Justia Arbitration & Mediation Opinion SummariesArticles Posted in US Court of Appeals for the Eleventh Circuit
Gherardi v. Citigroup Global Markets, Inc.
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
Lavigne v. Herbalife, Ltd.
Plaintiffs, aggrieved distributors, filed a putative class action alleging that Herbalife and the top distributors who manage the "Circle of Success" events violated the federal Racketeer Influenced and Corrupt Organizations Act by conducting the affairs of a racketeering enterprise and by conspiring to do so. The district court denied Herbalife's motion to compel arbitration of the aggrieved distributors' claims against the top distributors and denied the motion to transfer those claims to the Central District of California.The Eleventh Circuit held that the district court correctly denied the top distributors' motion to compel arbitration, because none of the top distributors is a party to any of the aggrieved distributors' agreements and thus they cannot invoke the agreements' arbitration clauses; the district court was correct to resolve the motion to compel arbitration instead of immediately sending it to an arbitrator; and the district court correctly declined to apply equitable estoppel to compel arbitration of the aggrieved distributors' claims against the top distributors. Finally, the court held that it is without jurisdiction to review whether the district court erred in denying the motion to transfer venue. Accordingly, the court affirmed in part and dismissed in part. View "Lavigne v. Herbalife, Ltd." on Justia Law
EGI-VSR, LLC v. Juan Carlos Celestino Coderch Mitjans
Respondent appealed the district court's order confirming a $28 million international arbitration award in favor of EGI. EGI sought to enforce the Chilean award in the U.S. District Court for the Southern District of Florida by filing a petition to confirm the international arbitration award under the Federal Arbitration Act.The Eleventh Circuit agreed with the district court that service in Brazil was proper and that this arbitration award should be confirmed. The court held that the district court did not err in finding that considerations of international comity counseled against reviewing the Brazilian court's determination that respondent had been properly served in accordance with Brazilian law, especially since the Convention on Letters Rogatory commits jurisdiction of this issue to the courts of Brazil.However, the court vacated the district court's order and remanded with instructions to correct two errors that the district court committed in enforcing the award. In this case, the district court clearly erred in accepting EGI's calculations, which converted UF to pesos to U.S. dollars on January 23, 2012, rather than the proper conversion date under the breach day rule, January 13, 2012. Furthermore, instead of enforcing the Arbitration Award as requested by EGI, the district court's order should have required respondent to pay the purchase price set out in the Shareholders' Agreement and the Award and in exchange required EGI to tender its shares. View "EGI-VSR, LLC v. Juan Carlos Celestino Coderch Mitjans" on Justia Law
Cvoro v. Carnival Corp.
Plaintiff appealed the denial of her petition to "vacate and/or alternatively to deny recognition and enforcement" of the foreign arbitral award in favor of her employer, Carnival, on her claims under the Jones Act and U.S. maritime law for injuries related to her carpal tunnel.The Eleventh Circuit affirmed the district court's denial of the petition, holding that plaintiff failed to establish that the foreign arbitral award offended the United States' most basic notions of morality and justice. Weighing the policies at issue and considering the specific unique factual circumstances of this case, the court held that plaintiff's Article V(2)(b) of the New York Convention defense failed. Therefore, the court held that the district court did not err in denying plaintiff's request that it refuse to enforce the arbitral award and dismissing her claims. View "Cvoro v. Carnival Corp." on Justia Law
Managed Care Advisory Group, LLC v. Cigna Healthcare, Inc.
The Eleventh Circuit held that the district court order was final and its retention of jurisdiction to review the arbitrator's decision did not destroy the finality of the district court's ruling pertaining to the enforcement of the arbitral summonses. The court also held that the district court's determination that it had ancillary jurisdiction was appropriate. However, the magistrate judge improperly found jurisdiction on two additional grounds: (1) the district court appointed the arbitrator; and (2) the parties agreed to jurisdiction of the district court in their arbitration agreement.The court interpreted the plain meaning of Section 7 as (1) requiring summonsed non-parties to appear in the physical presence of the arbitrator as opposed to a video conference or teleconference; and (2) prohibiting pre-hearing discovery. In this case, the district court abused its discretion in enforcing the arbitral summonses because the court lacked power under Section 7 to order the witnesses to appear at the video conference and provide pre-hearing discovery. The court also held that the district court's order denying CIGNA's motion to enforce the Settlement Agreement and compel an accounting constitutes a post-judgment order that is final and appealable. The district court abused its discretion here by allowing the arbitrator to review the claims that have already been paid. Accordingly, the court reversed and remanded. View "Managed Care Advisory Group, LLC v. Cigna Healthcare, Inc." on Justia Law
Inversiones Y Procesadora Tropical Inprotsa, S.A. v. Del Monte International GMBH
The Eleventh Circuit affirmed the district court's orders denying INPROTSA's petition to vacate and confirming an international arbitral award issued for Del Monte. The court had subject matter jurisdiction over the petition to vacate because Congress intended 9 U.S.C. 203 to be read consistently with section 205 as conferring subject-matter jurisdiction over actions or proceedings sufficiently related to agreements or awards subject to the Convention.The court held that the district court did not err by dismissing the petition to vacate, because INPROTSA did not assert a valid defense under the Convention in light of Industrial Risk Insurers v. M.A.N. Gutehoffnungshütte GmbH, 141 F.3d 1434, 1446 (11th Cir. 1998). Even if the district court were not bound by Industrial Risk, the petition to vacate would warrant denial, because the district court did not exceed its power by reasonably construing its own rules as barring substantive reconsideration of the merits of its damages award. Finally, the court held that the district court did in fact rule on the merits of INPROTSA's public policy defenses and held that enforcing the arbitral award did not offend public policy. View "Inversiones Y Procesadora Tropical Inprotsa, S.A. v. Del Monte International GMBH" on Justia Law
Dye v. Tamko Building Products, Inc.
Where a roofing shingle manufacturer displays on the exterior wrapping of every package of shingles the entirety of its product-purchase agreement—including, as particularly relevant here, a mandatory-arbitration provision— homeowners whose roofers ordered, opened, and installed the shingles are bound by the agreement's terms. The Eleventh Circuit held that the manufacturer's packaging in this case sufficed to convey a valid offer of contract terms, that unwrapping and retaining the shingles was an objectively reasonable means of accepting that offer, and that the homeowners' grant of express authority to their roofers to buy and install shingles necessarily included the act of accepting purchase terms on the homeowners' behalf. Therefore, the court affirmed the district court's decision to grant the manufacturer's motion to compel arbitration and to dismiss the homeowners' complaint. View "Dye v. Tamko Building Products, Inc." on Justia Law
JPay, Inc. v. Kobel
The Eleventh Circuit held that the district court correctly determined that the availability of class arbitration was a question of arbitrability, presumptively for the court to decide, because it was the kind of gateway question that determined the type of dispute that would be arbitrated. In this case, defendants sought to compel arbitration on a class basis with JPay, a Miami-based company that provides fee-for-service amenities in prisons in more than thirty states.The court held, however, that the language the parties used in their contract expressed their clear intent to overcome the default presumption and to arbitrate gateway questions of arbitrability, including the availability of class arbitration. Therefore, the court vacated the district court's grant of summary judgment to JPay, reversed the denial of defendants' motion to compel arbitration, and remanded for further proceedings. View "JPay, Inc. v. Kobel" on Justia Law
Outokumpu Stainless USA, LLC v. Converteam SAS
At issue was two questions under the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the Convention) regarding federal subject matter jurisdiction established in an arbitration agreement and whether the parties entered into an agreement under the meaning of the Convention to arbitrate their dispute.Plaintiff’s predecessor entered into contracts that contained arbitration clauses and included “subcontractors.” Defendant was listed as a subcontractor. Plaintiff and its insurers later filed suit, and the case was removed to federal district court. The district court denied Plaintiffs’ motion to remand and granted Defendant’s motions to compel and dismiss. The Eleventh Circuit affirmed the district court’s denial of the motion to remand but reversed and remanded the order compelling arbitration, holding (1) where jurisdiction is challenged on a motion to remand, the district court shall perform a limited inquiry to determine whether the suit “relates to” an arbitration agreement pursuant to the Convention under the factors articulated in Bautista v. Star Cruises, 396 F.3d 1289 (11th Cir. 2005); and (2) on a motion to compel arbitration, the district court must engage in a rigorous analysis of the Bautista factors to determine whether the parties entered into an agreement under the meaning of the Convention to arbitrate their dispute. View "Outokumpu Stainless USA, LLC v. Converteam SAS" on Justia Law
Spirit Airlines, Inc. v. Maizes
At issue in this appeal was whether it was a judge or an arbitrator who must decide if the arbitration agreement between Spirit Airlines and members of its $9 Fare Club allows for arbitration of claims brought by a class of claimants. The Eleventh Circuit held that the agreement's choice of American Arbitration Association rules, standing alone, was clear and unmistakable evidence that Spirit intended that the arbitrator decide this question. Therefore, the district court was not permitted to rely on testimony from Spirit's vice president to explain the agreement's meaning, and was correct to reject the offer of that testimony. The court affirmed the judgment of the district court. View "Spirit Airlines, Inc. v. Maizes" on Justia Law