Justia Arbitration & Mediation Opinion Summaries

The Fourth Circuit affirmed the district court's order denying BMO Harris's renewed motion to compel arbitration. Plaintiff filed suit against BMO Harris, alleging that BMO Harris violated the Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C.1961 et seq., when BMO Harris used its role within a network of financial institutions to conduct and participate in the collection of unlawful payday loans. BMO Harris sought to enforce an arbitration agreement for the loan, which was entered into by plaintiff and the lender, Great Plains. The Fourth Circuit affirmed the denial of BMO Harris's motion to enforce the arbitration agreement in light of Hayes v. Delbert. In Hayes, the Fourth Circuit applied the prospective waiver doctrine and held that the entire arbitration provision at issue was unenforceable. The choice of law provisions in this case were indistinguishable in substance from the related provisions in the agreement in Hayes. These choice of law provisions were not severable from the broader arbitration agreement and rendered the entire arbitration agreement unenforceable. View "Dillon v. BMO Harris Bank, N.A." on Justia Law

The Eighth Circuit affirmed the district court's decision to uphold an arbitration award reinstating an employee to his job as a security officer at Entergy's nuclear power plant. The employee has chronic folliculitis, and Entergy thought this would keep him from shaving often enough to properly wear a full-face gas mask in the event of a chemical attack. The arbitrator ordered reinstatement because Entergy never fit-tested the employee with facial hair before concluding that it disqualified him from the position. The Eighth Circuit held that the arbitrator's order requiring that the employee be reinstated with backpay and subject to an acceptable respirator or a reasonable accommodation was not against public policy nor exceeded the arbitrator's authority. In this case, the arbitrator did not stray outside his authority to interpret and apply the contract, and the award was within the range of possibilities Entergy bargained for. View "Entergy Operations v. United Government Security Officers" on Justia Law

Respondent, who owned a ranch, sued Petitioner, which produced natural gas on the ranch, for underpayment of royalties and underproduction of its lease. The parties resolved their dispute with two agreements that contained an arbitration provision. Respondent later sued Petitioner for environmental contamination and improper disposal of hazardous materials on the ranch. Before arbitration commenced, Respondent asked the Railroad Commission (RRC) to investigate contamination of the ranch by Petitioner. Meanwhile, an arbitration panel awarded Respondent $15 million for actual damages and $500,000 for exemplary damages. At issue on appeal was whether the RRC had exclusive or primary jurisdiction over Respondent’s claims, precluding the arbitration, and whether the arbitration award should be vacated for the evident partiality of a neutral arbitrator or because the arbitrators exceeded their powers. The Supreme Court answered in the negative, holding (1) because Respondent’s claims were inherently judicial, the doctrine of primary jurisdiction did not apply, and vacatur was not warranted for failure to abate the arbitration hearing; and (2) the arbitrators did not exceed their authority. View "Forest Oil Corp. v. El Rucio Land & Cattle Co." on Justia Law

RT Import Inc. filed a complaint against Jesus and Mila Torres seeking damages for merchandise allegedly misdelivered by WFS to the Torreses, which was then converted by the Torreses. RT Import and the Torreses agreed to resolve their dispute through binding arbitration. The arbitrator found that the Torreses committed the intentional tort of conversion and awarded RT Import damages. The arbitrator also found that the Torreses were responsible for arbitration fees and costs. The circuit court granted RT Import’s motion to confirm the final award and awarded RT Import $106,711.62 in damages and $8,355.49 for arbitration attorney’s fees and costs. The Intermediate Court of Appeals (ICA) affirmed the circuit court’s confirmation of the final arbitration award and judgment. The Supreme Court vacated the circuit court’s judgment as to $4,738.74 of the $8,355.49 for RT’s arbitration attorney’s fees and costs and otherwise affirmed, holding that the circuit court erred by including in the judgment confirming the arbitration award $4,738.74 directly billed by RT Import to the Torreses, which was not a part of the final award. Remanded. View "RT Import, Inc. v. Torres" on Justia Law

General Mills terminated employees and offered them benefits in exchange for releasing all Age Discrimination in Employment Act (ADEA), 29 U.S.C. 626(f)(1), claims and arbitrating release-related disputes. Plaintiffs, 33 employees who signed releases, subsequently filed suit seeking a declaratory judgment that the releases were not "knowing and voluntary." Plaintiffs also raised collective and individual ADEA claims. The district court denied General Mills' motion to compel arbitration. The court rejected plaintiffs' claim that the agreement to arbitrate applies only to claims "relating to" the release of claims, and their substantive ADEA claims are not related to the release of claims. Rather, the court found that the agreements' "relating to" sentence showed the parties' intent to arbitrate both disputes about the release and substantive ADEA claims. Therefore, the ADEA claims were covered by the agreements. The court explained that, absent a contrary congressional command, General Mills can compel employees who signed the agreements to arbitrate their ADEA claims. In this case, the court concluded that no "contrary congressional command" overrides the Federal Arbitration Act's (FAA), 9 U.S.C. 1 et seq., mandate to enforce the parties' agreement to arbitrate substantive ADEA claims. Accordingly, the court reversed and remanded for further proceedings. View "McLeod v. General Mills, Inc." on Justia Law

Defendant and the chief financial officer of NRMC signed three documents detailing terms upon which defendant would provide audit services for NRMC. Defendant moved to compel arbitration and to stay proceedings in federal district court pending arbitration. The district court denied the motions. At issue in this interlocutory appeal was whether the "minutes rule," also known as the "minutes requirement," under Mississippi law pertains to the issue of the contract's validity, or instead more closely resembles whether the alleged obligor NRMC ever signed the contract. The court concluded that, with respect to the 2010 and 2012 engagement letters, the minutes rule pertains to whether written agreements between NRMC and defendant were formed in each of those years. Therefore, whether written contracts were consummated was a question for the courts rather than an arbitrator. The court also concluded that because of the minutes requirement, the 2010 and 2012 engagement letters were not contracts to which NRMC was a party. Therefore, NRMC was not a party to the arbitration provisions contained in the 2010 and 2012 engagement letters. The court further concluded that the minutes of NRMC's board reflect that an agreement with defendant was reached in 2009. Therefore, the minutes rule does not pertain to that contract's formation. On remand, the district court should determine the scope of the arbitration agreement. Finally, the court concluded that the Mississippi minutes rule was one of general applicability to Mississippi contracts with public entities and the requirement of section 2 of the Federal Arbitration Act (FAA), 9 U.S.C. 2, that courts must place arbitration agreements on an equal footing with other contracts does not foreclose its application in this case. The court affirmed as to the 2010 and 2012 engagement letters, vacated as to the 2009 engagement letter, and remanded. View "Lefoldt, Jr. v. Rentfro" on Justia Law

Plaintiff opened a credit card account with Defendant Citibank, N.A. and purchased a credit protector plan. Defendant later amended the original agreement by adding an arbitration provision. The provision waived the right to seek public injunctive relief in any forum. The arbitration provision became effective in 2001. In 2011, Plaintiff filed this class action based on Defendant’s marketing of the Plan and the handling of a claim she made under it when she lost her job, alleging claims under the Consumers Legal Remedies Act (CLRA), the unfair competition law (UCL), and the false advertising law. Defendant petitioned to compel Plaintiff to arbitrate her claims on an individual basis pursuant to the arbitration provision. Based on the Broughton-Cruz rule, the trial court ordered Plaintiff to arbitrate all claims other than those for injunctive relief under the UCL, the CLRA, and the false advertising law. The Court of Appeal reversed and remanded for the trial court to order all of Plaintiff’s claims to arbitration, concluding that the Federal Arbitration Act preempts the Broughton-Cruz rule. The Supreme Court reversed, holding that the arbitration provision was invalid and unenforceable because it waived Plaintiff’s right to seek public injunctive relief in any forum. Remanded. View "McGill v. Citibank, N.A." on Justia Law

After an arbitral tribunal in London found the Government of Belize in breach of a settlement agreement with The Bank of Belize Limited, the tribunal ordered that Belize pay the Bank a substantial monetary award. Belize subsequently petitioned for enforcement of the award in district court. The district court granted the petition and Belize appealed, raising multiple challenges. The court accorded Belize's arguments full consideration after careful examination of the record and found them either largely asked and answered by Circuit precedent, or otherwise properly resolved by the district court. The court rejected Belize's argument that the district court's enforcement of the arbitral award violated the New York Convention because it was "contrary to the public policy of" the United States pursuant to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards of June 10, 1958, art. V(2)(b), 21 U.S.T. 2517, T.I.A.S. 2517, T.I.A.S. No. 6997, 330 U.N.T.S. 3 (1970); 9 U.S.C. 207. Accordingly, the court affirmed the judgment. View "Belize Bank Limited v. Government of Belize" on Justia Law

In New Jersey, GTL is the sole provider of telecommunications services that enable inmates to call approved persons outside the prisons. Users can open an account through GTL’s website or through an automated telephone service with an interactive voice-response system. Website users see GTL’s terms of use and must click “Accept” to complete the process. Telephone users receive an audio notice: Please note that your account, and any transactions you complete . . . are governed by the terms of use and the privacy statement posted at www.offenderconnect.com.” Telephone users are not required to indicate their assent to those terms, which contain an arbitration agreement and a class-action waiver. Users have 30 days to opt out of those provisions. The terms state that using the telephone service or clicking “Accept” constitutes acceptance of the terms; users have 30 days to cancel their accounts if they do not agree to the terms. Plaintiffs filed a putative class action alleging that GTL’s charges were unconscionable and violated the state Consumer Fraud Act, the Federal Communications Act, and the Takings Clause. GTL argued that the FCC had primary jurisdiction. Plaintiffs withdrew their FCA claims. GTL moved to compel arbitration. The district court denied GTL’s motion with respect to plaintiffs who opened accounts by telephone, finding “neither the knowledge nor intent necessary to provide ‘unqualified acceptance.’” The Third Circuit affirmed. The telephone plaintiffs did not agree to arbitration. View "James v. Global TelLink Corp." on Justia Law

The right of firefighters and police officers to collectively bargain for purposes of wages, hours, and working conditions was secured through the Police and Firemen Collective Bargaining Act, commonly known as Act 111. Appellant, the International Association of Fire Fighters, Local 302 (“IAFF”), was the exclusive bargaining representative for the firefighters of Appellee, the City of Allentown (the “City”), for purposes of collective bargaining with the City. The City and the IAFF were parties to a seven-year collective bargaining agreement which ran from January 1, 2005 through December 31, 2011. In this appeal by allowance, the issue this case presented for the Supreme Court's review was, in the context of an interest arbitration award, whether a provision requiring a certain minimum number of firefighters on duty per shift is a mandatory subject of bargaining or a non-bargainable managerial prerogative. The Court concluded that the number of required firefighters per shift was a mandatory subject of bargaining, and implicated managerial responsibilities, but did not unduly infringe upon those managerial rights, and, thus, could properly serve as a component of an interest arbitration award. The Court reversed the Commonwealth Court, which held to the contrary. View "City of Allentown v. Int'l Assoc. of Firefighters" on Justia Law