Justia Arbitration & Mediation Opinion Summaries

Articles Posted in US Court of Appeals for the Eighth Circuit

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The Eighth Circuit reversed the district court's grant of summary judgment for Northport in a wrongful death action brought by plaintiff, Mark, as the representative of the estate of his deceased father. Another son, Matt, signed the admission agreement, which included an arbitration agreement, at the residential rehabilitation center owned by Northport. Northport sought to compel arbitration and the district court granted the motion. Mark appealed, asserting that the district court misused the third-party beneficiary theory when no underlying agreement was present between the Poseys and Northport. Arkansas courts have repeatedly declined to find that individuals like Matt—relatives without power-of-attorney or other legal authority who admit a family member to a nursing home—possess valid authority to bind their relatives to arbitration under a third-party beneficiary theory. In this case, because Matt was undisputedly not his father's legal guardian or attorney-in-fact, he lacked the capacity to sign the contract as his father's representative. Accordingly, the court reversed the order compelling arbitration and remanded for further proceedings. View "Northport Health Services of Arkansas, LLC v. Posey" on Justia Law

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An arbitration agreement lacking a valid delegation clause leaves the remaining arbitration agreement, as a whole, open to review for validity. The Eighth Circuit affirmed the district court's denial of PrimeLending's motion to compel arbitration against plaintiff. Plaintiff filed suit under the Fair Labor Standards Act (FLSA), alleging that she was not paid for all earned wages and overtime pay. The court held that the parties never entered into a contract relating to the arbitration provision and the delegation provision. In this case, the arbitration provision was not a validly formed contract due to a lack of acceptance. Therefore, plaintiff did not contract with PrimeLending to arbitrate any disputes between them, nor was a contract formed to delegate this decision to an arbitrator. View "Shockley v. PrimeLending" on Justia Law

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Farmers brought an interlocutory appeal of the district court's rulings interpreting an arbitration agreement in an employment contract. The Eighth Circuit dismissed the appeal based on lack of jurisdiction, holding that when a district court enters a stay instead of a dismissal, that order is not appealable. In this case, the district court's decision stayed the case pending arbitration, but did not dismiss the claims. The court held that it lacked jurisdiction under 9 U.S.C. 16(a)(1)(B) absent an order denying arbitration outright, and the court declined to apply the collateral order doctrine to find jurisdiction in this case. View "Webb v. Farmers of North America, Inc." on Justia Law

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The Eighth Circuit reversed the district court's order vacating an arbitration award originally in favor of the union. The court held that the arbitration award drew its essence from the collective bargaining agreement. In this case, the arbitrator appropriately considered the relevant language of the Recognition Clause, even though it did not quote the Recognition Clause in its entirety. Accordingly, the court remanded for further proceedings. View "National Elevator Bargaining Assoc. v. International Union of Elevator Constructors" on Justia Law

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The Eighth Circuit reversed the district court's order vacating an arbitration award reinstating a union member to his former position without back pay after he was discharged by the company. The court held that the arbitrator was at least arguably construing the contract between the parties in making the award. In this case, the arbitrator explained at length why he interpreted the contract to allow for review of the discipline and, even if there was serious error in the analysis, the arbitrator was arguably construing the contract. Furthermore, under the arbitrator's decision, the absolute cause provision established conduct for which the company has an absolute right to impose discipline, even though it did not give the company unfettered authority to select discharge as the appropriate penalty. Accordingly, the court remanded with directions to confirm the arbitration award. View "CenterPoint Energy Resources Corp. v. Gas Workers Union" on Justia Law

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In an action arising out of a fee dispute between a law firm and two clients, the action was removed to federal court and then the unpaid-fees claims proceeded to arbitration. The district court granted the firm relief from the stay and issued an order dividing the counterclaims into two categories: those the clients could raise in arbitration and those they could not. Determining that it had jurisdiction, the Eighth Circuit held that the clients' counterclaims were within the scope of what the parties agreed to arbitrate and the counterclaims seeking something else -- like money from the firm -- were not. Accordingly, the court affirmed the district court's judgment, with one exception. The court held that the district court should not have decided that the clients terminated the relationship, because the arbitrator should decide the issue. View "Meierhenry Sargent LLP v. Williams" on Justia Law

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Defendant appealed the district court's vacatur of the arbitration award plaintiff received against his insurer, Great American, for wrongfully denying his claim for damage to his corn crop. The court vacated and remanded for further proceedings, holding that vacatur of the arbitration award was improper because the arbitrators rendered a sufficiently mutual, final, and definite award. The court held that the arbitration panel's failure to break down the award by county did not mean that it was so imperfectly executed such that it rendered no mutual, final, and definite award. The court also found that the panel's written explanation for the award amount was adequate. View "Great American Insurance Co. v. Russell" on Justia Law

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Plaintiffs filed suit against GFA, alleging that GFA solicited charitable donations to benefit the poorest of the poor while covertly diverting the money to a multi-million dollar personal empire. The district court denied GFA's motion to compel arbitration. The Eighth Circuit held that the district court interpreted the scope of the arbitration agreements too narrowly, reasoning that, since none of the mission statements or pledges found in the agreements reach donations made to the church, the dispute was entirely unrelated to the parties' agreements. The court held that, even if the agreements did not reach donations made to GFA, the district court erred because the arbitration agreements did not apply only to disputes arising out of the agreements. Rather, they applied by their terms to any and all disputes of any kind arising out of the relationship between plaintiffs and GFA. Because the court could not say with positive assurance that the donations plaintiffs made to GFA did not arise out of that relationship, the court reversed and remanded. View "Dickson v. Gospel for ASIA, Inc." on Justia Law

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The Eighth Circuit affirmed the district court's judgment confirming an arbitrator's award of attorney's fees and expenses to Beumer. The court held that the arbitrator acted within the scope of his authority and did not violate the arbitration agreement's provision when he determined that attorneys' fees were "costs" and not "loss" under Missouri law. Therefore, these costs were not subject to the limitation of liability. The court held that ProEnergy failed to demonstrate grounds to vacate the arbitration award under 9 U.S.C. 10, and denied Beumer's motion for sanctions. View "Beumer Corp. v. ProEnergy Services, LLC" on Justia Law

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Plaintiffs brought a class action against Bluestem, alleging that the company engaged in unscrupulous business practices in violation of federal and state laws. The Eighth Circuit agreed with Bluestem that all of plaintiffs' claims fell within the scope of the arbitration clause. The court held that the agreements contained broad arbitration clauses and plaintiffs' state-law usury, state and federal financial disclosure and state-law unjust enrichment claims all fell within the scope of the arbitration agreements. Accordingly, the court remanded with directions to order arbitration on those claims. View "Parm v. Bluestem Brands, Inc." on Justia Law