted the Union’s motion to compel arbitration and ordered the parties to select an arbitrator, which they did. After holding a hearing, the arbitrator issued a written decision siding with the Union. Shaw moved the district court to vacate the award, contending, among other things, that the arbitrator had exceeded her power by improperly modifying the CBA instead of interpreting it. The district court then vacated the award and the Union appealed. In light of United Steelworkers of Am. v. Enter. Wheel & Car Corp., the court concluded that it must resolve the ambiguity in the stated reasons for the award in favor of enforcement. Therefore, the court concluded that the arbitrator interpreted instead of modified the agreement. The court reversed and remanded. View "Wiregrass Metal Trades Council v. Shaw Envtl." on Justia Law

Plaintiffs represent a putative class of New Jersey real estate purchasers and refinancers who were overcharged $70 to $350 in fees. Plaintiffs allege that settlement agents (Defendants) intentionally charged Plaintiffs more than the county clerk charged for recording deeds and mortgages and kept the difference. The class claims total over $50 million, exclusive of treble damages and interest. Defendants sought dismissal and raised affirmative defenses, but did not seek to enforce arbitration clauses present in their contracts with Plaintiffs. The case was litigated for 30 months with the focus primarily on class certification. Both sides conducted broad discovery and contested substantive motions. Plaintiffs have served 130 non-party subpoenas and spent over $50,000 on experts. In 2011, the Supreme Court held that the Federal Arbitration Act (FAA) preempted state laws that had previously prohibited a party from compelling bipolar (individual) arbitration in certain situations even when it was specifically agreed to by contract. Defendants demanded enforcement of the arbitration agreements in light of this change in the law, then moved to compel bipolar arbitration. The Third Circuit affirmed in favor of Defendants. Futility can excuse the delayed invocation of the right to compel arbitration; any attempt to compel bipolar before the Supreme Court’s decision would have been futile. View "Chassen v. Fid. Nat'l Fin. Inc." on Justia Law

Plaintiffs Mohamed and Gillette, former Uber drivers, filed suit alleging on behalf of themselves and a proposed class of other drivers that Uber violated the Fair Credit Reporting Act (FCRA), 15 U.S.C. 1681 et seq., and various state statutes. Gillette has also brought a representative claim against Uber under California’s Private Attorneys General Act of 2004 (PAGA) alleging that he was misclassified as an independent contractor rather than an employee. The district court denied Uber’s motion to compel arbitration of the claims. The court concluded that the district court improperly assumed the authority to decide whether the arbitration agreements were enforceable. The question of arbitrability as to all but Gillette’s PAGA claims was delegated to the arbitrator. Under the terms of the agreement Gillette signed, the PAGA waiver should be severed from the arbitration agreement and Gillette’s PAGA claims may proceed in court on a representative basis. All of plaintiffs’ remaining arguments, including both Mohamed’s challenge to the PAGA waiver in the agreement he signed and the challenge by both plaintiffs to the validity of the arbitration agreement itself, are subject to resolution via arbitration. Finally, the court affirmed the district court’s order denying Hirease’s joinder in the motion to compel. View "Mohamed v. Uber Technologies" on Justia Law

Samaan, a General Dynamics engineer since 1977, believed that the company was using the wrong shock-and-vibration testing methods on Stryker armored vehicles developed for use by the Army in Afghanistan and Iraq, which led, in turn, to submission of purportedly erroneous reports detailing the shock-and-vibration specifications for the vehicles. Samaan alleged that from 2004-2010 he repeatedly raised his concerns and eventually “filed a formal claim of data misrepresentation, fraud, and retaliation” with the Human Resources Department in 2010. General Dynamics allegedly gave Samaan his first poor performance evaluation in 2011, with a statement that his evaluation “would improve if he would ‘forget’ about the testing misrepresentation and fraud.” Samaan eventually took his concerns to the Army. He was suspended without pay, then filed suit, alleging retaliation, and resigned. An arbitrator, required by Samaan’s employment agreement, issued an award in favor of the Company, which the district court declined to vacate. The Sixth Circuit affirmed, rejecting challenges to the procedures employed during arbitration and stating that the Federal Arbitration Act does not allow for vacatur based on the fulfillment of moral and ethical obligations. View "Samaan v. Gen. Dynamics Land Sys., Inc." on Justia Law

Royal Alliance, a securities brokerage firm, petitioned to confirm an arbitration award recommending expungement of an allegation of misconduct from the record of one of its employees. Sandra Liebhaber, the individual who made the allegation, petitioned to vacate the same arbitration award. FINRA also petitioned to vacate the award. The trial court denied Royal Alliance’s petition to confirm the award and granted Liebhaber’s and FINRA’s petitions to vacate. The court concluded that the arbitrators denied Liebhaber a full and fair opportunity to introduce and challenge evidence material to the expungement proceedings to which she was a party; the arbitrators’ refusal to hear Liebhaber’s evidence and cross-examination deprived Liebhaber of a fair hearing and substantially prejudiced her rights within the meaning of Code of Civil Procedure section 1286.2; and thus the court affirmed the judgment. View "Royal Alliance Assoc. v. Liebhaber" on Justia Law

Before they were married, Wife and Husband entered a prenuptial agreement. Approximately ten years later, Wife brought a marital dissolution action against Husband. In accordance with an agreement to arbitrate in the prenuptial agreement, the trial court ordered the parties to proceed to arbitration on the matter of the sale of the parties’ residence. The arbitrator issued a partial award and then a final award. The trial court confirmed the partial award and confirmed in part, modified in part, and vacated in part the final arbitration award. Defendant appealed. The trial court subsequently entered judgment dissolving the marriage, allocating property, interpreting the prenuptial agreement, and deciding all pending motions. Defendant filed a second appeal. The Supreme Court affirmed, holding (1) the trial court properly applied Conn. Gen. Stat. 46b-66(c) to the agreement to arbitrate contained within the prenuptial agreement; (2) the trial court did not abuse its discretion by denying Defendant’s motion for leave to file an amended answer and cross complaint; and (3) the arbitrator did not exceed her authority by issuing orders in contravention of the express terms of the prenuptial agreement. View "LaFrance v. Lodmell" on Justia Law

Plaintiff signed an arbitration agreement providing that any disputes between her and her payday lender would be resolved by arbitration before the National Arbitration Forum (NAF). When plaintiff tried to take her case to arbitration, however, NAF refused to accept it pursuant to a consent decree that prohibited NAF from accepting consumer arbitrations. The court agreed with the district court that the arbitration agreement contemplated arbitration only before NAF and thus affirmed the district court's decision declining to compel arbitration before a different arbitrator. View "Moss v. First Premier Bank" on Justia Law