Justia Arbitration & Mediation Opinion Summaries

Johnson served as an Air Traffic Controller Watch Supervisor. The Air Force alleged that Johnson was at fault for a violation of FAA policy concerning the separation of aircraft during his watch in 2018 and that this was grounds for removal in light of his prior offenses. A notice of a removal decision was effective May 11, 2019. On May 7, 2019, the local Union initiated grievance procedures. When the dispute was not resolved, the Union invoked arbitration through the Federal Mediation and Conciliation Service. In November 2020, the Arbitrator upheld the removal decision.The Union appealed but withdrew from the appeal because its national union had placed the local Union in receivership and stripped its counsel of all authority to proceed. Without reaching the merits, the Federal Circuit dismissed Johnson’s motion (Federal Rule 43(b) of Appellate Procedure), to substitute the Union. A party may not substitute under Rule 43(b) where the original party to the appeal lacked standing; unions lack standing to initiate an appeal of an arbitration decision under 5 U.S.C. 7703(a). A party may not substitute under Rule 43(b) when the original party being substituted lacked standing to initiate the appeal. View "American Federation of Government Workers v. Department of the Air Force" on Justia Law

Escapes! To the Shores Condominium Association, Inc. ("the Association"), individually and on behalf of certain condominium-unit owners, appealed an order denying a Rule 59, Ala. R. Civ. P. motion to vacate a judgment entered on an arbitration award in favor of Hoar Construction, LLC ("Hoar"), and Architectural Surfaces, Inc. ("ASI"). The arbitration award in favor of Hoar and ASI stemmed from the construction of a condominium building located in Orange Beach known as "Escapes! To the Shores." Hoar was the general contractor for the construction project; Stephen Hill was the architect for the construction project; and ASI was the subcontractor responsible for the installation of the exterior surfaces to the condominium building. After construction of the condominium building was substantially complete, the developer of the project sold the units and transferred ownership and management of the common areas to the Association. The Association thereafter filed suit against Hoar, ASI, and Hill seeking damages arising out of alleged construction and design defects to the condominium building, specifically, "stucco blistering and water intrusion." The Association's claims against Hoar and ASI proceeded to arbitration, but its claims against Hill remained pending in the trial court. A panel of three arbitrators issued a final award in favor of Hoar and ASI, concluding, in relevant part, that the defects to the condominium building were the result of a design defect and not a construction defect. Once the trial court entered a judgment on the arbitration award, the Association thereafter filed a Rule 59 motion to vacate that judgment. The Alabama Supreme Court concluded the Association has failed to demonstrate that the arbitration panel engaged in misconduct that would warrant vacatur. Accordingly, the order denying the Association's Rule 59 motion and the judgment entered on the arbitration award were affirmed. View "Escapes! To the Shores Condominium Association, Inc. v. Hoar Construction, LLC, et al." on Justia Law

The Supreme Court conditionally granted mandamus relief directing the district court to withdraw its order modifying its underlying judgment, holding that the district court's plenary power had expired before it undertook to revise its final judgment, and therefore the order modifying the judgment was void.The parties in this case, which arose from a construction project dispute, resolved their dispute via arbitration. The arbitrator issued a final arbitration award, and the district court entered a judgment confirming the award. More than one year later, one parties moved to modify the judgment to clarify that it was not a "final judgment" but merely interlocutory. The district court modified the judgment to reflect that it was interlocutory but sua sponte certified the question for interlocutory appeal. The Supreme Court held that the judgment rendered was clearly and unequivocally final. View "Patel v. Nations Renovations, LLC" on Justia Law

Plaintiff brought a putative class action against Cash Advance Centers, Inc., alleging a violation of the Telephone Consumer Protection Act, 47 U.S.C. Section 227. Counsel purporting to represent Cash Advance Centers, Inc., moved to compel arbitration based on arbitration provisions contained in loan agreements between Plaintiff and non-party Advance America, Cash Advance Centers of Missouri, Inc. The district court denied the motion to compel. Counsel also moved to substitute Advance America, Cash Advance Centers of Missouri, Inc., for Cash Advance Centers, Inc., as the party defendant, but the district court denied that motion as well.
The Eighth Circuit affirmed. The court explained only parties to a lawsuit may appeal an adverse judgment. Because Advance America, Cash Advance Centers of Missouri, Inc., is not a party to the lawsuit, its notice of appeal is insufficient to confer jurisdiction on the Court. The non-party Advance America, Cash Advance Centers of Missouri, Inc., made no appearance in connection with the motion, and the court’s order addressed only a motion advanced by the party Defendant. The notice of appeal also names Cash Advance Centers, Inc., the party Defendant, as an appellant. But while attorneys purporting to represent Cash Advance Centers, Inc., filed a notice of appeal, counsel acknowledged at oral argument that she represented only non-party Advance America, Cash Advance Centers of Missouri, Inc., and not Cash Advance Centers, Inc. View "Kamisha Stanton v. Cash Advance Centers, Inc" on Justia Law

Tribal lending entities (TLEs) retained the LLCs to manage their online lending programs. In 2017, the relationships began to deteriorate. The LLCs and their managing members, the Koettings, allegedly persuaded customers to continue borrowing from new lenders controlled by the Koettings. The TLEs terminated the agreements and claimed breach of contractual and fiduciary duties, fraud, theft, failure to safeguard customer data, and failure to transfer revenue owed. The LLCs also accused the TLEs of breaching the agreements. An arbitrator ruled against the LLCs and the Koettings.The court of appeal reversed in part because the TLEs failed to demonstrate that the Koettings clearly consented to the arbitrator’s determination of whether they as nonsignatories were bound by the arbitration agreement in the contracts between the TLEs and the LLCs. JPV (successor to the TLEs) unsuccessfully moved to amend the judgment to add the Koettings as judgment debtors on an alter ego theory.JPV argued the trial court abused its discretion by disregarding the collateral estoppel effect of the arbitrator’s findings underlying the judgment against the LLCs and failing to consider all circumstances relevant to the alter ego inquiry, including the arbitral findings that the LLCs wrongfully diverted the TLEs’ customers and business opportunities to other entities controlled by the Koettings. The court of appeal vacated. The trial court made erroneous legal assumptions and misunderstood the proper scope of its discretion. View "JPV I L.P. v. Koetting" on Justia Law

Casandra Murrey, a single, 46-year-old female, worked for General Electric Company (GE) as a product sales specialist for ultrasound equipment. The complaint alleged GE hired Murrey in early 2018 and she was a “top performer.” In 2019, GE hired Joseph Gorczyca, III. In January 2020, he became Murrey’s direct supervisor, and he engaged in continuous sexual harassment in the workplace with Murrey and others. She alleged GE “never properly completed an immediate [n]or appropriate investigation or took any . . . corrective action. Instead, [GE] later informed [her] that Gorczyca was ‘no longer with the company.’” Thereafter, GE “commenced an illegal pattern of retaliatory behavior against Murrey because [she] engage[ed] in protective activity” that included “denying appropriate support for [her] sales position” and refusing to promote her. Eight months after Murrey filed the complaint, GE moved to compel arbitration. GE sent all new hires a “welcome e-mail” to the new hire’s personal e-mail address that contained a link to GE’s electronic onboarding system/portal. Each document was assigned a separate task and the new hire signed employment-related agreements using his or her electronic signature. Based on this process and GE’s other security measures, GE’s lead HR specialist Michelle Thayer concluded Murrey’s electronic signature on an Acknowledgment was made by Murrey that Murrey assented to an included arbitration in the onboarding materials. The trial court granted the motion to compel arbitration, concluding:(1) GE met its burden of showing the arbitration agreement covered Murrey’s claims; (2) all of Murrey’s causes of action arose out of or were connected with her employment; and (3) Murrey met her burden showing procedural unconscionability because it was a contract of adhesion; but (5) Murrey failed to show a sufficient degree of substantive unconscionability to render the agreement unenforceable. The Court of Appeal reversed, finding the arbitration agreement in this case contained a high degree of procedural unconscionability. "When we consider the procedural and substantively unconscionable provisions together, they indicate a concerted effort to impose on an employee a forum with distinct advantages for the employer." The Court issued a writ of mandate on the trial court to vacate the order compelling arbitration, and to enter a new order denying the motion. View "Murrey v. Superior Court" on Justia Law

Plaintiff and appellant, a contractor, prevailed in an arbitration against its client, the Defendant and Respondent. After finding that Plaintiff was not duly licensed because its responsible managing employee (RME) did not meet the criteria required by law, the trial court granted Defendant's petition to vacate the arbitration award on the ground that the arbitrator exceeded her powers.Plaintiff made two main arguments on appeal. It first contends the trial court misapplied the burden of proof regarding whether Plaintiff was a duly licensed contractor. The Second Appellate District rejected this argument, finding that the trial court correctly determined that Plaintiff had the burden of proof on this issue.Plaintiff also argued the trial court erroneously denied it an evidentiary hearing. In the trial court, however, Plaintiff did not seek an evidentiary hearing. It instead argued that such a hearing was not authorized by law. Therefore, the Second Appellate District held that Plaintiff forfeited the issue on appeal. View "Vascos Excavation Group LLC v. Gold" on Justia Law

Employer Howard Center appealed a trial court order that confirmed an arbitration award in favor of grievant Daniel Peyser and AFSCME Local 1674. In May 2019, employer expressed concern over grievant’s billing practices, specifically, his submission of billing paperwork in May for services provided in April. Employer told grievant that it was considering disciplining him for “dishonesty and unethical action” concerning the backdated bills. Grievant brought two billing notes from patient records to show that other employees engaged in the same billing practices. Employer did not reprimand grievant for the billing practices. In August 2019, however, employer informed grievant that he breached employer’s confidentiality policy by sharing the billing notes with his union representative at the June meeting. Employer issued a written reprimand to grievant. The reprimand stated that sharing client records without redacting confidential information violated protocols and state and federal regulations, and that grievant knew or should have known of these standards. Employer also explained that it was required to report the breach to state and federal authorities and to those individuals whose records were disclosed. Grievant filed a grievance under the terms of his collective-bargaining agreement, arguing in part that employer lacked just cause to discipline him. In an October 2020 decision, the arbitrator sustained the grievance. Employer then filed an action in the civil division seeking to modify or vacate the arbitrator’s award, arguing in relevant part that the arbitrator manifestly disregarded the law in sustaining the grievance. Employer asked the Vermont Supreme Court to adopt “manifest disregard” of the law as a basis for setting aside the arbitration award and to conclude that the arbitrator violated that standard here. The Supreme Court did not decide whether to adopt the manifest-disregard standard because, assuming arguendo it applied, employer failed to show that its requirements were satisfied. The Court therefore affirmed. View "Howard Center v. AFSCME Local 1674, et al." on Justia Law

Smarter Tools Inc. (“STI”) appeals the district court’s judgment denying STI’s petition to vacate an arbitral award and granting Chongqing SENCI Import & Export Trade Co., Ltd.’s and Chongqing AM Pride Power & Machinery Co. Ltd.’s (collectively, “SENCI”) cross-petition to confirm that award. The district court agreed with STI that the arbitrator exceeded his authority by failing to provide a reasoned award as requested by the parties. The district court remanded to allow the arbitrator to issue a reasoned award. On remand, the arbitrator issued a final amended award, which STI again challenged in district court on the grounds that the award was not reasoned and that it reflected a manifest disregard of the law, and which SENCI again cross-petitioned to confirm. The district court denied STI’s petition to vacate the award and granted SENCI’s cross-petition to confirm the award.   STI’s primary argument on appeal is that the district court erred in remanding for the arbitrator to issue a reasoned award, in contravention of the doctrine of functus officio and the Federal Arbitration Act. Absent a finding of ambiguity, or a minor clerical error, STI argues, once the district court determined that the arbitrator exceeded its authority by failing to issue a  reasoned award, the only remedy available was vacatur.   The Second Circuit affirmed. The court explained that the original award was found not to provide the reasoned award the parties bargained for; in its amended award, the arbitrator clarified the original award by including a rationale for rejecting STI’s counterclaims; and this clarification is consistent with the parties’ intent that the arbitrator issue a reasoned award. View "Smarter Tools Inc. v. Chongqing Senci Import & Export Trade Co., Ltd." on Justia Law

A Bolivian arbitration tribunal awarded $36 million in damages to Compania de Inversiones Mercantiles S.A. (“CIMSA”) against Grupo Cementos de Chihuahua S.A.B. de C.V. (“GCC”). GCC fought the award in the Bolivian courts, losing before a chamber of Bolivia’s highest constitutional court in 2016. In 2019, CIMSA obtained an order from the U.S. District Court for the District of Colorado confirming the award. In 2020, GCC convinced a different chamber of Bolivia’s highest constitutional court to invalidate its prior decision, and a Bolivian trial judge subsequently annulled the award. GCC then moved the U.S. district court to vacate the confirmation order. The district court: (1) denied GCC’s motion; and (2) ordered GCC to turn over assets located in Mexico to satisfy the award. GCC brought separate appeals from these two rulings. GCC argued that the district court erred by refusing to vacate the Confirmation Judgment, contending the 2020 Bolivian court orders annulling the Damages Award required vacatur. The Tenth Circuit found when a court has been asked to vacate an order confirming an arbitral award that has later been annulled, it may balance against comity considerations (1) whether the annulment is repugnant to U.S. public policy or (2) whether giving effect to the annulment would undermine U.S. public policy. "Although the district court here may have found the 2020 Bolivian orders were not repugnant, it did not legally err by considering whether giving effect to those orders through vacatur of its Confirmation Judgment would offend U.S. public policy." Because the district court did not abuse its discretion by refusing to vacate its Confirmation Judgment, the Tenth Circuit affirmed. View "Compania De Inversiones v. Grupo Cementos de Chihuahua, et al." on Justia Law