Justia Arbitration & Mediation Opinion Summaries

Betty Smith brought a negligence and wrongful death lawsuit against Belhaven Senior Care, LLC (Belhaven), a nursing home facility in which her mother Mary Hayes had resided shortly before Hayes’s death. Belhaven sought to compel arbitration, citing the arbitration provision in the nursing home admissions agreement Smith signed when admitting her mother. The trial judge denied arbitration, finding that Smith lacked the legal authority to bind her mother to the agreement. Belhaven appealed. The nursing home’s primary argument on appeal was that under the Health-Care Decisions Act (“the Act”), Smith acted as a statutory healthcare surrogate. So in signing the nursing home admission agreement, Smith had authority to waive arbitration on her mother’s behalf. In addition, Belhaven puts forth arguments of direct-benefit estoppel and third-party beneficiary status. The Mississippi Supreme Court affirmed, finding that while Hayes did suffer from some form of dementia, when admitted to the nursing home, she was neither evaluated by a physician nor was she determined to lack capacity. Indeed, her “Admission Physician Orders” were signed by a nurse practitioner. It was not until eleven days later that a physician evaluated Hayes. "And even then, the physician did not deem she lacked capacity. In fact, Belhaven puts forth no evidence that—at any time during her stay of more than a year at Belhaven—any physician ever determined Hayes lacked capacity." The Court determined Belhaven failed to prove the strict requirements of the surrogacy statute to rebut this presumption. Furthermore, the Court found Belhaven’s direct-benefit estoppel and third-party beneficiary arguments were lacking: because Belhaven contends that Hayes was incapacitated, she could not knowingly seek or obtain benefits from the agreement. "Nor does Smith’s largely negligence-based lawsuit seek to enforce the contract’s terms or require determination by reference to the contract. So Smith is not estopped from pursuing these claims." View "Belhaven Senior Care, LLC, et al. v. Smith, et al." on Justia Law

In 2013, New Balance entered into a Distribution Agreement with PSG to distribute its products in Peru. The Agreement contained an arbitration clause, which New Balance invoked in 2018. Also joined as respondents in this arbitration were Ribadeneira, PSG’s controlling owner, and Superdeporte, another business entity owned by Ribadeneira in Peru. The arbitrator issued two awards, which imposed liability on PSG and Superdeporte for breach of the Distribution Agreement, and on PSG, Superdeporte, and Ribadeneira for tortious interference. The arbitrator rejected three counterclaims brought against New Balance. Finding that the arbitrator had improperly exercised jurisdiction over nonsignatories Ribadeneira and Superdeporte, the district court vacated the awards.The First Circuit reversed. Theories of assumption and equitable estoppel apply to support arbitral jurisdiction over Ribadeneira and Superdeporte. Superdeporte was PSG's successor-in-interest and assumed PSG's obligation to arbitrate under the Distribution Agreement. Ribadeneira is estopped from denying that the Agreement's arbitration clause is enforceable, just as he is estopped from asserting his nonsignatory status to avoid the obligation to arbitrate under that clause. The tortious interference claims were "related to or arising out of" the Agreement. View "Ribadeneira v. New Balance Athletics, Inc." on Justia Law

Integra is an accountable-care organization under the Medicare Shared Savings Program (MSSP). RIPCPC is an independent practice association of physicians located in Rhode Island. The plaintiffs (Hayden, King, Corsi) are primary care physicians and operated their own independent practices. Each participated in Integra until 2018, when they terminated their respective agreements upon the sale of their respective independent practices (Integra agreements) and terminated their relationships with RIPCPC. The plaintiffs alleged breach of contract, unjust enrichment, breach of the implied covenant of good faith and fair dealing, conversion, and anticipatory breach/repudiation against Integra and RIPCPC, claiming that Integra and RIPCPC owed plaintiffs certain payments and shared savings for 2017 and 2018.The defendant’s motion to dismiss was granted as to breach of the implied covenant of good faith and fair dealing by RIPCPC and anticipatory breach/repudiation by RIPCPC. RIPCPC then successfully moved to stay the proceedings and compel arbitration as to plaintiffs’ claims against RIPCPC for breach of contract, unjust enrichment, conversion, and declaratory judgment. The Rhode Island Supreme Court held that the hearing justice did not err in granting RIPCPC’s motion to compel arbitration with regard to Hayden’s claims for breach of contract, conversion, and unjust enrichment nor in granting RIPCPC’s motion to compel arbitration with regard to Corsi’s claim for breach of contract but erred in granting RIPCPC’s motion to compel arbitration with regard to Corsi’s claims and King’s claims for conversion and unjust enrichment. View "Hayden v. Integra Community Care Network, LLC" on Justia Law

Plaintiff, doing business as The Soni Law Firm (collectively Soni), appealed from a judgment awarding attorney fees under the Mandatory Fee Arbitration Act (MFAA in favor of Defendants Timothy Tierney and Cartograph, Inc., formerly known as Simplelayers, Inc. (collectively Tierney). On appeal, Soni contends: he was the prevailing party for the purposes of an attorney fees award under sections 6203 and 6204; he was also the prevailing party under the parties’ contractual attorney fees provisions; he was entitled to an award of attorney fees because he was not a self-represented litigant; and even if Tierney were entitled to fees, the amount was excessive.   The Second Appellate District affirmed. The court held that the statutory attorney fees provisions of sections 6203 and 6204 govern rather than the attorney fees provision of the parties’ contract. The trial court properly awarded attorney fees to Tierney as the prevailing party under sections 6203 and 6204. Further, Tierney’s attorneys worked half as many hours as Soni’s attorneys on the matters at issue, and Tierney’s attorneys billed substantially lower total fees than the charges that Soni incurred and sought to recover in his competing motion for attorney fees. The trial court examined the bills carefully and reduced the amount awarded to Tierney for duplicative work by one attorney. Accordingly, the court held that no abuse of discretion has been shown as to the amount of fees awarded. View "Soni v. Cartograph, Inc." on Justia Law

Plaintiffs filed claims against the Ford Motor Company (FMC) for alleged defects in vehicles the company manufactured. FMC filed a motion to compel arbitration of plaintiffs’ claims based on the arbitration provision in the sale contracts. Plaintiffs opposed FMC’s motion, including on the grounds that FMC had waived its right to compel arbitration through its litigation conduct. The trial court denied FMC’s motion on its merits.   The Second Appellate District affirmed. The court explained that it agreed with the trial court that FMC could not compel arbitration based on Plaintiffs’ agreements with the dealers that sold them the vehicles. Equitable estoppel does not apply because, contrary to FMC’s arguments, Plaintiffs’ claims against it in no way rely on the agreements. FMC was not a third-party beneficiary of those agreements, as there is no basis to conclude Plaintiffs and their dealers entered into them with the intention of benefitting FMC. And FMC is not entitled to enforce the agreements as an undisclosed principal because there is no nexus between Plaintiffs’ claims, any alleged agency between FMC and the dealers, and the agreements. View "Ford Motor Warranty Cases" on Justia Law

Direct Biologics, LLC (“DB”) brought claims for breach of covenant to not compete and misappropriation of trade secrets against Adam McQueen, DB’s former employee, and Vivex Biologics, Inc. (“Vivex”), McQueen’s new employer. After granting DB a temporary restraining order based on its trade secret claims, the district court denied DB’s application for a preliminary injunction. Finding that DB’s claims were subject to arbitration, the district court also dismissed DB’s claims against McQueen and Vivex and entered final judgment.   The Fifth Circuit vacated the district court’s orders denying DB’s motion for a preliminary injunction and dismissing DB’s claims and remanded. The court held that the district court did not abuse its discretion by declining to presume irreparable injury based on McQueen’s breach of his non-compete covenants. The court held that remand is thus proper to allow the district court to make particularized findings regarding irreparable harm; specifically, the likelihood of misuse of DB’s information and the difficulty of quantifying damages should such misuse occur. View "Direct Biologics v. McQueen" on Justia Law

The Supreme Court affirmed the orders of the superior court granting motions to stay the superior court proceedings in four cases and refer them to arbitration in this construction dispute, holding that that superior court correctly found that these disagreement must be resolved through arbitration.Plaintiff substituted itself as the plaintiff and assignee of three subcontractors in in three mechanics' liens actions and then filed an additional complaint against the assignee of nine further subcontractors. Plaintiff further filed a complaint claiming it was owed $854,352 from Defendants. Defendants moved to stay the proceedings in all five cases and refer them to arbitration. The trial justice found that the language of the subcontracts required mandatory arbitration for the disputes and compelled the parties to participate in mandatory arbitration. The Supreme Court affirmed, holding that the disputes must be referred for arbitration. View "Petrolex II LLC v. Bailey Group LLC" on Justia Law

Plaintiff, a former driver for Defendant Lyft, Inc., filed suit against Lyft under the Private Attorneys General Act of 2004 (PAGA). He alleged that Lyft misclassified him and other drivers as independent contractors rather than employees, thereby violating multiple provisions of the Labor Code. Lyft moved to compel arbitration based on the arbitration provision in the “Terms of Service” (TOS) that it required its drivers to accept. The trial court denied the motion, finding the PAGA waiver in the arbitration provision unenforceable under then-controlling California law. Lyft appealed, and the Second Appellate District affirmed the denial of Lyft’s motion to compel arbitration. Lyft petitioned the United States Supreme Court for a writ of certiorari. The Court granted Lyft’s petition and remanded the case for further consideration in light of Viking River Cruises, Inc. v. Moriana (2022).   The Second Appellate District reversed in part and affirmed in part the trial court’s order. The court remanded the matter to the trial court with directions to (1) enter an order compelling Plaintiff to arbitrate his individual PAGA claim and (2) conduct further proceedings regarding Plaintiff’s non-individual claims. The court explained that it is not bound by the analysis of PAGA standing set forth in Viking River. PAGA standing is a matter of state law that must be decided by California courts. The court explained that until it has guidance from the California Supreme Court, its review of PAGA and relevant state decisional authority leads the court to conclude that a plaintiff is not stripped of standing to pursue non-individual PAGA claims simply because their individual PAGA claim is compelled to arbitration. View "Seifu v. Lyft, Inc." on Justia Law

Vivera Pharmaceuticals, Inc. (Vivera) was developing a medical test kit, but had received “negative publicity” from its litigation with a rival company. Vivera hired Sitrick Group, LLC (Sitrick) to manage a public relations campaign. Vivera did not make any payments and Sitrick filed demands for arbitration with Judicial Arbitration and Mediation Services (JAMS). Judge Swart was selected to serve as an arbitrator in a separate matter between Sitrick and Legacy Development (the Legacy matter). In that matter, Sitrick was employing the same law firm (but a different lawyer) as was representing it in the arbitration with Vivera. Sitrick filed petitions to confirm the arbitration award. Vivera asked the trial court to vacate the arbitrator’s award due to Judge Swart’s inadequate disclosure of the Legacy matter. The trial court issued an order confirming the arbitrator’s award.   The Second Appellate District affirmed. The court explained that the California Arbitration Act (the Act) requires arbitrators to disclose, among other things, matters that the Ethics Standards for Neutral Arbitrators in Contractual Arbitration (Ethics Standards) dictate must be disclosed. At issue here is whether the Ethics Standards require a retained arbitrator in a noncommercial case to disclose in one matter that he has been subsequently hired in a second matter by the same party and the same law firm. The court held “no,” at least where the arbitrator has previously informed the parties—without any objection thereto—that no disclosure will be forthcoming in this scenario. Because the arbitrator’s disclosures were proper here, the trial court properly overruled an objection based on inadequate disclosure. View "Sitrick Group v. Vivera Pharmaceuticals" on Justia Law

Appellants Brett and Jenny Terrell appealed a district court’s decision to grant Respondent Paradis de Golf Holding, LLC attorney fees under Idaho Code section 12-120(3). In February 2020, the “Terrells”) sued Paradis for an alleged violation of a recreational easement. In early 2004, Prairie Golf, LLC conveyed to BRMC, LLC a “perpetual, nonexclusive ‘recreational easement’ upon, over, through and across [Prairie Golf’s] property[.]” The easement was appurtenant to and ran with BRMC’s property, which was to be subdivided into 52 single-family residential lots (“the Grayling Estates subdivision”). The easement instrument stated that “each purchaser/owner of a Lot shall be entitled to the benefit of this easement,” which included the ability to play golf for free at a nearby golf course owned at the time by Prairie Golf. In early 2006, the Terrells purchased a home in the Grayling Estates subdivision, which benefitted from the recreational easement. In April 2014, Paradis acquired the golf course subject to the recreational easement. In 2019, Paradis began developing property within the golf course boundary area, which included converting a par five hole to a par three hole and removing a driving range. Paradis then developed residential lots on the excess property where the driving range and part of the par five golf hole used to be. Believing that these developments infringed upon their easement rights, the Terrells sued Paradis. The parties proceeded to arbitration for resolution of their dispute. The arbitrator rendered a decision in Paradis’ favor, finding that none of Paradis’ alterations to the golf course infringed upon the Terrells’ easement rights. Following the arbitration proceedings, Paradis moved for attorney fees under Idaho Code section 12-120(3). The Idaho Supreme Court found the district court erred in concluding that an award of fees was appropriate under section 12-120(3): "Our caselaw is clear that transactions for personal or household purposes do not constitute a commercial transaction for purposes of section 12-120(3)." View "Terrell v. Paradis de Golf Holding, LLC" on Justia Law