Justia Arbitration & Mediation Opinion Summaries

Plaintiff filed a class action suit against his employer, alleging various Labor Code violations and unfair business practice. Plaintiff had entered into an agreement with his employer, providing that all disputes arising out of his employment would be resolved by arbitration, and the agreement prohibited class arbitration. The trial court denied the employer's motion to compel arbitration under the test laid out in Gentry v. Superior Court. After the trial court's ruling, the Supreme Court held, in Iskanian v. CLS Transportation Los Angeles, LLC, that Gentry’s rule against employment class waivers was preempted by the Federal Arbitration Act (FAA), 9 U.S.C. 1 et seq. The court concluded, however, that this matter is not subject to the FAA and that Gentry’s holding has not been overturned under California law in situations where the FAA does not apply. Accordingly, the court found that the agreement’s class waiver provision is unenforceable. Neither party asserts that class arbitration is appropriate. Therefore, the court affirmed the trial court’s order denying the motion to compel arbitration. View "Garrido v. Air Liquide Industrial U.S. LP" on Justia Law

After an arbitrator determined that a non-compete agreement Andrew Gantman signed as a partner in SingerLewak was enforceable, the trial court denied SingerLewak's petition to confirm the award. The trial court found that the non-compete agreement was unenforceable under California law. However, the court concluded that the general rule prohibiting review of an arbitration award was applicable in this case. The court concluded that judicial review of the award was not appropriate in light of the statutory right and public policy exception to the general rule. Accordingly, the court reversed the judgment of the trial court. View "SingerLewak LLP v. Gantman" on Justia Law

Husband and Wife signed an agreement to arbitrate the issues in their divorce under the Family Law Arbitration Act (FLAA). The family law arbitrator entered conclusions of law providing for legal and physical custody of the parties’ child to be granted to Wife, Husband to pay certain child support obligation, the division of the marital property, Husband to pay certain spousal maintenance costs, and Husband to pay $95,000 of Wife’s attorney’s fees. The trial court entered judgment in accordance with the arbitrator’s decision. Husband appealed the arbitrator’s attorney fee award. Wife cross-appealed other issues. The Supreme Court affirmed, holding (1) in the appellate consideration of an FLAA award, the proper standard of review is the same standard of appellate review that applies to the review of trial court decisions in marriage dissolution cases; and (2) in this case, the family law arbitrator’s award satisfies that standard, and Husband failed to establish that the award of attorney’s fees is not supported by the arbitrator’s findings. View "Masters v. Masters" on Justia Law

Miranda is a former employee of Anderson Enterprises; Hansen is the company’s general manager. During his employment, Miranda signed an “Alternative Dispute Resolution Policy” by which agreed to arbitrate all employment claims and waived the right to arbitrate claims as a class or collective action. In 2013, Miranda filed a purported class action lawsuit, asserting wage and hour claims, including a Private Attorneys General Act (PAGA; Lab. Code, 2698) claim. The trial court found the arbitration agreement valid and enforceable, dismissed the class and representative claims without prejudice based on the arbitration agreement’s waiver, directed Miranda to arbitrate his individual claims, and stayed the superior court proceedings pending completion of arbitration of the individual claims. The court of appeal reversed as to the representative PAGA claim, based on a subsequently-issued California Supreme Court opinion, Iskanian v. CLS Transp. Los Angeles, LLC (2014), under which the waiver is unenforceable. The court noted that Miranda had represented that he would not pursue his individual claims through arbitration and concluded that the PAGA ruling was, therefore, appealable. View "Miranda v. Anderson Enters., Inc." on Justia Law

The Union filed a grievance against Verizon under the collective bargaining agreement (CBA), after Verizon eliminated communications technician positions. At issue on appeal was whether the arbitrator exceeded his power by issuing a substituted award after he determined that he had exceeded his power in the original award. In this case, the arbitrator decided, at least initially, that the issue submitted included both the “minimal additional training” and the “previously held” language in the CBA. While the arbitrator was later persuaded that this was error, Rule 40 of the AAA Labor Arbitration Rules precluded him from making that determination and issuing the substituted award. Accordingly, the court affirmed the district court's judgment that the arbitrator exceeded his power. View "Local Union 824, International Brotherhood of Electrical Workers v. Verizon Florida, LLC" on Justia Law

Athena incurred $1.4 million in losses on investments with Goldman Sachs and believed that Goldman misrepresented the risks, Goldman and Athena participated in arbitration to settle the dispute. Athena asserted misrepresentation, securities fraud, common law fraud and breach of fiduciary duty. After the first panel session, the Financial Industry Regulatory Authority (FINRA) disclosed that a panel member, Timban, had been charged with the unauthorized practice of law based on an appearance in a New Jersey municipal court. Neither party, nor FINRA, objected to Timban’s continued participation; neither party conducted further due diligence. Following a nine-day hearing, the panel ruled in favor of Goldman. Two panel members signed the award, but Timban did not. Under the Subscription Agreement, only two members needed to sign the award for it to have binding effect. After the award, Athena conducted a background investigation on Timban and learned that Timban failed to disclose numerous regulatory complaints against him. The district court ordered a new arbitration hearing, reasoning that Athena’s rights were compromised by an arbitrator who misrepresented his ability to serve and abandoned the panel before its final ruling. The Third Circuit reversed, finding that Athena waived its right to challenge the award. View "Goldman Sachs & Co v. Athena Venture Partners, L.P." on Justia Law

Plaintiff filed a putative class action against Luxottica asserting four causes of action arising out of his employment with Luxottica, including (1) unlawful business practices, (2) failure to pay overtime compensation, (3) failure to provide accurate itemized wage statements, and (4) failure to pay wages when due. The district court subsequently granted Luxottica's motion to compel arbitration and dismissed the first amended complaint. This appeal presents issues of first impression regarding the scope of Federal Arbitration Act (FAA) preemption, 9 U.S.C. 2 et seq., and the meaning of the Supreme Court’s decision in AT&T Mobility LLC v. Concepcion. The court must decide whether the FAA preempts the California rule announced in Iskanian v. CLS Transportation Los Angeles, which bars the waiver of representative claims under the Private Attorneys General Act of 2004 (PAGA), Cal. Lab. Code 2698 et seq. The court concluded that the FAA does not preempt the Iskanian Rule because the Rule leaves parties free to adopt the kinds of informal procedures normally available in arbitration. It only prohibits them from opting out of the central feature of the PAGA’s private enforcement scheme–the right to act as a private attorney general to recover the full measure of penalties the state could recover. Accordingly, the court reversed the district court’s order dismissing the complaint and returned the issue to the district court and the parties to decide in the first instance where plaintiff's representative PAGA claims should be resolved, and to conduct further proceedings. View "Sakkab v. Luxottica Retail N. Am." on Justia Law

Three petitioners sued their former employer and certain of its agents and associates (collectively, “Employer”) asserting minimum wage and overtime claims individually and on behalf of others similarly situated. The district court entered orders compelling individual arbitration of Petitioners’ claims and denying their motions for class certification. Each petitioner signed the same long-form arbitration agreement, which included a clause waiving the right to initiate or participate in class actions. Petitioners sought extraordinary writ relief, contending that Employer’s failure to countersign the long-form agreement made it unenforceable, that the class action waiver violated state and federal law, and, in the case of one petitioner, Employer waived its right to compel arbitration by litigating with him in state and federal court. The Supreme Court denied writ relief, holding that Petitioners’ arguments were unavailing and that the district court did not err in compelling individual arbitration of their claims. View "Tallman v. Eighth Judicial Dist. Court" on Justia Law

Each of these three cases originated with actions asserting claims against nursing homes for personal injuries suffered by nursing home residents and for wrongful death of the residents. In each case, an attorney-in-fact for the resident executed a written document upon the resident’s admission to the nursing home providing that claims or disputes would be submitted to arbitration rather than adjudication in the courts. In each case, the defendant nursing home facility filed a motion to dismiss the action and compel the parties to submit the claims to a formal arbitration proceeding. The circuit court denied the motions on the grounds that the arbitration agreements were not validly formed between the respective nursing home facility and the resident whose interests were thereby affected. By way of motions for interlocutory relief, several nursing home entities sought relief from orders refusing to compel arbitration of the disputes. The Supreme Court denied the motions for interlocutory relief, holding that because the power-of-attorney instruments involved in these cases provided no manifestation of the principal’s intent to delegate to his agent the power to waive a trial by jury, the principal’s assent to the waiver was never validly obtained. View "Extendicare Homes, Inc. v. Whisman" on Justia Law

In 2010, Yan Chen, who had a business interest in a restaurant, entered into a 10-year lease agreement with Russell Realty, LLC, and MRT, LLC. The property to be leased was located in Greenville. The lease agreement was drafted by Russell Realty and contained an arbitration clause. In 2012, Russell Realty and MRT sued Chen along with Qiaoyun He, Joe Zou, and Yami Buffet, Inc., alleging breach of contract. Chen filed a response to the motion, alleging that she had been in China for a few months, and that she had not been personally served with notice of the lawsuit. She subsequently filed a motion to dismiss the complaint, asserting that the lease agreement contained an arbitration clause and that "said complaint[] fails to state any measures that have been taken in lieu of the fulfillment of such agreed Arbitration Clause." The trial court denied both Russell Realty and MRT's motion for a default judgment and Chen's motion to dismiss. About a month after this, Chen filed a motion to compel arbitration, asserting that, as "part of Plaintiffs['] lease agreement, plaintiff[s] agreed to binding arbitration. In 2013, Chen filed a second motion to dismiss, alleging that Russell Realty and MRT had refused to mediate and had refused to arbitrate. Russell Realty and MRT filed an objection to Chen's second motion to dismiss, asserting that "time of the stay set by the court has almost expired and Defendant Yan Chen has not made any movement, act, or effort to seek Arbitration to resolve the issues." Russell Realty and MRT again sought a default judgment against the defendants, including Chen. She asserted that counsel for Russell Realty and MRT had failed to respond to her attempts to seek a settlement before the hiring of a mediator or arbitrator and that, subsequently, she had contacted a mediator/arbitrator and Russell Realty and MRT had not responded to her choice of mediator/arbitrator. The trial court then entered an order stating that the Chen's appeal was moot as the court had not yet entered a final order. In early 2015, the trial court entered an order awarding Russell Realty and MRT $682,050.10 against all the defendants, including Chen, jointly and severally. Chen appealed. Based on its review of the facts in the circuit court record, the Supreme Court reversed with regard to Chen and remanded the case for the trial court to enter an order requiring arbitration in accordance with the terms of the lease agreement. View "Chen v. Russell Realty, LLC" on Justia Law