Justia Arbitration & Mediation Opinion Summaries

Locklear Chrysler Jeep Dodge, LLC, and Locklear Automotive Group, Inc. (collectively, "Locklear"), sought a writ of mandamus to order the Bibb Circuit Court to vacate certain discovery orders in actions filed against Locklear by Rhonda Cook, James McKinney, and James Daniel Parker (collectively, "the purchasers"), who alleged that they were victims of identity theft by a Locklear employee. In July and August 2016, each purchaser alleged that the employee used the personal information from the purchaser's credit application to purchase thousands of dollars in cellular-telephone services. They asserted claims of negligence, wantonness, invasion of privacy, conversion, fraud, tort of outrage, civil conspiracy, violations of Alabama's Consumer Identity Protection Act, and breach of fiduciary duty. Shortly after filing their lawsuits, the purchasers sought general discovery, including interrogatories, requests for production of documents, requests for admissions, and notices of deposition. In response to the three actions, Locklear filed a motion in each action seeking an order compelling arbitration staying the action. The trial court held a hearing on the motions, but did not rule on them. Subsequently, each of the purchasers filed a motion to compel Locklear's responses to their discovery requests and to deem admitted their requests for admissions. The trial court granted the purchasers' motions. Locklear then filed three petitions for mandamus review. While the mandamus petitions were pending, the trial court granted Locklear's motions to stay discovery. The Alabama Supreme Court noted that, in the instant case, the issue presented for its review was not to review the trial court's order denying a motion to compel arbitration; the trial court has not yet ruled on Locklear's motion to compel. The Supreme Court was reviewing the trial court's general discovery orders, and concluded the trial court exceeded its discretion by allowing general discovery before the resolution of the issue whether the purchasers must arbitrate their claims. Furthermore, because it would be unfair to require Locklear conduct merit-based discovery prior to deciding the arbitration issue, and because Locklear could not be afforded the relief it seeks after that discovery has been conducted, Locklear does not have an adequate remedy by ordinary appeal. Accordingly, the Court granted the petitions and issued the writs, directing the trial court to vacate its orders requiring Locklear to respond to the purchasers' discovery requests, including the requests for admissions and to sit for depositions. View "Ex parte Locklear Chrysler Jeep Dodge, LLC" on Justia Law

Sargon filed a malpractice suit against BGR and BGR petitioned to compel arbitration. The Court of Appeal held that the arbitrator erred in finding that the parties' arbitration agreement included a promise to forego litigation, and thus in concluding that Sargon breached the arbitration agreement by filing a malpractice action in superior court; the arbitrator's award violated Sargon's statutory right, as articulated in the California Arbitration Act, to seek a preliminary determination of arbitrability from a court; and thus, notwithstanding the limited judicial review generally afforded arbitration awards, the present arbitration award was subject to correction. However, the court did not vacate the arbitration award in its entirety because the court could strike the portion of the arbitration award adjudicating BGR's breach of contract claim without affecting the merits of the arbitrator's summary disposition of Sargon's malpractice claim. View "Sargon Enterprises v. Browne George Ross LLP" on Justia Law

The Eleventh Circuit reversed the district court's denial of KeyBank's motion to compel arbitration on grounds of unconscionability. The court looked to Ohio law to determine where plaintiff consented to arbitrate; plaintiff consented to the 1997 Agreement and its arbitration provision; plaintiff's argument that he did not assent to the revised version of the arbitration provision that appearred in the 2009 Agreement failed; and summary judgment was warranted in this case. The court also held that the district court erred in finding the 2009 Arbitration Provision unenforceable under applicable state law. The court remanded to the district court to compel arbitration. View "Johnson v. Keybank National Assoc." on Justia Law

Jimmy Nation, Oliver McCollum, James Pickle, James Nation, Micah Nation, and Benjamin Chemeel II (collectively referred to as "the defendants") appealed the circuit court's denial of their motion to compel arbitration of a breach-of-contract claim filed against them by the Lydmar Revocable Trust ("Lydmar"). Lydmar owned a 75% membership interest in Aldwych, LLC. In 2008, Lydmar and the defendants entered into an agreement pursuant to which Lydmar agreed to sell its membership interest in Aldwych, LLC, to the defendants. The defendants paid Lydmar a portion of the agreed price at the time the agreement was executed and simultaneously executed two promissory notes for the balance of the purchase price. By 2014, Lydmar sued defendants for breach of contract for failing to make the required payments. At the request of the parties, the circuit court delayed setting the matter for a bench trial until they had an opportunity to resolve the case without a trial. The parties' attempts failed. Thereafter, defendants filed a motion to compel arbitration of Lydmar's breach-of-contract claim. Lydmar did not file a response to the defendants' motion to compel arbitration. After review, the Alabama Supreme Court reversed, finding defendants submitted evidence showing that Lydmar signed a contract agreeing that all disputes between them related to the defendants' purchase of Lydmar's membership interest in Aldwych would be settled in arbitration and that the contract evidenced a transaction affecting interstate commerce. Lydmar did not refute that evidence, nor did it establish that the defendants waived their right to rely on those arbitration provisions. Therefore, the circuit court erred by returning the case to its active docket and effectively denying the defendants' motion to compel arbitration. View "Nation et al. v. Lydmar Revocable Trust" on Justia Law

The district court lacked jurisdiction to vacate an arbitration award under the Federal Arbitration Act (FAA).Matt Karo and Michael Karo obtained federally reinsured crop insurance policies serviced by NAU Country Insurance Company (NAU). The Karos submitted “prevented planting” claims under their crop insurance policies alleging that they were unable to plant corn on certain acres due to wet conditions. NAU denied the Karos’ prevented planting claims. The parties then submitted their disputes to binding arbitration pursuant to a mandatory arbitration clause in the crop insurance policies. The arbitrator denied coverage. The Karos then sought to vacate the arbitration award under section ten of the FAA. The district court vacated the arbitration award, finding that the arbitrator exceeded his powers and manifestly disregarded the law. The Supreme court vacated the district court’s judgment and dismissed this appeal for lack of jurisdiction, holding that the district court lacked jurisdiction to enter a judgment vacating the arbitration award under the FAA because the Karos failed to comply with the three-month notice requirement of section twelve of the FAA. View "Karo v. NAU Country Insurance Co." on Justia Law

In this arbitrability dispute, the Supreme Court reversed the portion of the intermediate court of appeals’ (ICA) order denying Petitioners’ request for appellate attorneys’ fees and affirmed the portions of the ICA’s order granting Petitioners’ request for appellate costs and denying Petitioners’ request for fees and costs incurred in the circuit court without prejudice. The court held (1) for purposes of Haw. Rev. Stat. 607-14, the appeal of the arbitrability issue is a separate action from the underlying dispute on the merits; (2) Petitioners prevailed in the arbitrability action and were therefore entitled to reasonable attorneys’ fees under section 607-14 and a fee-shifting provision in a purchase agreement; and (3) as to Petitioners’ request for an order stating that they were entitled to attorneys’ fees and costs incurred in proceedings before the circuit court and in arbitration, the circuit court properly denied without prejudice to Petitioners’ right to request fees and costs from the circuit court. View "Charles v. Kapalua Bay, LLC " on Justia Law

The Fifth Circuit affirmed the district court's order compelling arbitration and final judgment in a suit between IQ and WD-40. The court held that the 1996 Agreement between the parties contained an arbitration clause and IQ acknowledges that this arbitration covered some set of claims; IQ waived its challenged to the district court's conclusion that the parties clearly and unmistakably intended to delegate the issue of arbitrability to the arbitrator by conceding it before the district court; and WD-40's assertion of arbitrability was not wholly groundless. The court also held that the arbitrators acted within their authority in deciding that the dispute was arbitrable, and the district court was correct to deny IQ's motion to vacate the award under 9 U.S.C. 10(a)(4). View "IQ Products Co. v. WD-40 Co." on Justia Law

After relator alleged that her former employer violated the federal False Claims Act (FCA), 31 U.S.C. 3730(a), (b), and Nevada FCA, the United States and Nevada declined to intervene. The employer then moved to compel arbitration under the Federal Arbitration Act (FAA), 9 U.S.C. 1 et seq. The Ninth Circuit affirmed the district court's denial of the motion to compel arbitration on an alternate ground, holding that the plain text of relator's arbitration agreement did not encompass the FCA case. View "US/Nevada ex rel. Welch v. My Left Foot Children's Therapy, LLC" on Justia Law

The “Sunoco Rewards Program,” which Sunoco advertised, offered customers who buy gas at Sunoco locations using a Citibank-issued credit card a five-cent per gallon discount either at the pump or on their monthly billing statements. The “Terms and Conditions of Offer” sheet, indicating that Citibank is the issuer of the Card, stated that by applying for the card, the applicant authorized Citibank to “share with Sunoco® and its affiliates experiential and transactional information regarding your activity with us.” Sunoco was not a corporate affiliate of and had no ownership interest in Citibank and vice versa. White obtained a Sunoco Rewards Card from Citibank in 2013. He made fuel purchases with the card at various Sunoco-branded gas station locations. White filed a purported class action against Sunoco, not Citibank, alleging that “[c]ontrary to its clear and express representations, Sunoco does not apply a 5¢/gallon discount on all fuel purchases made by cardholders at every Sunoco location. Sunoco omits this material information to induce customers to sign-up for the Sunoco. The Third Circuit affirmed the denial of Sunoco’s motion to compel arbitration. Sunoco, a non-signatory to the credit card agreement and not mentioned in the agreement, cannot compel White to arbitrate. View "White v. Sunoco Inc" on Justia Law

In November 2008, following the collapse of the housing market, the New Jersey Supreme Court implemented a statewide Residential Mortgage Foreclosure Mediation Program to address the economic crisis that left many facing the loss of their homes. After defaulting on her home loan with plaintiff GMAC Mortgage, LLC, defendant TamiLynn Willoughby entered into the Foreclosure Mediation Program. The mediation process led to an agreement between GMAC and Willoughby that gave Willoughby a path to save her home through a permanent modification of the loan. The agreement, executed in 2010, set forth the required down payment and monthly payments, the unpaid principal balance, the amount in arrears, and the length and interest rate of the loan. Willoughby complied with that agreement, paying the down payment and each monthly installment for one year. Then, GMAC began sending Willoughby proposals differing from the 2010 agreement, which GMAC claimed was provisional. Willoughby moved to enforce the 2010 settlement agreement, but instead the chancery court ordered additional mediation sessions. Willoughby never accepted in writing any of GMAC s proposals to modify the original agreement. Protracted litigation ensued. Willoughby's efforts to enforce the 2010 settlement agreement proved fruitless, and GMAC s foreclosure action ended with a Sheriff's sale of Willoughby's home. Willoughby was denied relief by the chancery court, which held that the 2010 mediation agreement was provisional and not enforceable as a final settlement agreement. The Appellate Division affirmed. The New Jersey Supreme Court reversed, concluding Willoughby and GMAC entered into an enforceable settlement agreement through the Foreclosure Mediation Program. The case was remanded to the chancery court to consider an appropriate remedy. View "GMAC Mortgage, LLC v. TamiLynn Willoughby" on Justia Law