Justia Arbitration & Mediation Opinion Summaries

Petitioner William Daane defaulted on a loan secured by a mortgage on his residence. CR Title Services, the trustee of the deed of trust, filed a notice of default to initiate the foreclosure process. Daane opted to participate in the Foreclosure Mediation Program (Program). The district court later found that CitiMortgage, the beneficiary of the deed of trust, had participated in the mediation in bad faith. After the foreclosure process was reinitiated, Daane again elected for mediation in the Program. Daane subsequently brought a petition for a writ of prohibition, seeking to preclude the Program from proceeding with further mediations or issuing a letter of certification. The Supreme Court denied the writ, holding that a writ of prohibition was unwarranted to preclude the Program from conducting further proceedings with respect to Daane's residence because he had an adequate remedy in the ordinary course of law. View "Daane v. Eighth Judicial Dist. Court" on Justia Law

Appellant Marcus Minix received documents from the county mediator stating that the county court had received a complaint against him for a violation of Ky. Rev. Stat. 514.030 and directing Appellant to mediation. After attending mediation, Appellant was informed he may need to return to mediation. Appellant petitioned the court of appeals for a writ prohibiting the county attorney from referring felony criminal complaints, including a felony complaint against him, to a mediator before presenting the complaints to a district court for review and issuance of a summons or warrant. The court of appeals denied the petition, finding it was without jurisdiction to address Appellant's claims. The Supreme Court affirmed, holding that a writ of prohibition may not be issued against non-judicial parties such as the Appellees, the county attorney and the mediator, and the substantive relief Appellant sought was within the original jurisdiction of the circuit court, not the court of appeals. View "Minix v. Roberts" on Justia Law

This case stemmed from plaintiff's allegations that, while she was employed with defendant on one of its cruise ships, she was drugged by other employees, raped, and physically injured while she was unconscious, and when she reported to officials of the cruise line what had happened to her, they treated her with indifference and even hostility, failed to provide her with proper medical treatment on board, and interfered with her attempts to obtain medical treatment and counseling ashore. Plaintiff subsequently asserted five claims against defendant involving violations of the Jones Act, 46 U.S.C. 30104, or the general maritime law applicable to the Seaman's Wage Act, 46 U.S.C. 10313. Plaintiff's remaining five claims involved common law tort claims. At issue was whether plaintiff's claims fell within the scope of the arbitration clause in the crew agreement. The court held that the district court did not err in holding that Counts VI, VII, VIII, IX, and X of plaintiff's complaint did not fall within the scope of the arbitration provision where all five of these claims involved factual allegations about how the cruise line and its officials treated plaintiff after learning that she had been raped, including allegations that she was kept on the ship against her will, that she was prevented from getting medical attention off the ship, that her rape kit was destroyed in the incinerator, and that her confidentiality as a rape victim was intentionally violated. The court held, however, that the remaining five counts arose directly from her undisputed status as a "seaman" employed by defendant and fell within the scope of the arbitration provision. Therefore, the district court erred in denying defendant's motion to compel arbitration for Counts I, II, III, IV, and V. View "Doe v. Princess Cruise Lines, Ltd." on Justia Law

Plaintiff brought suit against the Dealership and Porsche when the pre-owned car that she purchased from the Dealership developed serious mechanical problems during the warranty period and the Dealership refused to honor her warranty claims. Plaintiff alleged breach of implied and express warranties under the Magnuson-Moss Warranty Act (MMWA), 15 U.S.C. 2301 et seq., and breach of contract and unconscionability under California law. The district court granted the Dealership's petition to compel arbitration pursuant to the mandatory arbitration provision in the sales contract that plaintiff signed when she bought the car and stayed the action against Porsche. Plaintiff's principal argument on appeal was that the MMWA barred the provision mandating pre-dispute binding arbitration of her warranty claims against the Dealership. Although the text of the MMWA did not specifically address the validity of pre-dispute mandatory binding arbitration, Congress expressly delegated rulemaking authority under the statue to the Federal Trade Commission (FTC). The FTC construed the MMWA as barring pre-dispute mandatory binding arbitration provisions covering written warranty agreements and issued a rule prohibiting judicial enforcement of such provisions with respect to consumer claims brought under the MMWA. Because it was required to defer to the reasonable construction of a statute by the agency that Congress had authorized to interpret it, the court held that the MMWA precluded enforcement of pre-dispute agreements such as Porsche's that required mandatory binding arbitration of consumer warranty claims. The court declined to address plaintiff's remaining claims. Accordingly, the court reversed and remanded for further proceedings. View "Kolev v. Euromotors West/The Auto Gallery, et al." on Justia Law

Plaintiff brought suit against Toyota when the new car that she leased developed mechanical problems during the warranty period and Toyota failed to repair them to her satisfaction. In addition to several California state law claims, she alleged breach of warranty under the Magnuson-Moss Warranty Act (MMWA), 15 U.S.C. 2301 et seq. The district court granted Toyota's motion to dismiss for lack of subject matter jurisdiction on the ground that plaintiff did not, before filing suit in civil court, pursue her claims through the California Dispute Settlement Program (CDSP) that Toyota maintained and specified in its warranty. Plaintiff appealed, arguing that her failure to initially resort to the CDSP provided Toyota an affirmative defense to her warranty claims under the MMWA, but did not defeat subject matter jurisdiction. The court held that the prerequisite in section 2310(a) of the MMWA that a "consumer may not commence a civil action... unless he initially resorts to [an informal dispute settlement procedure]" was merely a codification of the MMWA's exhaustion requirement and did not operate as a jurisdictional bar. Accordingly, the court reversed and remanded so that the district court could consider how to proceed with the instant action, including the failure-to-exhaust issues. View "Maronyan v. Toyota Motor Sales, U.S.A., Inc." on Justia Law

The Union, representing certain employees at ExxonMobil's Baton Rouge refinery and chemical plant, brought suit to compel ExxonMobil to arbitrate two labor grievances pursuant to the parties' collective bargaining agreement. The court held that it was within the province of the courts to decide whether "a good faith claim by one party that the other party had violated a written provision" of the bargaining agreement had been asserted. The court also held that, in light of the clairty of the parties' agreement, the Union's claim that ExxonMobil violated Section 1131 of the agreement when the language of that section explicitly authorized its actions was not colorable and could not constitute a good faith claim within the meaning of the arbitration clause. The court agreed with ExxonMobil that Baton Rouge Oil & Chemical Workers Union v. ExxonMobil Corp foreclosed reliance on Section 1151 of the agreement as an independent basis for the arbitrability of the contracting-out grievance. The court further held that for the same reasons that the court held that the contracting-out grievance was not arbitrable under Section 1151, Section 1151 could not serve as a basis for requiring arbitration of the post-reduction claim. Accordingly, the court reversed the district court's grant of the Union's motion for summary judgment with regard to the contracting-out grievance, affirmed the district court's denial of the Union's motion for summary judgment with regard to the post-reduction grievance, and reversed the district court's denial of ExxonMobil's motion for summary judgment. View "Paper, Allied-Industrial Chemical and Energy Workers Int'l Union v. Exxon Mobil Corp." on Justia Law

After Roger Hudspeth's employment with the Bank of the Commonwealth was terminated, Hudspeth filed a complaint against the Bank, alleging the Bank failed to pay him compensation owed for his employment. The Bank filed a motion to stay and compel arbitration before the Financial Industry Regulatory Authority (FINRA), arguing (1) the Bank was a "customer" as defined by the FINRA Code of Arbitration Procedure for Customer Disputes (Customer Code), (2) Hudspeth was an associated person of a "member," and (3) because the dispute was between a customer and an associated person of a member, arbitration was mandatory under the Customer Code. The circuit court denied the Bank's motion, concluding that the Bank was not a customer under the Customer Code. The Supreme Court reversed, holding (1) the Customer Code was susceptible to an interpretation under which the Bank could be considered a customer, and (2) because under the Federal Arbitration Act any doubts concerning the scope of arbitrable issues should be resolved in favor of arbitration, the circuit court erred when it denied the Bank's motion in this case. Remanded. View "Bank of the Commonwealth v. Hudspeth" on Justia Law

Sammy Thomas and Pam Thomas appealed the Blount Circuit Court's order granting a motion to compel arbitration filed by Sloan Homes, LLC ("Sloan Homes"), David Sloan, and Teresa Sloan in the Thomases' action alleging breach of contract and tortious conduct in relation to the construction of a house by Sloan Homes, the grantor under the residential sales agreement. The question presented by this appeal was whether, under the doctrine of merger, the execution and delivery of the deed in this case nullified an arbitration clause included in the antecedent residential sales agreement. Upon review, the Supreme Court found that the arbitration clause was still valid, thereby affirming the circuit court's order granting Sloan Homes and the Sloans' motion to compel arbitration of the Thomases' claims. View "Thomas v. Sloan Homes, LLC" on Justia Law

Plaintiffs, John and Colm Farrell, were allegedly involved in a motor vehicle accident with an insured of Defendant, Twenty-First Century Insurance Company. Plaintiffs filed an action against Defendant, seeking damages for personal injuries arising out of the accident. During a pretrial conference, the parties agreed to settle Plaintiffs' claims and, allegedly, further agreed to arbitrate Plaintiffs' claims. Subsequently, Plaintiffs filed an action against Defendant seeking a court order to compel arbitration. The trial court rendered summary judgment in favor of Defendant, concluding that there was no clear manifestation of an agreement to arbitrate. The appellate court affirmed. The Supreme Court affirmed the judgment of the appellate court, holding that, after drawing all inferences in favor of Plaintiffs, no genuine issue of material fact existed with regard to whether the parties had an enforceable agreement to arbitrate. View "Farrell v. Twenty-First Century Ins. Co." on Justia Law

Don Drennen Motor Co., Inc. ("Drennen"), an automobile dealership, appealed a Jefferson Circuit Court order requiring it to pay the costs of arbitration stemming from an action filed by one of Drennen's former employees, William B. McClung. Upon review, the Supreme Court found that the circuit court's decision "is due to be reversed insofar as it orders Drennen to pay the entire costs of arbitration." The arbitration agreement provided that the parties must "share equally the costs, fees and expenses incurred by arbitration." The Court remanded the case for further proceedings. View "Don Drennen Motor Co.,Inc. v. William B. McClung" on Justia Law