Justia Arbitration & Mediation Opinion Summaries

Defendant and the chief financial officer of NRMC signed three documents detailing terms upon which defendant would provide audit services for NRMC. Defendant moved to compel arbitration and to stay proceedings in federal district court pending arbitration. The district court denied the motions. At issue in this interlocutory appeal was whether the "minutes rule," also known as the "minutes requirement," under Mississippi law pertains to the issue of the contract's validity, or instead more closely resembles whether the alleged obligor NRMC ever signed the contract. The court concluded that, with respect to the 2010 and 2012 engagement letters, the minutes rule pertains to whether written agreements between NRMC and defendant were formed in each of those years. Therefore, whether written contracts were consummated was a question for the courts rather than an arbitrator. The court also concluded that because of the minutes requirement, the 2010 and 2012 engagement letters were not contracts to which NRMC was a party. Therefore, NRMC was not a party to the arbitration provisions contained in the 2010 and 2012 engagement letters. The court further concluded that the minutes of NRMC's board reflect that an agreement with defendant was reached in 2009. Therefore, the minutes rule does not pertain to that contract's formation. On remand, the district court should determine the scope of the arbitration agreement. Finally, the court concluded that the Mississippi minutes rule was one of general applicability to Mississippi contracts with public entities and the requirement of section 2 of the Federal Arbitration Act (FAA), 9 U.S.C. 2, that courts must place arbitration agreements on an equal footing with other contracts does not foreclose its application in this case. The court affirmed as to the 2010 and 2012 engagement letters, vacated as to the 2009 engagement letter, and remanded. View "Lefoldt, Jr. v. Rentfro" on Justia Law

Plaintiff opened a credit card account with Defendant Citibank, N.A. and purchased a credit protector plan. Defendant later amended the original agreement by adding an arbitration provision. The provision waived the right to seek public injunctive relief in any forum. The arbitration provision became effective in 2001. In 2011, Plaintiff filed this class action based on Defendant’s marketing of the Plan and the handling of a claim she made under it when she lost her job, alleging claims under the Consumers Legal Remedies Act (CLRA), the unfair competition law (UCL), and the false advertising law. Defendant petitioned to compel Plaintiff to arbitrate her claims on an individual basis pursuant to the arbitration provision. Based on the Broughton-Cruz rule, the trial court ordered Plaintiff to arbitrate all claims other than those for injunctive relief under the UCL, the CLRA, and the false advertising law. The Court of Appeal reversed and remanded for the trial court to order all of Plaintiff’s claims to arbitration, concluding that the Federal Arbitration Act preempts the Broughton-Cruz rule. The Supreme Court reversed, holding that the arbitration provision was invalid and unenforceable because it waived Plaintiff’s right to seek public injunctive relief in any forum. Remanded. View "McGill v. Citibank, N.A." on Justia Law

After an arbitral tribunal in London found the Government of Belize in breach of a settlement agreement with The Bank of Belize Limited, the tribunal ordered that Belize pay the Bank a substantial monetary award. Belize subsequently petitioned for enforcement of the award in district court. The district court granted the petition and Belize appealed, raising multiple challenges. The court accorded Belize's arguments full consideration after careful examination of the record and found them either largely asked and answered by Circuit precedent, or otherwise properly resolved by the district court. The court rejected Belize's argument that the district court's enforcement of the arbitral award violated the New York Convention because it was "contrary to the public policy of" the United States pursuant to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards of June 10, 1958, art. V(2)(b), 21 U.S.T. 2517, T.I.A.S. 2517, T.I.A.S. No. 6997, 330 U.N.T.S. 3 (1970); 9 U.S.C. 207. Accordingly, the court affirmed the judgment. View "Belize Bank Limited v. Government of Belize" on Justia Law

In New Jersey, GTL is the sole provider of telecommunications services that enable inmates to call approved persons outside the prisons. Users can open an account through GTL’s website or through an automated telephone service with an interactive voice-response system. Website users see GTL’s terms of use and must click “Accept” to complete the process. Telephone users receive an audio notice: Please note that your account, and any transactions you complete . . . are governed by the terms of use and the privacy statement posted at www.offenderconnect.com.” Telephone users are not required to indicate their assent to those terms, which contain an arbitration agreement and a class-action waiver. Users have 30 days to opt out of those provisions. The terms state that using the telephone service or clicking “Accept” constitutes acceptance of the terms; users have 30 days to cancel their accounts if they do not agree to the terms. Plaintiffs filed a putative class action alleging that GTL’s charges were unconscionable and violated the state Consumer Fraud Act, the Federal Communications Act, and the Takings Clause. GTL argued that the FCC had primary jurisdiction. Plaintiffs withdrew their FCA claims. GTL moved to compel arbitration. The district court denied GTL’s motion with respect to plaintiffs who opened accounts by telephone, finding “neither the knowledge nor intent necessary to provide ‘unqualified acceptance.’” The Third Circuit affirmed. The telephone plaintiffs did not agree to arbitration. View "James v. Global TelLink Corp." on Justia Law

The right of firefighters and police officers to collectively bargain for purposes of wages, hours, and working conditions was secured through the Police and Firemen Collective Bargaining Act, commonly known as Act 111. Appellant, the International Association of Fire Fighters, Local 302 (“IAFF”), was the exclusive bargaining representative for the firefighters of Appellee, the City of Allentown (the “City”), for purposes of collective bargaining with the City. The City and the IAFF were parties to a seven-year collective bargaining agreement which ran from January 1, 2005 through December 31, 2011. In this appeal by allowance, the issue this case presented for the Supreme Court's review was, in the context of an interest arbitration award, whether a provision requiring a certain minimum number of firefighters on duty per shift is a mandatory subject of bargaining or a non-bargainable managerial prerogative. The Court concluded that the number of required firefighters per shift was a mandatory subject of bargaining, and implicated managerial responsibilities, but did not unduly infringe upon those managerial rights, and, thus, could properly serve as a component of an interest arbitration award. The Court reversed the Commonwealth Court, which held to the contrary. View "City of Allentown v. Int'l Assoc. of Firefighters" on Justia Law

Lender’s assignee (Assignee), while operating as an unlicensed debt collector, obtained a judgment against a credit card debtor (Debtor) in district court. Debtor’s contract with Lender included an arbitration provision. Debtor then filed a class action suit collaterally attacking the judgment based on violations of Maryland consumer protection laws. Assignee filed a motion to arbitrate the class action suit pursuant to an arbitration clause between Lender and Debtor. Assignee moved to compel arbitration. The circuit court granted the motion to compel, thus rejecting Debtor’s argument that Assignee waived its right to arbitrate when it brought its collection action against Debtor. The Court of Special Appeals affirmed. The Court of Appeals reversed, holding that because Assignee’s collection action was related to Debtor’s claims, Assignee waived its contractual right to arbitrate Debtor’s claims when it chose to litigate the collection action. View "Cain v. Midland Funding, LLC" on Justia Law

Farrar was hired by Direct Commerce as its vice-president of business development and negotiated an employment agreement set forth in a six-page offer letter detailing her compensation, additional bonus structure, and stock options. The agreement also included an arbitration provision, set off by the same kind of underlined heading and spacing as the other enumerated paragraphs of the agreement. When Farrar sued Direct, alleging breach of contract, conversion, wrongful termination, breach of the covenant of good faith and fair dealing, and failure to pay wages owed and waiting time penalties, the employer unsuccessfully sought to compel arbitration. The trial court found the arbitration provision procedurally and substantively unconscionable. The court of appeals reversed. While the arbitration provision is one-sided, as it excludes any claims arising from the confidentiality agreement Farrar also signed, that offending exception is readily severable and, on this record, should have been severed. View "Farrar v. Direct Commerce, Inc." on Justia Law

In August 2012, Aliments, a Canadian snack purveyor, contacted its American broker, Sterling, to purchase thousands of pounds of raw pistachios. Sterling contacted Pacific, another broker, which called Nichols, a California pistachio grower, who agreed to the proposed quantity and price. In September, Sterling contacted Pacific with another order from Aliments. Pacific contracted with Nichols again. Sterling sent sales confirmations to Aliments and Pacific. Pacific did not forward the Sterling sales confirmations to Nichols but issued its own confirmations to Nichols and Sterling. Neither Aliments nor Nichols was aware that two confirmations existed, with the same terms, including a 30-day credit term. However, while Sterling’s confirmations contained arbitration clauses, not all of the confirmations generated by Pacific contained arbitration clauses. Aliments believed that the Sterling confirmations, though unsigned by either party, represented binding contracts to purchase pistachios from Nichols, with payment due 30 days from delivery, “as usual.” Nichols thought that the 30-day term was but a placeholder. The parties were unable to agree to payment terms. Despite being notified of an arbitration, Nichols did not attend. Aliments was awarded $222,100 in damages. Nichols refused to pay. The district court denied Aliments’ petition to enforce the award and granted Nichols’s cross-petition to vacate because no genuine issue of material fact existed as to whether the parties failed to enter into “an express unequivocal agreement” to arbitrate. The Third Circuit vacated, finding multiple issues of fact. View "Aliments Krispy Kernels Inc v. Nichols Farms" on Justia Law

Robert Newell’s wife Lisa passed away at their home in 2013. Newell requested that Lisa's body be transported to Mobile Memorial Gardens Funeral Home. However, unbeknownst to Newell, Lisa's body was transported to Radney Funeral Home. The following day Newell, accompanied by his sister, two daughters, and a son-in-law, went to Mobile Memorial Gardens Funeral Home to make the final arrangements for Lisa. Richard Johnson III, an employee of Mobile Memorial Gardens, informed Newell at that time that Lisa's body had been transported to Radney Funeral Home instead of Mobile Memorial Gardens. According to Newell, Johnson informed him that Lisa's body had been transported to Radney because Radney was now a part of the Dignity Memorial Company (both a part of SCI Alabama Funeral Services, LLC) and because Mobile Memorial Gardens did not have a crematory service. Newell informed Johnson during the meeting that he wanted Lisa's remains cremated and that he wanted to conclude the process as soon as possible. Newell executed a contract providing for the disposition of Lisa's remains by cremation. Newell contended that after Lisa's memorial service, SCI did not return any of his telephone calls or e-mails inquiring as to the status of Lisa's remains. Newell eventually went to Radney Funeral Home, learning at that time that Lisa had not yet been cremated because the funeral home had not yet received the death certificate. Newell alleged that he was emotionally distraught over the state of Lisa’s remains, and ultimately sued SCI for negligence, wantonness, the tort of outrage, and fraud. SCI moved to compel arbitration, but Newell resisted, arguing the terms of the arbitration provision at issue were grossly favorable to SCI and that SCI had overwhelming bargaining power over a grieving husband. The trial court granted the motion. Newell appealed. Finding no error in the judgment granting SCI’s motion to compel arbitration, the Supreme Court affirmed. View "Newell v. SCI Alabama Funeral Services, LLC" on Justia Law

Plaintiffs Emelia Jackson and Tahisha Roach purchased used cars from BM Motoring, LLC, and Federal Auto Brokers, Inc., doing business as BM Motor Cars (collectively, BM). As part of the transaction, each plaintiff signed an identical DRA, which required resolution of disputes through an arbitration in accordance with the rules of the AAA before a retired judge or an attorney. Two months later, Jackson filed a demand for arbitration against BM with the AAA, asserting a claim under the New Jersey Consumer Fraud Act (CFA) for treble damages and other relief based on overcharges and misrepresentations by BM. Despite repeated requests by the AAA, BM did not advance the filing fees that the DRA obligated it to pay, or otherwise respond to the claim. The AAA dismissed Jackson’s arbitration claim for non-payment of fees. Six months after her vehicle purchase, Roach filed a complaint in the Superior Court against BM, and similarly, received no response from BM in response to the arbitration demand. Plaintiffs then filed this action against defendants, who moved to dismiss the complaint in favor of arbitration. Defendants contended that they did not contemplate using the AAA as the forum for arbitration, and consistently had not arbitrated customer disputes before the AAA, because of the excessive filing and administrative fees that the AAA charged. In opposition to the motion, plaintiffs asserted that defendants materially breached the DRA by failing to advance filing and arbitration fees, and waived their right to arbitration. Defendants contended that they neither breached the DRA nor waived arbitration because the AAA was not the appropriate arbitral forum. The trial court found that the parties intended to resolve disputes by arbitration. The court ordered the parties to attempt to reinstate plaintiffs’ claims with the AAA; if the AAA refused to administer the claim, plaintiffs could reinstate their complaint. The AAA reinstated the arbitration, and the court dismissed plaintiffs’ complaint with prejudice. The Appellate Division affirmed the dismissal of the complaint, finding that there was a sufficient factual dispute as to the proper forum for arbitration that defendants conduct did not constitute a material breach of the DRA, nor did they voluntarily and intentionally waive their right to enforce the DRA. The Supreme Court reversed the trial court’s judgment, finding defendants’ non-payment of filing and arbitration fees amounted to a material breach of the DRA. Defendants were therefore precluded from enforcing the arbitration provision, and the case proceeded in the courts. View "Roach v. BM Motoring, LLC" on Justia Law