Justia Arbitration & Mediation Opinion Summaries

These appeals arose out of LJL's exercise of its contractual option to purchase Pitcairn's ownership stake in a jointly owned high-rise luxury residential building in New York City, after which the parties pursued an arbitration to determine the value of the property. Both parties subsequently appealed from the district court's judgment. In LJL's appeal, the court agreed with its contention that the arbitrator's exclusion of Pitcairn's hearsay exhibits was within the arbitrator's authorized discretion and, therefore, vacated the district court's order overturning the arbitrator's determination of the Stated Value. The court agreed with the district court's conclusion that the arbitrator acted in accordance with the terms of the arbitration agreement in refusing to determine the Purchase Price and, therefore, remanded with instructions to confirm the arbitration award in its entirety. In Pitcairn's appeal, the court found no error in the district court's dismissal of Pitcairn's claims for breach of fiduciary duties and breach of the covenant of good faith and fair dealing. Accordingly, the court affirmed the judgment. View "LJL 33rd Street Associates, LLC v. Pitcairn Properties Inc." on Justia Law

The parties in this case agreed to a compromise to settle an ongoing dispute regarding the ownership of a company while they were actively litigating the issue. The general terms of the compromise were jotted down on a piece of lined writing paper, then submitted to the court with the understanding that a formal typewritten agreement would follow. When a dispute arose as to a provision in the subsequent formal version, the issue was submitted to an arbitrator. The arbitrator found the initial, handwritten agreement, which did not contain a disputed third-party consent clause, to be binding and enforceable. The issue before the Supreme Court was whether the arbitrator’s decision should have been vacated due to his refusal to consider parol evidence of the condition precedent. Finding no statutory grounds to disturb the arbitrator’s decision, the Supreme Court affirmed the trial court and the arbitrator. View "Robinson v. Henne" on Justia Law

This case arose from territory-related disputes between two franchisees, Paul Davis Restoration of S.E. Wisconsin, Inc. (Southeast) and Paul Davis Restoration of Northeast Wisconsin (Northeast). The results of an arbitration process included an award for Southeast against Northeast, which is the name under which EA Green Bay, LLC (Green Bay) did business. Green Bay opposed the subsequent garnishment action on the grounds that the judgment, entered against Northeast only, was unenforceable. The circuit court held that any valid judgment against Northeast was also enforceable against Green Bay. The court of appeals reversed. The Supreme Court reversed, holding (1) if the name under which a person or corporation does business is simply another way to refer to a single legal entity and constitutes no entity distinct from the person or corporation who does business, then a judgment against the "doing business as" or "d/b/a" name is enforceable against the legal entity from which it is indistinct; and (2) therefore, the judgment against Green Bay's d/b/a designation, Northeast, was enforceable against Green Bay. View "Paul Davis Restoration of Se. Wis., Inc. v. Paul Davis Restoration of Ne. Wis." on Justia Law

The Whites were dealers of Kinkade’s artwork. The parties agreed to arbitrate disputes in accordance with the Commercial Arbitration Rules of the American Arbitration Association. In 2002, they commenced arbitration in which Kinkade claimed that the Whites had not paid hundreds of thousands of dollars, and the Whites counterclaimed that they had been fraudulently induced to enter the agreements. Kinkade chose Ansell as its arbitrator; the Whites chose Morganroth. Together Ansell and Morganroth chose Kowalsky as the neutral who would chair the panel. The arbitration dragged on; in 2006, Kinkade discovered that the Whites’ counsel, Ejbeh, had surreptitiously sent a live feed of the hearing to a hotel room. Ejbeh’s replacement departed after being convicted of tax fraud. The Whites did not comply with discovery requests, but after closing arguments and over objections, the panel requested that the Whites supply additional briefs. The Whites and their associates then began showering Kowalsky’s law firm with business. Kinkade objected, to no avail. A series of arbitration irregularities followed, all favoring the Whites. Kowalsky entered a $1.4 million award in the Whites’ favor. The district court vacated the award on grounds of Kowalsky’s “evident partiality.” The Sixth Circuit affirmed. View "Thomas Kinkade Co. v. White" on Justia Law

Plaintiffs Joe F. Watkins, Patricia M. Smith, and RE/MAX Lake Martin Properties, LLC sued Bear Brothers, Inc., ETC Lake Development, LLC ("ETC Lake"), and E.T. "Bud" Chambers, among others, asserting claims related to the construction and development of a condominium project on Lake Martin. ETC Lake and Chambers crossclaimed against Bear Brothers seeking to recover losses suffered on the project as well as indemnification for the costs of litigating the plaintiffs' action and any damages for which they might be found liable to the plaintiffs. In January 2010, Bear Brothers moved the circuit court to compel arbitration of the cross-claim against it. The circuit court did not rule on that motion. Bear Brothers renewed its motion in July 2011, and the circuit court granted the motion to compel arbitration of the cross-claim in December. Bear Brothers then moved the circuit court "to stay [the] proceedings [in the plaintiffs' action] pending the outcome of a related arbitration." After a hearing, the circuit court denied the motion to stay. Bear Brothers appealed the circuit court's order denying the motion to stay to the Supreme Court; ETC Lake and Chambers moved to dismiss the appeal. Upon review, the Supreme Court concluded that the motion at issue in this case was a motion to stay related proceedings pending the arbitration of a crossclaim between codefendants and was filed separately from the initial motion to compel arbitration of the cross-claim and subsequent to the circuit court's order granting the motion. Thus, Bear Brothers did not demonstrate a right to appeal the denial of the motion to stay at this time, and accordingly the Court dismissed the appeal as being from a nonfinal judgment. View "Bear Brothers, Inc. v. ETC Lake Development, LLC" on Justia Law

H. Gordon Myrick, Inc. (Myrick) contracted with Harrison County Commercial Lot (HCCL) to build HCCL an executive office building. The parties' contract contained an arbitration provision, which excluded aesthetic-effect claims from arbitration. The issue before the Supreme Court in this case concerned which, if any, of the parties' claims were subject to arbitration. The trial court determined that the arbitration agreement was valid and ordered arbitration on designated, nonaesthetic claims. HCCL appealed and Myrick cross-appealed. Upon review, the Supreme Court found that the parties' claims were without merit, "but it is difficult to determine why the trial court ordered certain punch-list items to arbitration and others not. Thus, [the Court] remand[ed the case] to the trial court to provide further explanation on the punch-list items alone." View "Harrison County Commercial Lot, LLC v. H. Gordon Myrick, Inc." on Justia Law

This appeal involved litigation between Coverall North America, Inc. and its franchisees. Proceeding under federal diversity jurisdiction, the franchisees asserted a variety of state-law claims against Coverall. Which of the various plaintiffs were subject to the arbitration provisions of the Franchise Agreement was at issue in this appeal. Appellees were a subgroup of Plaintiffs who became Coverall franchisees by signing consent to transfer agreements, which by reference incorporated under franchise agreements that contained arbitration clauses. The district court determined that Appellees did not have to arbitrate their claims against Coverall because they did not have adequate notice of the arbitration clauses contained in the franchise agreements. The First Circuit Court of Appeals reversed, holding that the district court erred because (1) Massachusetts law, which governed this dispute, did not impose any such special notice requirement upon these commercial contractual provisions; and (2) in any event, any special notice requirement would be preempted by the Federal Arbitration Act. View "Awuah v. Coverall N.A., Inc. " on Justia Law

This interlocutory appeal stemmed from litigation concerning a contract dispute among Williams Transport, LLC (Williams Transport), Driver Pipeline Company, Inc. (Driver Pipeline), Buckley Equipment Services, Inc. (Buckley Equipment), and other unnamed defendants. Based on an arbitration clause in the contract, Driver Pipeline filed a motion to compel arbitration. The trial court denied the motion to compel arbitration as well as a subsequent motion for reconsideration. Driver Pipeline filed a petition for interlocutory appeal, which the Supreme Court accepted as a notice of appeal. Finding no error by the trial court in denying Driver Pipeline's motion to compel arbitration, the Supreme Court affirmed. View "Driver Pipeline Company, Inc., Buckley Equipment Services, Inc. v. Williams Transport, LLC" on Justia Law

Plaintiffs filed suit seeking a judicial resolution of an LLC in which both Plaintiffs and Defendants held ownership interests. The district court ordered judicial dissolution and appointment of a receiver after finding that the managing member of the LLC, one of the defendants, had never operated the LLC in conformity with the operating agreement and had acted in a manner that was unduly prejudicial to Plaintiffs. The Supreme Court affirmed, holding (1) there were substantial undisputed facts to support the district court's order for dissolution under Mont. Code Ann. 35-8-902(1), and the district court properly applied the statute; and (2) the district court properly denied Defendants' motion to amend their answer to add counterclaims because Defendants were required to arbitrate such claims under the operating agreement. View "Gordon v. Kuzara" on Justia Law

Avaya Inc. ("Avaya") appealed a district court's ruling compelling arbitration of its labor dispute with the Communication Workers of America ("CWA") over the legal status of a class of Avaya employees called "backbone engineers." The union viewed the backbone engineers as non-represented "occupational" employees and legitimate objects for its organizing campaigns, while Avaya saw them as managers outside the scope of the company's labor agreements. CWA contended the parties' collective bargaining agreement ("CBA") required any dispute over the status of backbone engineers to be resolved in arbitration. Avaya maintained the parties did not consent to arbitrate the status of its backbone engineers and accused CWA of trying to unilaterally enlarge the CBA to encompass disputes over company management. Having reviewed the CBA and the evidence submitted to the district court, the Tenth Circuit agreed with Avaya's position and reversed the district court's order compelling arbitration. View "CWA v. Avaya, Inc." on Justia Law