Justia Arbitration & Mediation Opinion Summaries

This case arose from a dispute over the adequacy of concrete work Nordic PCL Construction, Inc. performed on a condominium construction project as a subcontractor to LPIHGC, LLC. The parties proceeded to arbitration. An arbitrator selected by the parties issued an arbitration award in favor of LPIHGC. LPIHGC moved to confirm, and Nordic moved to vacate, the arbitration award. The circuit court denied the motion to vacate and granted the motion to confirm. The Intermediate Court of Appeals (ICA) vacated the arbitration award on the grounds that the arbitrator failed to disclose various relationships with the law firms of LPIHGC’s attorneys. The Supreme Court vacated the ICA’s judgment on appeal and the circuit court’s final judgment, thereby vacating the associated orders granting LPIHGC’s motion to confirm the arbitration award and denying Nordic’s motion to vacate the arbitration award, holding that because the factual and/or legal bases upon which the circuit court denied the motion to vacate were unascertainable, the Supreme Court was unable to appropriately review the circuit court’s ruling. Remanded for an evidentiary hearing and entry of findings of fact and conclusions of law on Nordic’s motion to vacate. View "In re Arbitration of Nordic PCL Constr., Inc. v. LIPHGC, LLC" on Justia Law

Plaintiff appealed from the district court’s order dismissing his action in favor of arbitration. Opus Bank cross appealed from the district court’s implicit denial of its motion to seal plaintiff’s complaint, and the district court’s denial of its motion for reconsideration as moot. The court held that federal arbitrability law applies in the present case; that the district court did not err in concluding that these parties’ incorporation of the Rules of the American Arbitration Association (AAA) constituted “clear and unmistakable” evidence of their intent to submit the arbitrability dispute to arbitration; that Rent-A-Center, West, Inc. v. Jackson controls the present case where there are multiple severable arbitration agreements, only one of which is at issue; and that in this case, plaintiff failed to challenge the specific agreement at issue, as Rent-A-Center requires. The court concluded that the district court erred in denying as moot Opus Bank's motion for reconsideration to seal plaintiff's complaint because final judgment and even the filing of a notice of appeal does not divest a district court of its jurisdiction over matters ancillary to the appeal, such as protective orders. Accordingly, the court affirmed in part, and vacated and remanded in part. View "Brennan v. Opus Bank" on Justia Law

This appeal stems from a franchise dispute between Dickey's and several of its franchisees in Maryland. At issue was whether the parties’ claims should be arbitrated, as Dickey’s argues, or heard in federal court in Maryland, as the franchisees contend. The court concluded that the clear and unambiguous language of the provisions in the parties' franchise agreement requires that the common law claims asserted by Dickey’s must proceed in arbitration, while the franchisees’ Maryland Franchise Law claims must proceed in the Maryland district court. Accordingly, the court reversed the district court's judgment and instructed the district court to compel arbitration of the common law claims only. The court left it to the district court’s discretion whether to stay the franchisees’ Maryland Franchise Law claims pending conclusion of the arbitration. View "Chorley Enter. v. Dickey's Barbecue Restaurants" on Justia Law

Devon acquired the rights to distribute robotic medical devices, CytoCare and i.v. Station, from Robotics. DeViedma, Robotics's general counsel, negotiated the contracts. Each contained an arbitration clause. Robotics later agreed to provide management consulting services through DeViedma. DeViedma allegedly obstructed a possible sub-licensing contract with McKesson; Devon failed to make franchise payments, leading Robotics to draw down a $5 million line of credit from Itochu, guaranteed by Devon. Itochu eventually sued Devon. The parties terminated the management consulting services. Robotics terminated Devon's CytoCare contract and entered into an agreement with McKesson. Robotics also alleged breaches of the i.v. Station agreement. DeViedma e-mailed hospital customers telling them that Devon faced financial difficulties and lacked staff qualified to manage i.v. Station installations. Devon sued DeViedma and McKesson, claiming breach of fiduciary duty, tortious interference with current and prospective contractual relations, defamation, and conspiracy. The court rejected a motion to dismiss in favor of arbitration. DeViedma did not appeal that order. Extensive litigation followed. DeViedma later moved for summary judgment on the remaining claims for breach of fiduciary duty and tortious interference with contractual relations. The court rejected his arguments in favor of arbitration. The Third Circuit dismissed DeViedma’s interlocutory appeal, rejecting an argument that the denial of summary judgment was an appealable order under the Federal Arbitration Act, 9 U.S.C. 16(a)(1)(C). View "Devon Robotics LLC v. DeViedma" on Justia Law

This appeal arose from a dispute between Ecuador and Chevron involving a series of lawsuits related to an investment and development agreement. On appeal, Ecuador challenged the district court's confirmation of an international arbitral award to Chevron. In this case, the Bilateral Investment Treaty (BIT) includes a standing offer to all potential U.S. investors to arbitrate investment disputes, which Chevron accepted in the manner required by the treaty. Therefore, the court concluded that the Foreign Sovereign Immunities Act (FSIA), 28 U.S.C. 1604, allows federal courts to exercise jurisdiction over Ecuador in order to consider an action to confirm or enforce the award. The dispute over whether the lawsuits were “investments” for purposes of the treaty is properly considered as part of review under the Convention on the Recognition of Foreign Arbitral Awards (New York Convention), 9 U.S.C. 201-208. The court further concluded that, even if it were to conclude that the FSIA required a de novo determination of arbitrability, the court still would find that the district court had jurisdiction where Ecuador failed to demonstrate by a preponderance of the evidence that Chevron's suits were not "investments" within the meaning of the BIT. Likewise, the court rejected Ecuador's arguments against confirmation of the award under the New York Convention as meritless. Accordingly, the court affirmed the judgment. View "Chevron Corp. v. The Republic of Ecuador" on Justia Law

In this dispute over the sale of a car, Plaintiff filed a class action lawsuit against Defendant, alleging, inter alia, that Defendant violated the Consumer Legal Remedies Act by making false representations about the condition of the automobile. Defendant filed a motion to compel arbitration pursuant to an arbitration clause in the sale contract that had a class action waiver. The trial court denied the motion, concluding that the class waiver was unenforceable, and therefore, the entire arbitration agreement was unenforceable. After the trial court’s decision was filed, the United States Supreme Court in AT&T Mobility LLC v. Concepcion held that the Federal Arbitration Act (FAA) preempts California’s unconscionability rule prohibiting class waivers in consumer arbitration agreements. On appeal, the Court of Appeal declined to address whether the class waiver at issue was enforceable and instead held that the arbitration appeal provision and the arbitration agreement as a whole were unconscionably one-sided in favor of Defendant. The Supreme Court reversed, holding that the Court of Appeal erred as a matter of state law in finding the agreement unconscionable, as, in light of Concepcion, the FAA preempts the trial court’s invalidation of the class waiver on unconscionability grounds. View "Sanchez v. Valencia Holding Co., LLC" on Justia Law

A district elementary school principal interpreted an educational policy to mean that elementary school teachers were expected to be present in their classrooms ten minutes before the start of the instructional day. The Coastal Education Association, an affiliate of a union representing teachers, filed a grievance with Regional School District Unit No. 5 (RSU No. 5) challenging the principal’s interpretation as a violation of the collective bargaining agreement (CBA) between the Association and the Board of Directors of RSU No. 5. An arbitrator concluded that the principal’s directive violated the CBA and directed RSU No. 5 to rescind the educational policy. RSU No. 5 filed an application to vacate the arbitration award. The superior court granted the application, concluding that the dispute was not substantively arbitrable pursuant to the Municipal Public Employees Labor Relations Law, which prevents school boards from bargaining on matters of educational policy or submitting educational policy disputes to interest arbitration. The Supreme Judicial Court affirmed, holding that the trial court did not err in concluding that the educational policy at issue in this case was, as a matter of law, not substantively arbitrable. View "Reg’l Sch. Unit No. 5 v. Coastal Educ. Ass’n" on Justia Law

A district elementary school principal interpreted an educational policy to mean that elementary school teachers were expected to be present in their classrooms ten minutes before the start of the instructional day. The Coastal Education Association, an affiliate of a union representing teachers, filed a grievance with Regional School District Unit No. 5 (RSU No. 5) challenging the principal’s interpretation as a violation of the collective bargaining agreement (CBA) between the Association and the Board of Directors of RSU No. 5. An arbitrator concluded that the principal’s directive violated the CBA and directed RSU No. 5 to rescind the educational policy. RSU No. 5 filed an application to vacate the arbitration award. The superior court granted the application, concluding that the dispute was not substantively arbitrable pursuant to the Municipal Public Employees Labor Relations Law, which prevents school boards from bargaining on matters of educational policy or submitting educational policy disputes to interest arbitration. The Supreme Judicial Court affirmed, holding that the trial court did not err in concluding that the educational policy at issue in this case was, as a matter of law, not substantively arbitrable. View "Reg’l Sch. Unit No. 5 v. Coastal Educ. Ass’n" on Justia Law

After the district court found plaintiff's state law claims against Verizon to be arbitrable, the district court compelled arbitration but denied Verizon's request to stay proceedings. The court held, however, that the text, structure, and underlying policy of the Federal Arbitration Act, 9 U.S.C.1 et seq., requires a stay of proceedings when all claims are referred to arbitration and a stay requested. The court further concluded that plaintiff's various constitutional challenges to the FAA are meritless. Accordingly, the court affirmed in part, vacated in part, and remanded for further proceedings. View "Katz v. Cellco P'ship" on Justia Law

Bowman law firm filed suit in Hendricks County Indiana, to recover Bentrud’s credit card debt owed to Capital One. Months later, Bowman moved for summary judgment. Bentrud responded by invoking the arbitration provision in his credit card agreement. The state court granted Bentrud’s election of arbitration and stayed the case, allowing Bentrud 30 days to initiate arbitration. The American Arbitration Association declined to do the arbitration because Capital One had previously failed to comply with its policy regarding consumer claims. Bentrud failed to meet the 30-day deadline, so that the stay automatically dissolved. Bowman filed a second summary judgment motion. Although the state court granted an extension, Bentrud characterized that motion, as an unfair or unconscionable means of attempting to collect a debt, under the Fair Debt Collection Practices Act, 15 U.S.C. 1692f. Bentrud also claimed that the Annual Percentage Rate on his credit card debt was 13.9%, but when Bowman filed its state court complaint, it averred the applicable interest rate to be 10.65%. The Seventh Circuit affirmed judgment in favor of Bowman, noting that when Bowman filed a second summary judgment motion, it acted consistently with the state court order and that any interest rate violation would be attributable to Capital One, which was not a party. View "Bentrud v. Bowman, Heintz, Boscia & Vicia, P.C." on Justia Law