Justia Arbitration & Mediation Opinion Summaries

When James Maddalena, a correctional officer with the Department of Corrections (DOC), admitted that another officer was smoking marijuana, in his presence, while on duty, Maddalena was terminated from employment with the DOC. The Rhode Island Brotherhood of Correctional Officers (RIBCO) filed a grievance on behalf of Maddalena in accordance with its collective bargaining agreement (CBA), contending that Maddalena was terminated without just cause. The matter proceeded to arbitration. An arbitrator determined that there was not just cause for Maddalena’s termination and provided that Maddalena be suspended without pay for sixty days. A justice of the superior court granted the DOC’s motion to vacate the arbitration award and denied RIBCO’s motion to confirm the award, determining that the arbitrator exceeded his authority and reached an irrational result because his decision was based upon a manifest disregard of the CBA. The Supreme Court affirmed, holding that the trial justice did not err in concluding that the arbitrator manifestly disregarded the CBA and that the arbitration award was irrational. View "State Dep’t of Corr. v. R.I. Brotherhood of Corr. Officers" on Justia Law

Plaintiff filed suit against his employer, Archstone, in California state court alleging, among other claims, unlawful retaliation in violation of Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq., and equivalent state-law claims. Archstone moved to federal district court. On appeal, Archstone challenged the district court's denial of its motion to compel arbitration pursuant to a Company Policy Manual containing a Dispute Resolution Policy. The court concluded, pursuant to Kummetz v. Tech Mold, Inc., that the scope of the Federal Arbitration Act (FAA), 9 U.S.C. 2, is narrowed by other federal statutes, such as Title VII, which "limit the enforcement of arbitration agreements with regard to claims arising under" the statute. This case is distinguishable from Kummetz and Nelson v. Cyprus Bagdad Copper Corp. where the acknowledgment that plaintiff signed explicitly notified plaintiff that the Manual contained a Dispute Resolution Policy. Archstone presented plaintiff the "express" choice lacking in both Kummetz and Nelson and plaintiff knowingly waived his right to judicial forum for claims. Accordingly, the court reversed and remanded. View "Ashbey v. Archstone Prop. Mgmt." on Justia Law

The Andermanns obtained mobile phone service from U.S. Cellular in 2000. Their renewable two-year contract was renewed for the last time in 2012. It included an arbitration clause that “survives the termination of this service agreement” and provided that “U.S. Cellular may assign this Agreement … without notice.” In 2013 U.S. Cellular sold the Andermanns’ contract to Sprint, without notice to the Andermanns. Months later Sprint sent Andermanns a letter, informing them of the sale and that their mobile service would be terminated on January 31, 2014 because Andermanns’ phones were not compatible with Sprint’s network. In December Sprint phoned to remind them that their service was about to expire, and added that Sprint had “a great set of offers and devices available to fit [their] needs.” Sprint made six such calls. Andermanns answered none, but filed a purported class action, contending that the unsolicited advertisements contained in the calls violated the Telephone Consumer Protection Act, 47 U.S.C. 227. Sprint requested arbitration, 9 U.S.C. 4. The district court denied Sprint’s motion. The Seventh Circuit reversed, finding connection to the contract, asking: What would Sprint have done if forbidden to call the customers whom it had inherited from U.S. Cellular and must now terminate because of technical incompatibility? View "Andermann v. Sprint Spectrum, L.P." on Justia Law

IBI Group, Michigan, LLC, f/k/a Giffels, LLC ("Giffels"), appealed a circuit court order ordering it to arbitrate its claims against Outokumpu Stainless USA, LLC, f/k/a ThyssenKrupp Stainless USA, LLC ("OTK"), and ThyssenKrupp Steel USA, LLC, f/k/a ThyssenKrupp Steel and Stainless USA, LLC ("TK Steel") (collectively, "the steel companies"), pursuant to an arbitration provision in the contracts at the center of this dispute. Giffels initiated this action after the steel companies commenced arbitration proceedings once it became apparent that the action the steel companies had initiated in the federal district court involving the same contract dispute would be dismissed for lack of subject-matter jurisdiction. The trial court thereafter granted the steel companies' motion to stay the action pending the completion of arbitration, and Giffels appealed, arguing that, under the circumstances, the steel companies either had no right to compel arbitration or had waived that right. The Supreme Court found that the language of the arbitration provisions in the contracts executed by the parties gave the steel companies the broad right to select arbitration as a method to resolve any disputes based on those contracts, and, because Giffels failed to demonstrate substantial prejudice as a result of the steel companies' actions, the steel companies did not waive their right to proceed in arbitration. Accordingly, the order of the trial court sending the case to arbitration and staying all proceedings pending the completion of the arbitration of the claims presented in this action was affirmed. View "IBI Group, Michigan, LLC v. Outokumpu Stainless USA, LLC" on Justia Law

The Tenth Circuit Court of Appeals certified a question of Oklahoma law to the Oklahoma Supreme Court. In April 2008, plaintiffs Shannon and Eric Walker requested several samples of hardwood flooring from BuildDirect.com Technologies, Inc., a Canadian corporation, through BuildDirect's website. The next month they arranged, over the telephone, to purchase 113 boxes of flooring from BuildDirect. BuildDirect emailed a two-page written Contract entitled "Quotation" to Ms. Walker, who signed and dated the Contract and returned it to BuildDirect via fax. The Contract described the type, amount, and price of the flooring purchased by the Walkers. And, it included 14 bullet points setting forth additional terms. The sixth bullet point stated: "All orders are subject to BuildDirect's 'Terms of Sale.'" The Walkers alleged that after they installed the flooring, they discovered that their home was infested with nonindigenous wood-boring insects. According to the Walkers, the insects severely damaged the home, and caused the home to be subject to quarantine and possible destruction by the United States Department of Agriculture. The question the federal appeals court posed to the Oklahoma Supreme Court was whether a written consumer contract for the sale of goods incorporated by reference a separate document entitled "Terms of Sale" available on the seller's website, when the contract stated that it was "subject to" the seller's "Terms of Sale" but did not specifically reference the website. In response, the Oklahoma Court held that Oklahoma law did not recognize a "vague attempt at incorporation by reference" as demonstrated in this case. Under the Oklahoma law of contracts, parties may incorporate by reference separate writings, or portions thereof, together into one agreement where: (1) the underlying contract makes clear reference to the extrinsic document; (2) the identity and location of the extrinsic document may be ascertained beyond doubt; and (3) the parties to the agreement had knowledge of and assented to its incorporation. View "Walker v. BuildDirect.com Technologies, Inc." on Justia Law

Before suing for employment discrimination under Title VII of the Civil Rights Act of 1964, the Equal Employment Opportunity Commission (EEOC) must “endeavor to eliminate [the] alleged unlawful employment practice by informal methods of conference, conciliation, and persuasion,” 42 U. S. C. 2000e–5(b). Nothing said or done during conciliation may be “used as evidence in a subsequent proceeding without written consent of the persons concerned.” After investigating a sex discrimination charge against Mach Mining, EEOC determined that reasonable cause existed to believe that the company had engaged in unlawful hiring practices and invited the parties to participate in informal conciliation. A year later, EEOC sent Mach another letter stating that conciliation efforts had been unsuccessful, then filed suit. Mach alleged that EEOC had not attempted to conciliate in good faith. The Seventh Circuit held that EEOC’s statutory conciliation obligation was unreviewable. The Supreme Court vacated, noting a “strong presumption” that Congress means to allow judicial review of administrative action. EEOC’s argument that review is limited to checking the facial validity of its two letters falls short of Title VII’s demands; the aim of judicial review is to verify that the EEOC actually tried to conciliate. The Court rejected Mach’s proposal for specific requirements or a code of conduct as conflicting with the wide latitude Congress gave EEOC and with Title VII’s confidentiality protections. A sworn affidavit from EEOC that it informed the employer about the specific discrimination allegation and tried to engage the employer in a discussion to give the employer a chance to remedy the allegedly discriminatory practice should suffice. Should the employer present concrete evidence that the EEOC did not provide the requisite information or attempt to engage in conciliation, a court must conduct the fact-finding necessary to resolve that limited dispute. View "Mach Mining, LLC v. Equal Emp't Opportunity Comm'n" on Justia Law

Matthew Viscito, Mary Lynn Berntson, and Florence Properties, LLC (collectively "Viscito") appeal from a district court judgment of dismissal without prejudice, which awarded Kevin Christianson, Pace's Lodging Corporation, Mednational, LLC, Aurora Medical Park No. 2, LLC, and Jeff Sjoquist (collectively "Christianson") attorney's fees and costs. Viscito sued Christianson alleging a number of claims pertaining to an agreement the parties entered to build, own, and lease a hospital. Christianson moved to compel arbitration, contending the agreement required that Viscito's claims be resolved through arbitration. The district court granted the motion to compel arbitration and ordered the parties complete arbitration within six months from the date of the order. Viscito moved for an extension of time to complete arbitration. Christianson moved to dismiss with prejudice and requested an award of attorney's fees and costs. The district court held a hearing on the motions; at the conclusion, the district court ruled from the bench that the case be dismissed without prejudice and awarded Christianson reasonable attorney's fees and costs. The district court requested Christianson submit an itemized billing statement of its attorney's fees, so the court could determine the reasonableness of the fees. Christianson submitted an affidavit requesting $33,405.14, the full amount of fees and costs it had incurred defending the entire case, along with itemized billing statements documenting the work performed from July 6, 2012, to April 7, 2014, totaling the amount requested. The district court dismissed the case without prejudice and awarded Christianson $33,405.14 in attorney's fees and costs. Viscito appealed, arguing the district court abused its discretion in awarding Christianson all of its costs and attorney's fees incurred throughout the case because the court misinterpreted the rules authorizing sanctions. The Supreme Court agreed with Viscito, reversed and remanded the case for recalculation of the fees. View "Viscito v. Christianson" on Justia Law

Plaintiff, a former employee of the St. Louis Rams Partnership, filed an action claiming age discrimination against the Partnership and three of its affiliates. The Rams moved to compel arbitration, citing an arbitration provision of Plaintiff’s employment contract. The trial court granted the motion and ordered that the court action be stayed pending arbitration. Plaintiff petitioned for a writ of mandamus preventing the trial court from compelling arbitration of this dispute. Four judges of the Supreme Court issued a permanent writ of mandamus directing the trial court to vacate its order granting the motion to compel arbitration and to issue an order to compel arbitration whereby the trial court appoints a neutral arbitrator and implies the specific terms of arbitration from applicable statutes in Missouri’s uniform arbitration act, holding (1) the terms of Plaintiff’s employment contract designating the commissioner of the National Football League (NFL) as the sole arbitrator with unfettered discretion to establish the rules for arbitration are unconscionable and, therefore, unenforceable; and (2) Missouri’s uniform arbitration act provides a mechanism to imply the terms missing from the arbitration agreement and provides the rules for appointing an arbitrator to replace the NFL commissioner. View "State ex rel. Hewitt v. Hon. Kerr" on Justia Law

A skilled nursing facility (Plaintiff) terminated an employee (Employee) on the ground that she had failed to make a timely report of an allegation of resident abuse. An arbitrator agreed with Plaintiff that the Employee had improperly delayed reporting an incident of suspected abuse but ordered the Employee reinstated based upon its determination that Plaintiff had just cause to suspend Employee without pay for one month. The trial court denied Plaintiff’s application to vacate the arbitration award. The Appellate Court reversed, concluding that the arbitration award reinstating the Employee’s employment violated Connecticut’s clear public policy requiring the prompt reporting of any incident of suspected abuse of a nursing home resident. The Supreme Court reversed, holding that the arbitration award requiring the reinstatement of the Employee did not violate this public policy. View "Burr Road Operating Co. II, LLC v. New England Health Care Employees Union" on Justia Law

Benihana America obtained a preliminary injunction in aid of arbitration of a dispute arising under its license agreement with Benihana of Tokyo, prohibiting Tokyo from: selling unauthorized food items at the restaurant it operates under the license agreement; using certain trademarks in connection with that restaurant in a manner not approved by the license agreement; and arguing to the arbitral panel, if it rules that Tokyo breached the license agreement, that Tokyo should be given additional time to cure any defaults. The Second Circuit affirmed with respect to the menu offering and trademark use injunctions. The court reasonably concluded that each of the relevant factors favored Benihana America. The court reversed the prohibition on arguing to the arbitral panel for an extended cure period. When a dispute is properly before an arbitrator, a court should not interfere with the arbitral process on the ground that, in its view of the merits, a particular remedy would not be warranted. Benihana America may challenge an arbitrator’s decision in court only after it has been issued. It may not subvert its agreement to arbitrate by obtaining an advance judicial determination that there are no grounds for the arbitrator to grant a particular remedy. View "Benihana, Inc. v. Benihana of Tokyo, LLC" on Justia Law