Justia Arbitration & Mediation Opinion SummariesArticles Posted in U.S. 1st Circuit Court of Appeals
Manganella v. Evanston Ins. Co.
This insurance coverage dispute arose from charges of sexual harassment brought by a one-time employee against Appellant, the former president of Jasmine Company, Inc. Appellant sought a defense to and indemnity for the harassment claims from Appellee, Jasmine's liability insurance provider. The district court ruled that Appellant was not entitled to coverage from Appellee because, under the doctrine of issue preclusion, a prior arbitration between Appellant and the purchaser of his business conclusively established that Appellant's conduct fell within an exclusion to Appellee's insurance policy. The First Circuit Court of Appeals affirmed, holding (1) the arbitration presented Appellant with the full and fair opportunity for adjudication on the issue at hand; and (2) therefore, the district court was correct to bar Appellant from disputing the applicability of the exclusion based on the doctrine of issue preclusion. View "Manganella v. Evanston Ins. Co." on Justia Law
Bangor Gas Co., LLC v. H.Q. Energy Servs. (U.S.) Inc.
A pipeline owner and a natural gas supplier entered into a contract for the transportation of the supplier's natural gas. The parties later became embroiled in a dispute and submitted their dispute to binding arbitration. After the arbitrators issued a decision largely favorable to the supplier, the pipeline owner sought to vacate the decision in the district court. The district court entered judgment in favor of the supplier. The First Circuit Court of Appeals affirmed, holding (1) the arbitration panel's decision to make the pipeline owner by for the lateral costs was not in manifest disregard of the law; and (2) the panel did not compromise on the matter of the destination-end heating costs, which it imposed on the supplier for the future but declined to make the ruling retroactive; and (3) even assuming that the arbitrators committed misconduct by considering in their decision two documents among the three that the panel attached to its written decision, the misconduct could not have been prejudicial. View "Bangor Gas Co., LLC v. H.Q. Energy Servs. (U.S.) Inc." on Justia Law
Gove v. Career Sys. Dev. Corp.
Gove worked for TDC, which had a contract with Loring. TDC employees were informed that CSD had been awarded the Loring contract and would be providing services previously furnished by TDC. Gove applied online for a CSD position, similar to the one that she held with TDC. The application included a provision that any dispute with respect to any issue prior to employment, arising out of the employment process, would resolved in accord with the Dispute Resolution Policy and Arbitration Agreement adopted by CSD for its employees. When Gove was interviewed by CSD, she was visibly pregnant and was asked whether she had other children. Gove was not hired, although CSD continued to have a need for the position and continued to advertise the position. Gove filed a complaint with the Maine Human Rights Commission, which found reasonable grounds, but was unable to persuade the parties to reach agreement. She sued under Title VII of the Civil Rights Act, 42 U.S.C. 2000e, and the Maine Human Rights Act. CSD moved to compel arbitration. The district court found that the arbitration clause was ambiguous as to whether it covered an applicant who was never hired and should be construed against CSD. The First Circuit affirmed. View "Gove v. Career Sys. Dev. Corp." on Justia Law
Fantastic Sams Franchise Corp. v. FSRO Ass’n, Ltd.
In 2011, FSRO filed a Demand for Arbitration against Fantastic Sam's Franchise Corporation, on behalf of its members, who are franchisees, holding individual license agreements with Fantastic Sams. FSRO alleged that the Corporation had breached those license agreements. The Corporation filed a petition pursuant to the Federal Arbitration Act, 9 U.S.C. 4, to stay FSRO's arbitration and to compel FSRO members to arbitrate their claims individually. The district court allowed the petition as to license agreements that specifically prohibit class-arbitration. The decision in favor of the Corporation was not appealed. The court denied relief as to other agreements, which state: “Any controversy or claim arising out of or relating in any way to this Agreement or with regard to its formation, interpretation or breach shall be settled by arbitration in accordance with the Commercial Arbitration Rules of the American Arbitration Association." The First Circuit affirmed. Whether the language permits group arbitration, as requested by FSRO, is a question for the arbitrators. View "Fantastic Sams Franchise Corp. v. FSRO Ass'n, Ltd." on Justia Law
Escobar-Noble v. Ritz-Carlton Hotel
In 2001 the Hotel hired plaintiff as a casino worker. Approximately six years into his employment, he filed a charge of sex and age discrimination with the EEOC. In his complaint under Title VII, 42 U.S.C. 2000e-3(a), the Age Discrimination in Employment Act, 29 U.S.C. 623(d), and Puerto Rico law, he alleges that, shortly after he made these filings, his supervisors embarked on a pattern of retaliation ultimately resulting in his dismissal. He filed a retaliation charge with the EEOC, which issued a right-to-sue letter. Citing two agreements signed by plaintiff, each containing an arbitration clause, the Hotel moved to compel arbitration. Plaintiff argued that the agreements he had signed impermissibly shorten the limitations period, impede public enforcement of antidiscrimination laws, and unduly burden workers' rights. The district court determined that the arbitration clauses were valid and dismissed without prejudice. The First Circuit affirmed, citing the Federal Arbitration Act, 9 U.S.C. 1-16, and holding that the arbitrator can determine whether Puerto Rico law permits shortening of the limitations period. View "Escobar-Noble v. Ritz-Carlton Hotel" on Justia Law
Queens Syndicate Co. v. Herman
The district court entered an order to enforce a settlement agreement against a partner, which the partner signed after mediation of several lawsuits concerning six family-run real estate partnerships. The partner had filed no objection within the 14-day period required under the local rules. The First Circuit affirmed, rejecting the partner's challenges to subject matter jurisdiction. The court's order that the partner sign a release was within its power and claims that the settlement was ambiguous were too late.
Soto-Fonalledas v. Ritz-Carlton San Juan Hotel Spa & Casino
The employee claimed sex and disability discrimination and retaliation in violation of 42 U.S.C. 2000e. The district court granted the employer's motion to compel arbitration. The First Circuit affirmed. The company established the existence of a valid agreement. The court rejected an argument that the Spanish translation differed from the English version and held that the mutual obligation to arbitrate is supported by consideration. Claims under Title VII and the ADA are subject to arbitration; a contract reference to remedies available under the employer's rules is ambiguous and could be interpreted as allowing all of the remedies provided by the statutes. The employee, having signed a receipt, had adequate notice of the obligation to arbitrate.
Unite Here Local 217 v. Sage Hospitality Resources
In 2003 the hotel and the union entered into an agreement in anticipation of renovation of a dilapidated structure into the Renaissance Providence Hotel. The agreement allowed the union to organize hotel employees and seek recognition as their collective bargaining representative; the union would refrain from picketing or economic activity against the hotel. In 2010 the union requested recognition pursuant to the card recognition procedure described in the agreement; the hotel declined, claiming that the agreement had expired, and declined to participate in arbitration. The district court ordered arbitration. The First Circuit affirmed and awarded costs to the union. The meaning of the phrase "full public opening" in the duration clause of the agreement falls within the provision that "any dispute over ... interpretation or application" will be submitted to arbitration.
Soto v. State Indus. Prod., Inc.
The employee's complaint under the Americans with Disabilities Act was dismissed. The First Circuit affirmed, holding that the employee was required to submit to alternative dispute resolution. After examining Puerto Rico contract law and the Federal Arbitration Act, 9 U.S.C. 1, the court concluded that continued employment of the at-will employee was sufficient consideration to support the agreement, despite the fact that the agreement did not bind both parties to identical procedures. The "threat" of termination did not amount to intimidation that would invalidate consent; state law does not prohibit termination without just cause. The employee's claim that she did not understand the document because of limited English did not constitute an excuse and the agreement was not unconscionable.