Justia Arbitration & Mediation Opinion Summaries

Three plaintiffs began working for Wise on separate dates. Each purportedly signed an arbitration agreement, “governed by the Federal Arbitration Act and the California Arbitration Act. It bans class arbitration and waives the employees’ right to join class litigation, noting that the employee “may wish to consult with an attorney.” An acknowledgment indicates that the employee has read the agreement and understands that he can choose not to sign and still be employed by Wise, without retaliation. Wise fired the plaintiffs. They filed a joint complaint.Wise moved to compel each plaintiff to submit to individual arbitration. Wise submitted a declaration from its HR director, authenticating the documents, bearing the handwritten signature of each plaintiff. Each plaintiff alleged that, on his first day of work, he was handed a stack of documents and was not given any time to review them nor given a copy of the documents, adding “I do not recall ever reading or signing any" Binding Arbitration Agreement ... I do not know how my signature was placed on [either document].”The trial court ruled in favor of the plaintiffs. The court of appeal reversed. The plaintiffs offered no admissible evidence creating a dispute as to the authenticity of their physical signatures and did not prove that the agreement was unconscionable. The FAA does not prescribe substantive rules of law for resolving disputes. It does not displace the substantive law of California. View "Iyere v. Wise Auto Group" on Justia Law

Smarter Tools Inc. (“STI”) appeals the district court’s judgment denying STI’s petition to vacate an arbitral award and granting Chongqing SENCI Import & Export Trade Co., Ltd.’s and Chongqing AM Pride Power & Machinery Co. Ltd.’s (collectively, “SENCI”) cross-petition to confirm that award. The district court agreed with STI that the arbitrator exceeded his authority by failing to provide a reasoned award as requested by the parties. The district court remanded to allow the arbitrator to issue a reasoned award. On remand, the arbitrator issued a final amended award, which STI again challenged in district court on the grounds that the award was not reasoned and that it reflected a manifest disregard of the law, and which SENCI again cross-petitioned to confirm. The district court denied STI’s petition to vacate the award and granted SENCI’s cross-petition to confirm the award.   STI’s primary argument on appeal is that the district court erred in remanding for the arbitrator to issue a reasoned award, in contravention of the doctrine of functus officio and the Federal Arbitration Act. Absent a finding of ambiguity, or a minor clerical error, STI argues, once the district court determined that the arbitrator exceeded its authority by failing to issue a  reasoned award, the only remedy available was vacatur.   The Second Circuit affirmed. The court explained that the original award was found not to provide the reasoned award the parties bargained for; in its amended award, the arbitrator clarified the original award by including a rationale for rejecting STI’s counterclaims; and this clarification is consistent with the parties’ intent that the arbitrator issue a reasoned award. View "Smarter Tools Inc. v. Chongqing Senci Import & Export Trade Co., Ltd." on Justia Law

Bachman Farms grows apples in Ohio and protected its 2017 crop with federally reinsured crop insurance from Producers Agriculture. When farmers and private insurers enter a federally reinsured crop insurance contract, they agree to common terms set by the Federal Crop Insurance Corporation (FCIC), including a requirement that the parties arbitrate coverage disputes. In those proceedings, the arbitrator must defer to agency interpretations of the common policy. Failure to do so results in the nullification of the arbitration award. Bachman lost at its arbitration with Producers Agriculture and alleged that the arbitrator engaged in impermissible policy interpretation. Bachman petitioned to nullify the arbitration award.The Sixth Circuit affirmed the dismissal of the suit. The petition to nullify did not comply with the substance or the three-month time limit of the Federal Arbitration Act (FAA), 9 U.S.C. 12. When a dispute concerning federally reinsured crop insurance involves a policy or procedure interpretation, the parties “must obtain an interpretation from FCIC.” Bachman did not seek an interpretation from FCIC but went directly to federal court to seek nullification under the common policy and its accompanying regulations—an administrative remedy—rather than vacatur under the FAA. View "Bachman Sunny Hill Fruit Farms v. Producers Agriculture Insurance Co." on Justia Law

Plaintiff purchased a set of tires from Walmart.com, which included a Terms of Use with an arbitration provision. Plaintiff had the tires shipped to and installed at a Walmart Auto Center, and while waiting for the tires to be installed, he purchased the lifetime balancing and rotation Service Agreement. Plaintiff received tire services once in 2019 but was later denied service on several occasions in 2020 at multiple Walmart Auto Centers. Plaintiff brought a putative class action alleging breach of contract and breach of the duty of good faith and fair dealing. Walmart sought to compel individual arbitration of its dispute with Plaintiff pursuant to the arbitration provisions of the Terms of Use. The district court found that the plain meaning of the Terms of Use precluded the applicability of the arbitration provision to in-store purchases.   The Ninth Circuit affirmed the district court’s denial of Walmart Inc.’s motion to compel arbitration and agreed with the district court that Plaintiff contested the existence, not the scope, of an arbitration agreement that would encompass this dispute. As the party seeking to compel arbitration, Walmart bore the burden of proving the existence of an agreement to arbitrate by a preponderance of the evidence. The panel held that substantial evidence supported that the two contracts between Plaintiff and Walmart were separate, independent agreements. The two contracts—though they involved the same parties and the same tires—were separate and not interrelated. Therefore, the arbitration agreement in the first did not encompass disputes arising from the second. View "KEVIN JOHNSON V. WALMART INC." on Justia Law

The Supreme Court vacated the judgment of the circuit court confirming M.O.'s arbitration award in this personal injury action, holding that the circuit court erred in confirming the arbitration award because GEICO General Insurance Company was statutorily entitled to intervene in the pending lawsuit between M.O. and M.B. pursuant to Mo. Rev. Stat. 537.065.2.M.O. sued M.B. alleging that she had contracted HPV from M.B. while having sexual relations in M.B.'s vehicle, which was insured by GEICO. had sexual relations in M.B.'s vehicle, which was insured by GEICO. M.B. and M.O., without informing GEICO, entered into an agreement providing that M.O.'s claims were be submitted to arbitration but that M.O. would seek recovery of any judgment from M.B.'s insurers. The arbitrator awarded M.O. $5.2 million. M.O. then sued M.B. without informing GEICO. After GEICO filed its motion to intervene the circuit court confirmed the arbitration award. Thereafter, the circuit court sustained GEICO's motion to intervene. The Supreme Court vacated the circuit court's judgment, holding that GEICO was statutorily entitled to intervene in the underlying lawsuit before judgment was entered. View "M.O. v. GEICO General Insurance Co." on Justia Law

A Bolivian arbitration tribunal awarded $36 million in damages to Compania de Inversiones Mercantiles S.A. (“CIMSA”) against Grupo Cementos de Chihuahua S.A.B. de C.V. (“GCC”). GCC fought the award in the Bolivian courts, losing before a chamber of Bolivia’s highest constitutional court in 2016. In 2019, CIMSA obtained an order from the U.S. District Court for the District of Colorado confirming the award. In 2020, GCC convinced a different chamber of Bolivia’s highest constitutional court to invalidate its prior decision, and a Bolivian trial judge subsequently annulled the award. GCC then moved the U.S. district court to vacate the confirmation order. The district court: (1) denied GCC’s motion; and (2) ordered GCC to turn over assets located in Mexico to satisfy the award. GCC brought separate appeals from these two rulings. GCC argued that the district court erred by refusing to vacate the Confirmation Judgment, contending the 2020 Bolivian court orders annulling the Damages Award required vacatur. The Tenth Circuit found when a court has been asked to vacate an order confirming an arbitral award that has later been annulled, it may balance against comity considerations (1) whether the annulment is repugnant to U.S. public policy or (2) whether giving effect to the annulment would undermine U.S. public policy. "Although the district court here may have found the 2020 Bolivian orders were not repugnant, it did not legally err by considering whether giving effect to those orders through vacatur of its Confirmation Judgment would offend U.S. public policy." Because the district court did not abuse its discretion by refusing to vacate its Confirmation Judgment, the Tenth Circuit affirmed. View "Compania De Inversiones v. Grupo Cementos de Chihuahua, et al." on Justia Law

Plaintiff Desert Regional Medical Center, Inc. (DRMC) appealed trial court orders denying DRMC’s first amended petitions to compel nurses Leah Miller, Lynn Fontana, and Renita Romero (Respondents) to arbitrate their labor claims alleging rest and meal break violations by DRMC. DRMC contended the trial court erred by denying its petitions to compel arbitration and failing to stay Respondents’ individual claims until after completion of arbitration of a separate proceeding initiated by Respondents’ union (the California Nurses Association) on behalf of all nurses employed by DRMC in California. DRMC argued the trial court erred in denying DRMC’s petitions to compel arbitration based on a finding DRMC waived the right to arbitrate. DRMC argued the issue of waiver had to be determined by the arbitrator, not the trial court, and, even if the court has jurisdiction to decide waiver, there was insufficient evidence to support its finding of waiver. DRMC further contended Respondents were estopped from arguing waiver because Respondents’ Union was responsible for DRMC’s delay in petitioning to compel arbitration and agreed, in a separate proceeding, to arbitrate the Union’s group grievance. After review, the Court of Appeal rejected DRMC’s contentions and affirmed the order denying DRMC’s amended petitions to compel arbitration and request for a stay. View "Desert Regional Medical Center, Inc. v. Miller" on Justia Law

In this investment fund complex dispute brought by former partners causing two LLCs to file suit for breach of the LLC agreements after the fund principal commenced an arbitration the Court of Chancery held that, absent a further arbitration agreement, the parties must litigate the claims asserted in this action in the district court.The employment agreement of the fund principal contained a mandatory agreement to arbitrate all claims relating to his employment. The fund principal's partners eventually terminated him for cause for allegedly violating his employment agreement and, as a consequence, for canceling the fund principal's member interests in the LLC. Thereafter, the fund principal commenced an arbitration in which he sought to litigate whether he had breached his employment agreement. The former partners refused to arbitrate and then brought this suit seeking a permanent injunction barring the fund principal from arbitrating the breaches of the LLC agreements. The Court of Chancery held that the LLCs were bound by the arbitration agreement and that the court must decide which claims must be litigated and which claims were arbitrable. View "Fairstead Capital Management LLC v. Blodgett" on Justia Law

The plaintiffs first worked for Tesla through staffing agencies. When Tesla offered them employment, effective August 2, 2017, most of the plaintiffs electronically signed offer letters, including an arbitration provision, “any and all disputes, claims, or causes of action, in law or equity, arising from or relating to your employment, or the termination of your employment, will be resolved, to the fullest extent permitted by law by final, binding and confidential arbitration.” A complaint under the Fair Employment and Housing Act (FEHA) (Gov. Code 12900) alleged that the plaintiff and other Black workers “suffered severe and pervasive harassment.”The trial court partially granted Tesla's motion to compel arbitration, reasoning that the arbitration clauses required the plaintiffs to arbitrate disputes that arose on or after 8/2/17 while claims based on alleged wrongs before 8/2/17 are not within the scope of the agreements. The trial court denied the motion to the extent that the plaintiffs sought a public injunction. The court of appeal affirmed. The court properly declined to mandate arbitration of the request for a public injunction. Injunctions sought under FEHA may be considered “public injunctions.” The Federal Arbitration Act (9 U.S.C. 1), as interpreted by the Supreme Court in 2022 (Viking River) does not preempt the California rule prohibiting waiver of the right to seek such injunctions. View "Vaughn v. Tesla, Inc." on Justia Law

Appellant, his law firm, and Amberson Natural Resources (“ANR”) (collectively “Amberson”) moved for rehearing by the Fifth Circuit. Though successful in convincing a majority of the panel that it has authority to consider the argument that a claim was not arbitrable, Amberson then lost on the merits of that argument. Amberson alleged that the Fifth Circuit erred in three ways: (1) it should not have considered the arbitrator’s fact findings in deciding the validity of the state court’s compelling of arbitration; (2) the state court record does not support that all the claims were intertwined; and (3) the appellees’ state court pleadings do not support the court’s finding of alter ego.   The Fifth Circuit denied the petition for rehearing. The court explained that Amberson cites no Texas caselaw that the evidence to support the validity of interlocutory orders reviewed on appeal after a final judgment must come only from the part of the record that existed when the orders were entered. Moreover, Amberson’s briefing, though, did not meaningfully dispute the accuracy of the arbitrator’s fact-findings. The arbitrator’s opinion contained the best summary of the facts. Absent any argument that the findings were erroneous, acceptance of the summary was proper and undue deference was not given to the arbitrator as to fact-findings. View "In the Matter of: Jon Amberson" on Justia Law