Justia Arbitration & Mediation Opinion Summaries

Matthew Ray, a former DISH Network L.L.C. employee who signed an arbitration agreement when he was employed, filed an action in the federal district court alleging violations of the Fair Labor Standards Act (“FLSA”), Colorado’s Wage Claim Act, Colorado’s Minimum Wage Act, and a common law claim for breach of contract. Dish moved to dismiss, demanding that Ray arbitrate his claims pursuant to the Agreement. Ray dismissed the lawsuit and filed with the American Arbitration Association (“AAA”), asserting the same four claims. In addition, and the focus of this case, Ray attempted to pursue his claims as a class action under Fed. R. Civ. P. 23 and a collective action under 29 U.S.C. 216(b). The arbitrator determined that the Arbitration Agreement between the two parties permitted classwide arbitration, and then stayed the arbitration to permit DISH to contest the issue in court. DISH filed a Petition to Vacate Clause Construction Arbitration Award, which the district court denied. After review, the Tenth Circuit determined the arbitrator in this case did not manifestly disregard Colorado law when he concluded that he was authorized to conduct class arbitration by the broad language of the Agreement in combination with the requirement that arbitration be conducted pursuant to the AAA’s Employment Dispute Rules. Accordingly, the district court correctly denied DISH’s petition to vacate the arbitration award. View "Dish Network v. Ray" on Justia Law

Gaffers is a former employee of Kelly, which provides outsourcing and consulting services to firms around the world, including “virtual” call center support, where employees like Gaffers work from home. Gaffers alleged that Kelly underpaid virtual employees, based on time spent logging in to Kelly’s network, logging out, and fixing technical problems. Gaffers sued on behalf of himself and his co-workers (over 1,600 have joined) seeking back pay and liquidated damages under the Fair Labor Standards Act (FLSA), 29 U.S.C. 216(b). About half of the employees that Gaffers sought to represent signed an arbitration agreement with Kelly (Gaffers did not sign one) stating that individual arbitration is the “only forum” for employment claims, including unpaid-wage claims. Kelly moved to compel individual arbitration under the Federal Arbitration Act, 9 U.S.C. 4. Gaffers contended that the National Labor Relations Act and the Fair Labor Standards Act rendered the arbitration agreements unenforceable. The district court agreed with Gaffers. The Sixth Circuit reversed. In 2018, the Supreme Court held, in Epic Systems, that the National Labor Relations Act does not invalidate individual arbitration agreements. The court rejected arguments that FLSA displaced the Arbitration Act by providing a right to “concerted activities” or “collective action” or rendered the employees’ arbitration agreements illegal and unenforceable. View "Gaffers v. Kelly Services, Inc." on Justia Law

Acosta challenged the district court's entry of a default judgment against them after they failed to pay their required arbitration fees in a dispute with a former employee who sought unpaid wages under the Fair Labor Standards Act (FLSA). The Eleventh Circuit vacated and remanded, holding that it found no basis in the Federal Arbitration Act, caselaw, or anywhere else to support a court's decision to enter a default judgment solely because a party defaulted in the underlying arbitration. Because the court concluded that the district court erred in entering a default judgment against Acosta based solely on Acosta's default in the underlying arbitration, the court did not reach the remaining arguments. View "Hernandez Hernandez v. Acosta Tractors Inc." on Justia Law

When Goplin began working at WeConnect, he signed the “AEI Alternative Entertainment Inc. Open Door Policy and Arbitration Program,” which referred to AEI throughout; it never mentioned WeConnect. Goplin brought a collective action under the Fair Labor Standards Act. WeConnect moved to compel arbitration, Fed.R.Civ.P. 12(b)(3), attaching an affidavit from its Director of Human Resources stating, “I am employed by WeConnect, Inc.—formerly known as Alternative Entertainment, Inc. or AEI.” Goplin claimed that WeConnect was not a party to the agreement and could not enforce it. He cited language on WeConnect’s website: WeConnect formed when two privately held companies, Alternative Entertainment, Inc. (AEI) and WeConnect Enterprise Solutions, combined in September 2016… we officially became one company. WeConnect asserted that WeConnect and AEI were two names for the same legal entity, stating: This was a name change, not a merger. The court held that WeConnect did not establish that it was a party to the agreement or otherwise entitled to enforce it. The court rejected subsequently-submitted corporate-form documents and affidavits, stating that new evidence cannot be introduced in a motion for reconsideration unless the movant shows “not only that [the] evidence was newly discovered or unknown to it until after the hearing, but also that it could not with reasonable diligence have discovered and produced such evidence.” The Seventh Circuit affirmed. View "Goplin v. WeConnect, Inc." on Justia Law

The Ninth Circuit affirmed the district court's order affirming an arbitration award for the union. ASARCO argued that the award was invalid because the arbitrator reformed the Basic Labor Agreement (BLA) between the union and ASARCO in contravention of a no-add provision in that agreement. The district court affirmed the award, holding that ASARCO properly preserved its objection to the arbitrator's jurisdiction, but the arbitrator was authorized to reform the BLA, despite the no-add provision, based on a finding of mutual mistake. The panel affirmed, holding that the arbitrator was acting within his authority when he crafted a remedy to cure the parties' mutual mistake. Even if ASARCO did not waive its right to contest the arbitrator's jurisdiction, which it did, the panel deferred to the arbitrator's judgment. View "ASARCO, LLC v. United Steel, Paper and Forestry" on Justia Law

Jefferson County v. Jefferson County Constables Ass’n, __ S.W.3d __, __ (Tex. 2018), in which the Supreme Court held that the Fire and Police Employee Relations Act applies to deputy constables because they qualify as “police officers” under the Act’s definition of that term, resolved the issue presented in this case and necessitated reversal of the court of appeals’ judgment.Petitioner was terminated from his employment as a deputy constable in Jefferson County and sued for a declaratory judgment and a writ of mandamus seeking to compel the County to participate in a binding arbitration under the terms of the applicable collective bargaining agreement between the County and its deputy constables’ bargaining association. The trial court granted Petitioner’s requests and ordered the parties to participate in binding arbitration. The court of appeals dismissed the case for want of jurisdiction, holding that deputy constables are not “police officers” under the Act and have no right to bargain collectively with their public employers. The Supreme Court reversed in part and remanded this case for further proceedings, holding that this issue was definitively resolved against the County in Jefferson County. View "Stines v. Jefferson County, Texas" on Justia Law

The arbitrator in this case did not manifestly disregard the law or the provisions of the employment agreement at issue when he awarded Defendant extended severance payments based on his finding that Defendant had been the subject of a “de facto termination.”Defendant, the former vice president and chief financial officer of CharterCAREHealth Partners (Plaintiff), invoked the “de facto termination” provision of the parties' employment agreement and requested extended severance, contending that he had suffered a material reduction in his duties and authorities as a result of change in “effective control.” Defendant’s request was denied based on the assessment that he had suffered no material reduction in duties. Defendant filed a demand for arbitration seeking to be awarded extended severance benefits pursuant to the de facto termination provision of the employment agreement. The arbitrator determined that Defendant was entitled to the eighteen-month severance proscribed in the agreement’s de facto termination clause. Plaintiff filed a petition to vacate the arbitration award. The superior court denied the motion to vacate and granted Defendant’ motion to confirm the arbitration award. The Supreme Court affirmed, holding that there was nothing in the record to support Plaintiff’s contention that the arbitrator exceeded his powers or manifestly disregarded the law or the contract. View "Prospect CharterCARE, LLC v. Conklin" on Justia Law

The arbitrator in this case did not manifestly disregard the law or the provisions of the employment agreement at issue when he awarded Defendant extended severance payments based on his finding that Defendant had been the subject of a “de facto termination.”Defendant, the former vice president and chief financial officer of CharterCAREHealth Partners (Plaintiff), invoked the “de facto termination” provision of the parties' employment agreement and requested extended severance, contending that he had suffered a material reduction in his duties and authorities as a result of change in “effective control.” Defendant’s request was denied based on the assessment that he had suffered no material reduction in duties. Defendant filed a demand for arbitration seeking to be awarded extended severance benefits pursuant to the de facto termination provision of the employment agreement. The arbitrator determined that Defendant was entitled to the eighteen-month severance proscribed in the agreement’s de facto termination clause. Plaintiff filed a petition to vacate the arbitration award. The superior court denied the motion to vacate and granted Defendant’ motion to confirm the arbitration award. The Supreme Court affirmed, holding that there was nothing in the record to support Plaintiff’s contention that the arbitrator exceeded his powers or manifestly disregarded the law or the contract. View "Prospect CharterCARE, LLC v. Conklin" on Justia Law

Smythe, a driver for both Uber and Lyft, claimed that Uber directed its drivers and others to use fake Lyft accounts to request rides, sending Lyft drivers on “wild goose chases.” He asserted claims for unfair business practices and intentional interference with prospective economic damage on behalf of a putative class of Lyft drivers. Uber moved to compel arbitration. Smythe signed agreements containing an arbitration provision that “applies to any dispute arising out of or related to this Agreement or termination of the Agreement … without limitation, to disputes arising out of or related to this Agreement and disputes arising out of or related to your relationship with the Company …. to disputes regarding any city, county, state or federal wage-hour law, trade secrets, unfair competition, compensation, breaks and rest periods, expense reimbursement, termination, harassment and claims arising under [several specific laws] and all other similar ... claims. This Agreement is intended to require arbitration of every claim or dispute that lawfully can be arbitrated.” The agreement's delegation clause states that the disputes subject to arbitration include "disputes arising out of or relating to interpretation or application of this Arbitration Provision, including the enforceability, revocability or validity .... All such matters shall be decided by an arbitrator and not by a court.” The court of appeal affirmed that Smythe’s allegations were beyond the scope of the arbitration agreement and that the delegation provision was unenforceable in this context. View "Smythe v. Uber Technologies, Inc." on Justia Law

The Supreme Court upheld the Workers’ Compensation Board of Review’s finding that, based on the preponderance of the evidence, Jimmie Lemon’s injury was work related.Jimmie Lemon filed a workers’ compensation claim claiming that his low back injury occurred in the course of and resulting from his employment with Arch Coal, Inc. The Office of Judges found the claim compensable and designated Lemon’s compensable condition as a herniated disc. The Board of Review affirmed. The Supreme Court reversed and remanded the case with directions that the claim be rejected, concluding that Lemon’s injury was not work-related. Upon reconsideration, the Supreme Court upheld the prior administrative finding that Lemon’s injury was work-related. Accordingly, the Court affirmed the decision of the Board of Review and remanded with directions to reinstate the decisions of the Office of judges and the Board of Review that Lemon’s claim was compensable. View "Arch Coal, Inc. v. Lemon" on Justia Law