This article, published in JD Supra and authored by Hodgson Russ attorneys Peter Bradley, Michael Flanagan, Richard Kaiser, Ryan Murphy and Amy Walters, discusses the Ohio District Court’s recent decision in Hawkins v. Cintas Corps., No. 1:19-CV-1062, 2021 WL 274341, denying a motion to compel ERISA class action claims brought by two employees alleging the company breached “its fiduciary duties of loyalty and prudence by mismanaging and failing to investigate and select better cost options for the plan.” As the article explains, the court found the claims were brought on behalf of the plan, and thus fell outside the scope of the plaintiff’s employment agreements which provided for arbitration of disputes relating to “the rights and claims of Employee,” with no reference to the plan.

René Thorne and Stacey Cerrone of Jackson Lewis authored this article in The National Law Review discussing the Second Circuit’s recent decision in Cooper v. Ruane Cunniff & Goldfarb Inc., in which the appellate panel in a 2-1 decision reversed a lower court order compelling arbitration of an employee’s claims against the investment advisor of his employer’s profit-sharing plan. Although the plaintiff and his employer were parties to an agreement “to arbitrate all legal claims ‘relating to, his employment,” the Second Circuit held that plaintiff’s claims of breach of fiduciary duty against the investment advisor were not subject to the advisor’s motion to compel arbitration under equitable estoppel, because the claims did not “relate to” plaintiff’s employment. As the court explained, that the claims “turned ‘entirely’ on [defendant’s] investment decisions and had ‘no connection’ to [plaintiff’s] work performance, evaluations, treatment by supervisors, his compensation, or the condition of his workplace.”

Daniel E. Evans and Colleen M. Kwiatkowski of Gordon & Rees have authored this article, available at Lexology, discussing the Colorado Court of Appeals decision in Tuscany Custom Homes, LLC v. John B. Westover, et al., No. 2020CA1724, in which they explain that the court “held that post-mediation communications from a mediator memorializing the parties’ agreement reached during mediation (but not executed by the parties) and an unsigned settlement agreement formalizing those settlement terms were ‘mediation communications’ under Colorado’s dispute resolution statute … and thus inadmissible evidence of a settlement agreement.” The explain that the court’s decision “serves as a cautionary tale to those engaged in mediation that the extra effort to solidify the parties’ agreements before ending the day is the safest bet.”

This cautionary tale carries with it an additional gloss dating to a 2001 Connecticut decision in Sharon Motor Lodge, Inc. v. Tai, No. CV 98 0077828 S (Dec. 3, 2001), in which a trial court ordered the mediator to answer interrogatories as to whether and, if so, on what terms did parties reach a settlement agreement during the mediation.

The Tuscany Motor Homes and Sharon Motor Lodge decisions, collectively, suggest the importance of counsel for the parties–not the mediator–documenting settlement terms reached before the parties leave the mediation. Even if the term sheet needs to be further formalized into a full blown settlement agreement, the term sheet will substantially eliminate the risk of controversy. And, by the parties themselves–not the mediator–preparing and signing off on the document, it eliminates the risk that the mediator will be called to provide written or oral testimony as to what transpired.

Many of you know that, in addition to Positively Neutral, I for almost ten years have been the steward of Golf Dispute Resolution, a website/blog that “tracks the intersection of golf and law.”

I wanted to share this arbitration-related post discussing a recent California federal decision addressing parties’ dispute as to whether there was an agreement to arbitrate.

In McGuire v. 99 Cents Only Stores LLC, the California Court of Appeal has reversed a lower court’s decision finding that a company waived its right to arbitrate by participating in the litigation for fourteen months, holding that the company’s fear that, under applicable law, moving to compel the claim would trigger an obligation to defend a class action arbitration. However, as the court explained, the United States Supreme Court decision in Lamps Plus, Inc. v. Varela (2019) _ U.S. __, 139 S.Ct. 1407, 203 L.Ed.2d 636, issued during the McGuire litigation, “eliminated all risk that the arbitration agreement could be interpreted as a basis for classwide arbitration under the Federal Arbitration Act (FAA),” leading the McGuire defendant to invoke its contractual arbitration right.

According to the court, the company did not act unreasonably in initially foregoing the risk of class arbitration, and the delay and litigation efforts prior to the issuance of the U.S. Supreme Court’s Lamps Plus decision did not constitute sufficient prejudice to warrant the finding of a waiver of the company’s right to arbitrate.

The Ninth Circuit’s recent decision in DiCarlo v. MoneyLion, Inc. is the subject of this article by James Sigel of Morrison & Foerster, published in Mondaq, in which the court held “that an arbitration provision prohibiting the plaintiff from acting as a ‘private attorney general’ is enforceable because the provision does not entirely preclude the plaintiff from seeking injunctive relief on behalf of others.”

Kevin Leblang and Kelly Schreiber of Kramer Levin have this article in Mondaq, discussing the interplay between the Federal Arbitration Act and “Section 7515 of the New York Civil Practice Law and Rules (CPLR 7515), which invalidated pre-dispute agreements to arbitrate sexual harassment claims ‘except where inconsistent with federal law.'” Reviewing the cases addressing the issue since Section 7515’s 2018 enactment, including the recent decisions in Gilbert v. Indeed, No. 20-3826, 2021 WL 169111 (S.D.N.Y. Jan. 19, 2021) and Crawford v. Goldman Sachs Group, Inc., No. 159731/2020 (Sup. Ct. N.Y. Cnty. Feb. 23, 2021) NYSCEF No. 26, the authors note that “[t]he weight of authority clearly and correctly holds that CPLR 7515 is preempted by the FAA.”

The International Centre for Dispute Resolution® has issued this press release, announcing amendments to its International Arbitration and Mediation Rules. The amendments, summarized in the release, constitute the first revisions to the Arbitration Rules since 2014 and to the Mediation Rules since 2018.

Stanley Martin of Commonsense Construction Law LLC has this article, published by Lexology, discussing the decision by the Maryland Court of Special Appeals in Park Plus, Inc. v. Palisades of Towson, LLC, in which the court held that a demand for arbitration filed almost five years following the expiration of the warranty upon which the claim was predicated was not barred by Maryland’s three year statute of limitations. As Mr. Martin points out, the court expressed the view that “the expiration of a statutory limitations period does not render a demand for arbitration untimely—and, thus, the right to arbitration waived—unless the parties provide for this in their arbitration agreement.”

Alex Silverman of Carlton Fields offers this article, published in JD Supra, discussing the Tenth Circuit’s decision in Wicker v. Bayview Loan Services, LLC. Setting the stage, the court explained that, “[w]hen [defendants] failed to respond to Mr. Wicker’s ‘binding self-executing irrevocable [counteroffer],’ …which also contained scattered and incoherent mentions of arbitration, he proceeded to obtain a nearly $2 million arbitration award and then filed an application to confirm the award.” Agreeing with the lower court’s determination that “[b]ecause arbitration is a matter of contract, and because the theory underlying the arbitration agreement put forward by Mr. Wicker here is unknown to the law of contracts, the purported award is an obvious sham and there can be no valid action based thereon.” And, as Mr. Silverman notes in his article, “although Wicker was pro se, finding his appeal was frivolous, the Tenth Circuit granted the respondents’ motion for sanctions and ordered Wicker to pay double appellate costs.”