Justia Arbitration & Mediation Opinion Summaries

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

Pfizer’s Human Resources Department sent an e-mail to Pfizer employees at their corporate e-mail addresses announcing Pfizer’s five-page Mutual Arbitration and Class Waiver Agreement (Agreement) and included a link to that document. The e-mail also included a included a link to a document that listed “Frequently Asked Questions,” including “Do I have to agree to this?” to which the response indicated, “The Arbitration Agreement is a condition of continued employment with the Company. If you begin or continue working for the Company sixty (60) days after receipt of this Agreement, it will be a contractual agreement that binds both you and the Company.” The “FAQs” document also encouraged any employee who had “legal questions” about the Agreement “to speak to [his or her] own attorney.” Pfize terminated Amy Skuse's employment in August 2017, and Skuse filed a complaint alleging that Pfizer and the individual defendants violated the Law Against Discrimination by terminating her employment because of her religious objection to being vaccinated for yellow fever. Defendants moved to dismiss the complaint and to compel arbitration. Skuse opposed the motion, contending that she was not bound by Pfizer’s Agreement, arguing that she was asked only to acknowledge the Agreement, not to assent to it, and that she never agreed to arbitrate her claims. The trial court dismissed Skuse’s complaint and directed her to proceed to arbitration in accordance with the Agreement. The Appellate Division reversed, identifying three aspects of Pfizer’s communications to Skuse as grounds for its decision: Pfizer’s use of e-mails to disseminate the Agreement to employees already inundated with e-mails; its use of a “training module” or a training “activity” to explain the Agreement; and its instruction that Skuse click her computer screen to “acknowledge” her obligation to assent to the Agreement in the event that she remained employed for sixty days, not to “agree” to the Agreement. The New Jersey Supreme Court reversed, finding the Agreement was valid and binding, and held the trial court was correct in enforcing it. View "Skuse v. Pfizer, 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

The Ninth Circuit reversed the district court's order on a motion to compel arbitration of a grievance in which the union asserted that the Hospital placed certain types of patients with nurses who did not have the appropriate training for those patients and that the Hospital was violating nurse-to-patient ratios established by state law. At issue in this appeal is whether the arbitrability of an issue is itself arbitrable, where the relevant agreement includes a broad arbitration clause but is otherwise silent on the question.In First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938 (1995), the Supreme Court established that a court, not the arbitrator, must make the determination whether the arbitrability of an issue is itself arbitrable when the relevant agreement is silent on that question. In United Bhd. Of Carpenters & Joiners of Am., Local No. 1780 v. Desert Palace, Inc., 94 F.3d 1308 (9th Cir. 1996), this court stated that labor cases are different, and in those cases, an arbitrator should decide arbitrability as long as the agreement includes a broad arbitration clause.The panel held that the rationale in Desert Palace is clearly irreconcilable with the reasoning or theory of intervening higher authority in Granite Rock Co. v. Int'l Bhd. of Teamsters, 561 U.S. 287, 300–01 (2010), where the Supreme Court expressly rejected the notion that labor arbitration disputes should be analyzed differently than commercial arbitration disputes. Therefore, the panel was not bound by Desert Palace and remanded to the district court to consider whether the union's grievance is arbitrable. View "SEIU Local 121RN v. Los Robles Regional Medical Center" on Justia Law

After plaintiff won a substantial arbitration award against his former employer, the employer sought vacatur in federal court. The district court agreed with the employer, Citi, that plaintiff had been an at-will employee and thus the arbitrators exceeded their powers by finding that he had been wrongfully terminated.The Eleventh Circuit reversed the district court's vacatur of the arbitration award, holding that plaintiff and Citi agreed to arbitrate all disputes about plaintiff's employment. The court stated that, under the Federal Arbitration Act, the merits of plaintiff's dispute were committed to the arbitrators and Citi does not get to start over in federal court because it identifies a possible legal error in arbitration. Therefore, the district court erred by substituting its own legal judgment for that of the arbitrators. View "Gherardi v. Citigroup Global Markets, Inc." on Justia Law

Plaintiff-appellant Dana Fedor appealed a district court’s order compelling her to arbitrate employment-related claims she brought against her former employer, UnitedHealthcare, Inc. (UHC), and United Healthcare Services, Inc. Fedor argued the district court impermissibly compelled arbitration before first finding that she and UHC had indeed formed the arbitration agreement underlying the district court’s decision. To this, the Tenth Circuit agreed, concluding that the issue of whether an arbitration agreement was formed in the first instance had to be determined by the court, even where there has been a failure to specifically challenge provisions within the agreement delegating certain decisions to an arbitrator. Judgment was vacated and the matter remanded for further proceedings. View "Fedor v. United Healthcare" on Justia Law

Evette Burgess and Lithia Motors, Inc. entered into arbitration to resolve an employment dispute. During arbitration proceedings, Burgess filed a motion with the court to terminate arbitration, alleging that Lithia and the arbitrator breached the arbitration agreement. The superior court denied Burgess’s motion, citing a lack of jurisdiction, and certified the matter for direct review, which the Washington Supreme Court granted. Under the FAA, the Supreme Court determined judicial review was limited to deciding gateway disputes, which concern enforceability of the arbitration clause, and addressing the award after arbitration. Therefore, the Supreme Court affirmed the superior court. View "Burgess v. Lithia Motors, Inc." on Justia Law

The Court of Appeal reversed the trial court's order denying the employer's motion to compel arbitration. The court held that the employee demonstrated his assent to the arbitration clause by signing the acknowledgment, and the employer had no duty to call the arbitration agreement to the employee's attention. The court found that provisions in the arbitration clause concerning arbitrator's fees and costs and attorney fees are unenforceable, but they may be severed, and the rest of the agreement is enforceable. Accordingly, on remand, the trial court is directed to sever the offending provisions concerning arbitration fees and costs and attorney fees from the agreement and otherwise grant the motion to compel arbitration. View "Conyer v. Hula Media Services, LLC" on Justia Law

Pagliacci Pizza hired Steven Burnett as a delivery driver. Steven Burnett attended a mandatory new employee orientation at a local Pagliacci Pizza. During the orientation, Pagliacci gave Burnett multiple forms and told him to sign them so that he could start working. One of the forms that Burnett signed was a one-page “Employee Relationship Agreement” (ERA). The ERA mentioned nothing about arbitration of disputes. Pagliacci’s “Mandatory Arbitration Policy” (MAP) was printed in Pagliacci’s employee handbook, “Little Book of Answers,” a 23-page booklet in which Pagliacci’s MAP appeared on page 18. The MAP was not listed in the handbook’s table of contents, and page 18 fell within the “Mutual Fairness Benefits” section. Burnett was given a copy of Little Book of Answers during his orientation and told to read it at home. Consistent with that instruction, the ERA contained a section entitled “Rules and Policies.” Delivery drivers like Burnett filed a class action alleging wage and hour claims against Pagliacci Pizza. At issue on interlocutory review was whether the trial court sustainably denied the employer’s motion to compel arbitration. The Court of Appeals affirmed, determining that the mandatory arbitration policy contained in the employee handbook, which was provided to the named plaintiff after he signed the employment relationship agreement, was procedurally and substantively unconscionable and, thus, unenforceable. The Washington Supreme Court held that the MAP at issue in this case was indeed unenforceable because no arbitration agreement was formed when the employee signed the employment agreement when he had no notice of the arbitration provision contained in the employee handbook. The Court also held that in light of the noted circumstances, even if an arbitration contract existed, it was procedurally unconscionable and unenforceable. Furthermore, the Court held the same arbitration provision was substantively unconscionable because its one-sided terms and limitation provisions would bar any claim by the terminated employee here, an overly harsh result. Accordingly, the trial court’s order denying the employer’s motion to compel arbitration was affirmed and the matter remanded for further proceedings. View "Burnett v. Pagliacci Pizza, Inc." on Justia Law

Davis filed sued individual Red Bull executives for age and sexual harassment and hostile work environment in violation of the Fair Employment and Housing Act, and for intentional and negligent infliction of emotional distress. Davis was 56 years old, had been employed by Red Bull for 15 years, and was in a mid-level managerial sales position until he was terminated.Red Bull filed a demand for arbitration with the American Arbitration Association. The individual defendants moved to compel Davis to submit his claims to arbitration. Davis filed a separate lawsuit against Red Bull seeking a declaratory judgment that his claims were not subject to the arbitration agreement. That agreement specifies it is “intended to cover all civil claims which involve or relate in any way to [Davis’s] employment (or termination of employment) with Red Bull, including, but not limited to, claims of employment discrimination or harassment on the basis of . . . sex, age, . . . claims for wrongful discharge, [and] claims for emotional distress.”The trial court concluded and the court of appeal affirmed that the agreement was unconscionable and unenforceable. The court noted the "adhesion" nature of the agreement, which is not mutual and the arbitral discovery process does not guarantee adequate discovery. View "Davis v. Kozak" on Justia Law