Justia Arbitration & Mediation Opinion Summaries

After BIVI discharged an employee for falsifying work records, the Union grieved the discharge. BIVI and the Union submitted the dispute to arbitration, the arbitrator ordered that the employee be reinstated without back pay, and BIVI commenced this action to vacate the arbitration award. The district court granted summary judgment to the Union and BIVI appealed. The court concluded that the arbitrator's award drew its essence from the collective bargaining agreement (CBA) where BIVI's Article VIII, Section 3(d) argument was waived and where the arbitrator conducted a straightforward balancing of the management rights and just cause provisions. The court also concluded that BIVI has not made the factual and legal showing that would be required for the court to invoke the narrow public policy exemption and vacate an arbitration award that fully acknowledged the employee's misconduct, denied her back pay as a result of that misconduct, but reinstated her to her former position. Accordingly, the court affirmed the judgment of the district court. View "Boehringer Ingelheim Vetmedica v. UFCW" on Justia Law

In 2004 GEA, a German company, agreed to sell a subsidiary, DNK, to Flex‐N‐Gate, a U.S. manufacturer for €430 million. The contract required arbitration of all disputes in Germany. The sale did not close. GEA initiated arbitration before the Arbitral Tribunal of the German Institution of Arbitration. The arbitration was pending in 2009 when GEA filed suit in an Illinois federal district court, against Flex‐N‐Gate and its CEO, Khan, alleging that the defendants had fraudulently induced it to enter into the contract; that Khan stripped the company of assets so that it would be unable to pay any arbitration award; and that Khan was Flex‐N‐Gate’s alter ego. GEA then asked the district judge to stay proceedings, including discovery. The judge declined to stay discovery. GEA filed a notice of appeal after the German arbitration panel awarded GEA damages and costs totaling $293.3 million. The Seventh Circuit dismissed GEA’s appeal as moot, but the German Higher Regional Court in vacated the arbitration award. GEA renewed its motion. The district judge again denied the stay, stating that he was unsure how the arbitration would affect the case before him and didn’t want to wait to find out. The Seventh Circuit reversed. The district judge then imposed a stay, which it later lifted for the limited purpose of allowing Khan to conduct discovery aimed at preserving evidence that might be germane to GEA’s claims against him in the district court suit. The Seventh Circuit affirmed, first holding that it had appellate jurisdiction.View "GEA Group AG v. Baker" on Justia Law

This appeal arose out of a protracted dispute over attorneys' fees awarded in the Wal-Mart wage and hour multidistrict litigation. Appellants, the Burton Group, appealed from the district court's confirmation of an arbitration award allocating attorneys' fees, contending that the district court erred in declining to vacate the award under section 10(a) of the Federal Arbitration Act (FAA), 9 U.S.C. 10(a). The court concluded that a non-appealability clause in an arbitration agreement that eliminates all federal court review of arbitration awards, including review under section 10(a) of the FAA, was not enforceable. Accordingly, the court proceeded to the merits of the Burton Group's claims, and affirmed the district court's confirmation of the arbitration award in a memorandum disposition filed contemporaneously with this opinion. View "In re: Wal-Mart" on Justia Law

When Plaintiff retained a Maine law firm to represent him in a legal action, he signed an attorney-client engagement letter that contained an arbitration provision. Plaintiff later sued the law firm and individual defendants (collectively, Defendants) for malpractice and violations of Maine's Unfair Trade Practices Act. Defendants moved to compel arbitration and dismiss the action. The district court granted the motion under the Federal Arbitration Act (FAA). Plaintiff appealed, arguing that the district court erred in enforcing the arbitration clause. The First Circuit Court of Appeals affirmed, holding that the district court did not err in granting the motion to compel arbitration and dismissed the action, as (1) Maine professional responsibility law for attorneys permits arbitration of legal malpractice claims so long as there is no prospective limitation on the law firm's liability; and (2) Maine law, like the FAA, is not hostile to the use of the arbitration forum, and Maine would enforce the arbitration of malpractice claims provision in this case. View "Bezio v. Draeger" on Justia Law

After plaintiff purchased a background check and report from Intelius on the Internet, plaintiff discovered that Adaptive, a separate company from Intelius, had been charging his credit card each month for a Family Safety Report. Plaintiff and others filed suit against Intelius in state court. Intelius then filed a third-party complaint against Adaptive. Adaptive filed a motion to compel arbitration of both Intelius's and plaintiff's claims. The court held that plaintiff did not enter into a contract with Adaptive to purchase the Family Safety Report, and did not enter into a contract with Adaptive to arbitrate. Therefore, the court affirmed the district court's denial of the motion to compel. The court remanded for further proceedings. View "Lee v. Intelius Inc." on Justia Law

Plaintiff filed a class action complaint against JEM, a "back-end" debt-relief company, and others, alleging breach of fiduciary duty, unjust enrichment, aiding and abetting, civil conspiracy, and breach of Washington consumer protection statutes. On appeal, JEM appealed from the district court's denial of its motion to compel arbitration. The court concluded that the district court correctly decided that it, rather than an arbitrator, should decide whether the arbitration clause in the attorney retainer agreement was unconscionable. The court also concluded that the district court properly decided, using non-preempted Washington law, that the arbitration clause was unenforceable. Accordingly, the court affirmed the judgment of the district court. View "Smith v. JEM Group, Inc." on Justia Law

Plaintiffs filed suit against RAC after entering into a rental agreement with RAC for a wooden trundle bed and mattress infested with bedbugs. On appeal, plaintiffs challenged the district court's order compelling arbitration of their breach of warranty claim under the Magnuson-Moss Warranty Act, 15 U.S.C. 2301 et seq. Relying on regulation promulgated by the FTC under its authority to interpret the Act, plaintiffs argued that RAC could not require binding arbitration as part of a consumer warranty. The court concluded that the district court erred in holding that the FTC regulations contained no ban on binding arbitration. However, the FTC arbitration ban simply did not apply to plaintiffs' rental agreement with RAC. Because plaintiffs have not linked RAC's warranty to any sale, they failed to establish the existence of a written warranty under FTC regulations. Accordingly, the binding arbitration clause was enforceable and the court affirmed the judgment of the district court. View "Seney v. Rent-a-Center, Inc." on Justia Law

This case concerned a dispute involving certain equipment Dakota purchased from the Kloster division of Tromley. On appeal, Tromley appealed the district court's denial of its motion to compel arbitration. Because the arbitration provision was not readily available and because Dakota did not have a reasonable opportunity to reject it, Tromley could not establish the necessary consent to bind Dakota to that provision. Further, the emails exchanged between Dakota and Tromley in June and July 2010 did not constitute an addendum to their agreement which successfully incorporated the arbitration agreement where the court could not say that the parties mutually assented to modify their agreement to include the provision. Accordingly, the court affirmed the judgment of the district court. View "Dakota Foundry, Inc. v. Tromley Industrial Holding" on Justia Law

The multinational telecommunications firm Nortel declared bankruptcy in 2009 and various debtors comprising the Nortel brand auctioned their business lines and intellectual property, raising $7.5 billion. The debtors subsequently disputed whether they had agreed to allocate the auction funds through arbitration. The Bankruptcy Court held that they had not agreed to arbitrate their disputes about allocation. The Third Circuit affirmed: the contract at issue does not reflect the debtors’ intent to arbitrate disputes about the auction funds. The court declined to consider the Joint Administrators’ related challenge to the Bankruptcy Court’s decision to allocate the contested funds, noting that the Bankruptcy Court has not yet held the hearing to allocate the funds, so that review would be premature. View "In Re: Nortel Networks, Inc." on Justia Law

Plaintiff Air Method Corporation terminated a helicopter pilot, Jeff Stackpole, following a 2010 incident. Defendant Office and Professional Employees International Union Local 109 (OPEIU) represented Mr. Stackpole throughout the arbitration process. After the arbitration award was granted in Mr. Stackpole’s favor, Plaintiff filed a complaint against OPEIU Local 109 pursuant to the Railway Labor Act, seeking to vacate the award. On cross-motions for summary judgment, the district court ruled in favor of Defendants, thereby upholding the arbitration award. Plaintiff appealed the district court’s decision. Finding no reversible error, the Tenth Circuit affirmed the arbitration award. View "Air Methods Corporation v. OPEIU, et al" on Justia Law