Justia Arbitration & Mediation Opinion Summaries

The Supreme Court affirmed the judgment of the district court confirming an arbitrator's award, holding that the court properly affirmed the award.Plaintiff brought this action against Defendant seeking rescission of a contract of purchase and sale of dental practice and lease, alleging that fraudulent misrepresentations were made and that he relied upon them to his detriment. Because the contract contained an arbitration provision the district court sustained Defendant's motion to compel arbitration. The arbitrator concluded that Plaintiff ratified the contract through his conduct and waived any cause of action he might have had arising from his purchase of the dental practice. Plaintiff filed an application to vacate the arbitrator's award. The district court denied the motion. Thereafter, Defendant filed a motion to confirm the award, which the district court granted. The Supreme Court affirmed, holding (1) this Court had jurisdiction to consider Plaintiff's challenge to the denial of his application to vacate, but his challenge lacked merit; and (2) the district court did not err in confirming the arbitration award. View "Cinatl v. Prososki" on Justia Law

A federal whistleblower statute, 41 U.S.C. 4712, does not render unenforceable an arbitration agreement between plaintiff and his former employer, Intratek. The Fifth Circuit held that the district court correctly enforced the arbitration agreement between plaintiff and Intratek. However, the court held that the district court erred in compelling arbitration of claims not covered by that agreement. Finally, the court held that the district court did not abuse its discretion by denying plaintiff's motion to amend the complaint. Therefore, the court affirmed in part, reversed in part, and remanded for further proceedings. View "Robertson v. Intratek Computer, Inc." on Justia Law

Jenny Craig, Inc. hired Marilyn Flanzman to work as a weight maintenance counselor in 1991. In May 2011, Flanzman signed a document entitled “Arbitration Agreement” in connection with her employment. In February 2017, when the dispute that led to this appeal arose, Flanzman was eighty-two years old. Flanzman’s managers informed her that her hours would be reduced from thirty-five to nineteen hours per week. In April 2017, Flanzman’s managers further reduced her hours to approximately thirteen hours per week. In June 2017, they reduced her hours to three hours per week, at which point she left her employment. Flanzman brought suit, asserting claims for age discrimination, constructive discharge, discriminatory discharge, and harassment. Relying on the Agreement, defendants moved to dismiss the complaint and to compel arbitration. Defendants contended that California law governed the Agreement and that the Agreement was enforceable. The trial court granted the motion to dismiss and ordered the parties to arbitrate Flanzman’s claims. It held that California law governed the arbitration and that the proper forum was assumed to be California. Finding no reversible error, the New Jersey Supreme Court affirmed the trial court's judgment. View "Flanzman v. Jenny Craig, Inc." on Justia Law

In a dispute concerning a construction company’s liability for contributions to the Benefits Fund, the Fund unilaterally scheduled arbitration. The company sought to enjoin arbitration, alleging fraud in the execution of the agreement it signed. The district court concluded that the court had the primary power to decide whether fraud in the execution vitiated the formation or existence of the contract containing the arbitration provision. The court enjoined arbitration pending resolution of factual issues that bear upon that claim.The Third Circuit affirmed. Under the Federal Arbitration Act (FAA), 9 U.S.C. 4, questions about the “making of the agreement to arbitrate” are for the courts to decide unless the parties have clearly and unmistakably referred those issues to arbitration in a written contract whose formation is not in issue. Here, the formation of the contract containing the relevant arbitration provision is at issue. View "MZM Construction Co. Inc. v. NJ Building Laborers Statewide BenefitsFunds" on Justia Law

Innovative Images, LLC sued its former attorney James Summerville, Summerville Moore, P.C., and The Summerville Firm, LLC (collectively, the “Summerville Defendants”) for legal malpractice. In response, the Summerville Defendants moved to dismiss the suit and to compel arbitration in accordance with the parties’ engagement agreement, which included a clause mandating arbitration for any dispute arising under the agreement. The trial court denied the motion, ruling that the arbitration clause was “unconscionable” and thus unenforceable because it had been entered into in violation of Rule 1.4 (b) of the Georgia Rules of Professional Conduct (“GRPC”) for attorneys found in Georgia Bar Rule 4-102 (d). The Court of Appeals reversed, holding that the arbitration clause was not void as against public policy or unconscionable. The Georgia Supreme Court concluded after review that regardless of whether the Summerville Defendants violated GRPC Rule 1.4 (b) by entering into the mandatory arbitration clause in the engagement agreement without first apprising Innovative of the advantages and disadvantages of arbitration, the clause was not void as against public policy because Innovative did not argue, and no court has held, that such an arbitration clause could never lawfully be included in an attorney-client contract. For similar reasons, the Supreme Court held the arbitration clause was not substantively unconscionable, and on the limited record before it, Innovative did not show the clause was procedurally unconscionable. Accordingly, the Court affirmed the appellate court's judgment. View "Innovative Images, LLC v. Summerville et al." on Justia Law

The lawsuit underlying this appeal involves a "spin-off" of the Fast & Furious franchise, a project ultimately released as Fast & Furious Presents: Hobbs & Shaw (the film), on which Moritz allegedly worked as a producer pursuant to an oral agreement with Universal. After Moritz filed suit for breach of a binding oral agreement regarding Moritz's work on the film, appellants moved to compel arbitration based on arbitration agreements in the written producer contracts regarding Moritz's work for Universal on the Fast & Furious franchise.The Court of Appeal affirmed the trial court's denial of appellants' motion to arbitrate, holding that the arbitration agreements from the Fast & Furious movies did not apply to the Hobbs & Shaw spin-off dispute. The court stated that not only is it not clear and unmistakable here that the parties agreed to delegate arbitrability questions concerning Hobbs & Shaw to an arbitrator, no reasonable person in their position would have understood the arbitration provisions in the Fast & Furious contracts to require arbitration of any future claim of whatever nature or type, no matter how unrelated to the agreements nor how distant in the future the claim arose. The court explained that the Federal Arbitration Act (FAA) requires no enforcement of an arbitration provision with respect to disputes unrelated to the contract in which the provision appears. In this case, appellants' argument that an arbitration provision creates a perpetual obligation to arbitrate any conceivable claim that Moritz might ever have against them is plainly inconsistent with the FAA's explicit relatedness requirement. View "Moritz v. Universal City Studios LLC" on Justia Law

The First Circuit reversed the judgment of the district court vacating a portion of an arbitration award that voided the guaranty agreement at issue in this case, holding that, contrary to the conclusion of the district court, the arbitrator acted within the scope of his powers.Massachusetts Technology Collaborative (MTC) contracted with KCST USA, Inc. to operate and market a fiber optic network in western Massachusetts. MTC also secured a guaranty of KCST's obligations under the contract from KCST's parent company, Axia NetMedia Corporation. Axia later sued MTC over the guaranty agreement. MTC sought an order compelling arbitration, which the district court granted. The arbitrator found that MTC had materially breached the agreement with KCST, and, therefore, that the guaranty agreement was void for failure of consideration. The district court concluded that the arbitrator had exceeded the scope of his powers and vacated the award. The First Circuit reversed, holding that the arbitrator did not exceed the scope of his powers under section 10(a)(4) of the Federal Arbitration Act. View "Axia NetMedia Corp. v. Massachusetts Technology Park Corp." on Justia Law

After Buyers purchased two care facilities from Sellers, Buyers filed suit alleging that Sellers made fraudulent or, at best, negligent misrepresentations in the parties' sale agreements. Buyers also brought claims against Sellers' representatives in their individual capacities.The Fifth Circuit affirmed the district court's dismissal of Buyers' claims with prejudice for failure to state a claim. The court held that the district court properly dismissed Buyers' non-fraud claims for negligent misrepresentation and breach of contractual representations and warranties because these claims were subject to arbitration. In regard to the remaining claims, the court held that Buyers have not adequately pleaded a misrepresentation with respect to both facilities and thus they failed to meet the particularity requirements of Federal Rule of Civil Procedure 9(b). Therefore, because there was no misrepresentation, there was no fraud. View "Colonial Oaks Assisted Living Lafayette, LLC v. Hannie Development, Inc." on Justia Law

In this action brought against a long-term care facility by Kenneth, as administrator of Estate of Tommy Patton, the Supreme Court reversed in part the court of appeals' decision concluding that an arbitration agreement was enforceable as to Kenneth's individual wrongful death claim but that the agreement was not enforceable as to the Estate's claims, holding that the agreement was valid as to both claims.Kenneth signed an arbitration agreement at the time his father, Tommy, was admitted to Signature HealthCARE of East Louisville's long-term care facility. Tommy later suffered a fall and died a few weeks later. Kenneth brought sued Signature, alleging negligence and wrongful death. Signature filed a motion to compel arbitration. The trial court denied the motion in its entirety. The court of appeals reversed in part, concluding that the arbitration agreement was not enforceable against the Estate but that Kenneth's wrongful death claim was arbitrable because he executed the arbitration agreement in his individual capacity. The Supreme Court reversed in part, holding that both the Estate's and Kenneth's individual claims were subject to arbitration because the arbitration agreement was valid and enforceable as to the Estate claim and as to Kenneth's individual wrongful death claim. View "LP Louisville East, LLC v. Patton" on Justia Law

Since 1986, the GSW NBA basketball team has played their home games at the Authority's Oakland arena. A 1996 License Agreement gave GSW certain obligations to pay the debt incurred in renovating the arena if GSW “terminates” the agreement. In 2012, GSW announced its intention to construct a new arena in San Francisco. GSW did not exercise the renewal option in the Agreement, and, on June 30, 2017, its initial term expired. GSW initiated arbitration proceedings, seeking a declaration that it was no longer obliged to make debt payments if it allowed the License Agreement to expire rather than terminating it.The arbitrator ruled in favor of the Authority and against GSW, awarding the Authority attorney fees. The court of appeal affirmed. Based on extrinsic evidence, the arbitrator found the parties intended to adhere to the terms of a pre-agreement Memorandum of Understanding, which required the team to continue making debt payments after the initial term. The 1996 License Agreement is reasonably susceptible to the parties’ competing interpretations, so parol evidence was admissible to prove what the parties intended. Even assuming that the arbitrator addressed a question of law when she interpreted the Agreement, the parties intended to include a termination of the agreement upon GSW’s failure to exercise the first two options to renew. View "Oakland-Alameda County Coliseum Authority v. Golden State Warriors, LLC" on Justia Law