Justia Arbitration & Mediation Opinion Summaries

When Cruise applied for employment with Kroger in 2007, she completed an employment application, which contained a clause requiring arbitration of employment-related disputes and incorporating by reference Kroger’s Mediation & Binding Arbitration Policy. When Cruise sued, alleging employment discrimination, thel court denied Kroger’s motion to compel arbitration, ruling that Kroger failed to prove the existence of an arbitration agreement. The court was not persuaded the undated four-page arbitration policy attached to Kroger’s moving papers was extant at the time Cruise read and signed the employment application, and that it was the same Arbitration Policy to which the employment application referred. The court of appeal reversed. The arbitration clause in the employment application, standing alone, was sufficient to establish the parties agreed to arbitrate their employment-related disputes, and that Cruise’s claims against Kroger fall within the ambit of the arbitration agreement. The only impact of Kroger’s inability to establish the contents of the 2007 Arbitration Policy is that Kroger failed to establish the parties agreed to govern their arbitration by procedures different from those prescribed in the California Arbitration Act, so the arbitration will be governed by the CAA, rather than by the procedures set forth in the Arbitration Policy. View "Cruise v. Kroger Co." on Justia Law

Section 747 of the Consolidated Appropriations Act of 2010 created an arbitration procedure for automobile dealerships to seek continuation or reinstatement of franchise agreements that had been terminated by Chrysler during bankruptcy proceedings, with the approval of the bankruptcy court. After an arbitral decision favoring the dealer, the manufacturer was required to provide the dealer a “customary and usual letter of intent” to enter into a sales and service agreement. After arbitrations, a trial was held to determine whether Chrysler supplied each prevailing dealer with such a letter. Most of the rejected dealers reached settlements with New Chrysler. The court determined that the remaining dealers had received “customary and usual” letters. The Sixth Circuit agreed that section 747 does not constitute an unconstitutional legislative reversal of a federal court judgment and that the only relief it provides to successful dealers is the issuance of a letter of intent. The letters at issue were “customary and usual,” except one contractual provision that required reversal. Contrary to the district court’s conclusion application Michigan and Nevada state dealer acts is preempted by section 747, because those acts provide for redetermination of factors directly addressed in federally-mandated arbitrations closely related to a major federal bailout. View "Chrysler Grp. LLC v. Sowell Auto., Inc." on Justia Law

This case stemmed from a dispute between Citigroup and ADIA regarding an Investment Agreement under which ADIA invested billions of dollars in Citigroup. At issue is the arbitration clause contained in the Agreement. The court held that the extraordinary remedies authorized by the All Writs Act, 28 U.S.C. 1651(a), cannot be used to enjoin an arbitration based on whatever claim-preclusive effect may result from the district court's prior judgment when that judgment merely confirmed the result of the parties' earlier arbitration without considering the merits of the underlying claims at issue in that arbitration. Because Citigroup has not demonstrated an adequate basis for an extraordinary injunction under the Act, the court affirmed the judgment dismissing Citigroup's complaint and compelling arbitration. View "Citigroup, Inc. v. Abu Dhabi Investment Auth." on Justia Law

Higbie, a Criminal Investigator for the U.S. State Department, contacted equal employment opportunity (EEO) counsel to complain of alleged reprisal by the Department for his activities, which he claimed were protected under the Civil Rights Act. Higbie successfully requested that his complaint be processed through the Department’s alternative dispute resolution program. Higbie repeatedly inquired whether the mediation proceedings would be confidential. State Department representatives confirmed that they would be. Higbie’s supervisors, including Cotter and Thomas, signed the mediation agreement, which included a confidentiality provision. The parties did not resolve their dispute through mediation. Cotter and Thomas provided affidavits to the EEO investigator that discussed Higbie’s statements in the mediation and cast his participation in a negative light. Higbie filed suit, claiming retaliation, discrimination, and violation of the Alternative Dispute Resolution Act. The district court dismissed the ADRA claim. Amending his complaint, Higbie alleged a claim sounding in contract for breach of the confidentiality provision. The Court of Federal Claims concluded that Higbie had not established that the agreement could be fairly read to contemplate money damages, and dismissed his complaint for lack of jurisdiction under the Tucker Act. The Federal Circuit affirmed. View "Higbie v. United States" on Justia Law

Montano filed a putative class action against Wet Seal, alleging that it failed to offer all required meal and rest periods to its California non-exempt retail employees; failed to provide all regular and overtime pay when due or when employment terminated; and failed to provide accurate semi-monthly itemized wage statements, in violation of the Labor and Business and Professions Codes, Industrial Welfare Commission Wage Order No. 7, and Title 8 of the California Code of Regulations. She included a representative claim under the Private Attorneys General Act. Montano propounded discovery requests and Wet Seal responded with objections but no substantive information. Montano moved to compel discovery responses. Before the hearing, Wet Seal moved to compel arbitration of Montano’s individual claims and to stay the action pending completion of arbitration, based on a “Mutual Agreement to Arbitrate Claims." The trial court ultimately denied the motion for arbitration and granted the discovery motion. The court of appeal affirmed. View "Montano v. Wet Seal Retail, Inc." on Justia Law

Bower was hired by Inter-Con in 2007 and executed an arbitration agreement, covering claims for compensation and wages. In 2008, Bower executed a second arbitration agreement that added clauses prohibiting claims on behalf of a class or in a representative capacity and covering claims for breaks and rest periods. After his 2011 termination, Bower filed a putative class action, claiming failure to: provide meal and rest periods, pay wages, provide accurate itemized wage statements, pay wages upon termination, with claims under the Unfair Competition Act and the Private Attorneys General Act. Instead of moving to compel arbitration, Inter-Con answered, asserting, as an affirmative defense, that Bower’s claims were subject to arbitration. Inter-Con responded to discovery, but objected based on the arbitration agreement, and agreed to provide responses only to Bower in his individual capacity. Inter-Con did respond to an interrogatory concerning the number of class members employed during the class period and propounded its own discovery. Bower moved for leave to file an amended complaint to allege a broader class and additional theories and to compel further discovery responses. Inter-Con then moved to compel arbitration. The court held that “Defendant waived the right to arbitrate by propounding and responding to class discovery.” The court of appeal affirmed. View "Bower v. Inter-Con Sec. Sys., Inc." on Justia Law

In May 2014, the City of Reno decided to lay off thirty-two firefighters. The City stated that its decision was based on a lack of funds. A collective bargaining agreement between the City and the International Association of Firefighters, Local 731 (union) provides that the right to lay off employees due to lack of funds is reserved to the City without negotiation. The union and the firefighters who would be laid off (collectively, IAFF) filed a complaint in the district court, claiming that the City had the funds to continue the firefighters’ employment. The IAFF also filed a motion for preliminary injunctive relief. The City filed a motion to dismiss due to the IAFF’s failure to exhaust contractual and administrative remedies. The district court proceeded to enjoin the City from proceeding with the layoffs while the IAFF exhausted its contractual grievance and administrative remedies. The Supreme Court reversed, holding that the underlying grievance was not arbitrable under the parties’ collective bargaining agreement, and therefore, the district court lacked authority to rule on the request for injunctive relief. View "City of Reno v. Int’l Ass’n of Firefighters, Local 731" on Justia Law

When Richmont Holdings, Inc. bought the assets of Superior Recharge Systems, LLC the parties signed an asset Purchase Agreement that contained an arbitration provision. Superior Discharge’s part-owner, Jon Blake, signed an employment contract to continue as general manager of the business. The contract contained a covenant not to compete but not an arbitration provision. After Blake’s employment was terminated, Superior Recharge and Blake (together, Blake) sued Richmont in Denton County for fraud and breach of contract. Richmont then sued Blake individually in Dallas County to enforce the covenant not to compete. The Dallas County suit was subsequently abated. Nineteen months after being sued, Richmont moved to compel arbitration, asserting that Blake’s claims arose out of the Asset Purchase Agreement. The trial court denied the motion, and the court of appeals affirmed. The Supreme Court reversed. On remand, the court of appeals concluded that Richmont had waived arbitration by substantially invoking the judicial process. The Supreme Court reversed, holding that the circumstances of this case did not approach a substantial invocation of the judicial process. Remanded. View "Richmont Holdings, Inc. v. Superior Recharge Sys., LLC" on Justia Law

Plaintiffs sought declaratory and injunctive relief against defendants in this action. But the complaint explicitly acknowledged it was “ancillary to” contemplated private arbitration of disputes arising out of the parties’ contractual relationship. The trial court denied plaintiffs’ motion for a preliminary injunction and the parties stipulated to stay the action “pending arbitration.” Plaintiffs voluntarily dismissed this action (purportedly without prejudice) after the claims were submitted to an arbitrator for final resolution and the arbitrator had issued an interim award in favor of defendants. The interim arbitral award was made final without substantive revision, except for adding plaintiff’s attorney fees and costs incurred in the arbitration. The trial court denied defendants’ motion to vacate the dismissal, reasoning that the arbitration and this case were separate proceedings and that plaintiffs had dismissed this action before trial commenced. After its review, the Court of Appeal disagreed with this reasoning and reversed: this lawsuit was based on the same causes of action submitted to the arbitrator; it differed only in the remedies sought. Once the hearing on the merits of the parties’ dispute commenced at the arbitration, it was too late for plaintiffs to dismiss this action without prejudice and thereby avoid an attempt by defendants to recover attorney fees as the prevailing party in this action. View "Mesa Shopping Center-East v. O Hill" on Justia Law

Bell sued attorney Ruben and his firm, alleging that they negligently and fraudulently mismanaged her trust, causing a loss of $34 million. Before arbitration, Ruben filed for Chapter 7 bankruptcy. Bell filed an adversary complaint opposing discharge of Ruben’s fraud-based debt to her, 11 U.S.C. 523(a)(2)(A), (4). The bankruptcy judge granted Ruben a discharge of his other debts, but not of that fraud debt. Ruben’s liability insurance did not cover fraud. Bell settled her negligence claims against Ruben and all claims against the other defendants in arbitration. The arbitration panel ruled, with respect to the fraud claim, that “damages proven to be attributable to the actions of [Ruben] have been compensated,” but ordered Ruben to pay administrative fees and expenses of the American Arbitration Association (AAA) totaling $21,200.00 and that compensation and expenses of the arbitrators, advanced by Bell, totaling $150,304.54 would be borne by Ruben. AAA rules, which governed the arbitration, provide that expenses of arbitration “shall be borne equally” unless the parties agree otherwise or the arbitrator assesses expenses against specified parties. Ruben refused to pay. The bankruptcy judge entered summary judgment in favor of Ruben. The district court reversed, in favor of Bell. The Seventh Circuit affirmed. View "Ruben v. Bell" on Justia Law