Ninth Circuit: Court Decides Threshold Arbitration Issue Absent Clear And Unmistakable Evidence

Julia Farrell and Kaytlin Kopen of Husch Blackwell LLP have authored this article in JD Supra, discussing the Ninth Circuit’s recent decision in SEIU Local 121RN v. Los Robles Regional Medical Center, in which the court held “that the power to decide whether a grievance is arbitrable in labor cases resides with the federal court and not the arbitrator absent “clear and unmistakable” evidence to the contrary.” The article explains that this decision overrules prior Ninth Circuit precedent in order to comply with the United States Supreme Court decision in Granite Rock Co. v. Int’l Bhd. of Teamsters

Arbitrator’s Authority Does Not Extend To Post-Arbitration Conduct

In Kelly v. Charles Schwab & Co., Inc., the California Court of Appeal affirmed an arbitration award rendered against a former Schwab investment advisor, with respect to the claims he brought against the brokerage. However, according to the court, the arbitrator went too far when he included in his award a $300 daily sanction intended to encourage the advisor to remove from YouTube videos that he had obtained from the brokerage in discovery. As the court noted, “the Legislature did not give arbitrators the authority to provide for enforcement of judgments.”

Postmates Cannot Avoid Arbitration Of Class Action Claims

The Ninth Circuit has rejected Postmates’ request for a determination that the arbitrability of class action claims against it must be determined by the court, not an arbitrator.

The agreement at issue specified for an arbitrator to determine arbitrability, except that “any claim that the Class Action Waiver is ‘unenforceable, unconscionable, void, or voidable shall be determined only by a court of competent jurisdiction and not by an arbitrator.’” Because the dispute did not fall into that narrow exception, the court held “that an arbitrator must decide whether petitioners have violated the Class Action Waiver.”

Bloomberg Law‘s take on the decision can be found here.

Lower Court Erred By Not Determining Whether There Was An Agreement To Arbitrate

The Fifth Circuit, in Allen v. Vaksman Law Offices, P.C., summarily reversed the U.S. District Court for denying a law firm’s motion to compel arbitration of a former client’s claims. The lower court’s denial of arbitration was solely predicated on, as the appellate court described it, a finding “only that [plaintiff] Allen plausibly denied the existence of a valid arbitration agreement.”

Subtly reminding the lower court of its obligation on remand, the appellate panel noted “[t]here is no reason to doubt that the district court will, as [defendant] Vaksman requests, hold ‘an evidentiary hearing and [make] a factual finding based on the preponderance of the evidence as to whether there exists a valid and binding arbitration agreement between the parties.'”

“New Jersey Supreme Court Plugs Two Arbitration Agreement Holes, Giving Boost to Employers”

The recent New Jersey Supreme Court decisions in Skuse v. Pfizer, Inc. and Flanzman v. Jenny Craig, Inc., are the subject of this article in The National Law Review by Sills Cummis & Gross attorneys David Rosen and Jill Turner Lever.

“7 Barrett Employment Rulings That Lawyers Should Know”

Vin Gurrieri at Law360 has authored this article, discussing decisions–including arbitration decisions–in which Amy Coney Barrett has participated while on the Seventh Circuit.

Arbitration Agreement Between Staffing Company And Employee Did Not Encompass Claims Brought Against The Client To Whom The Employee Was Assigned

In Zachariah v. Rep Processing, LLC d/b/a Rimrock Energy Partners, the Colorado U.S. District Court refused to compel arbitration of FLSA claims brought by an employee of a staffing company (Kestrel) against the client to whom he had been assigned.

The client sought to assert rights as a third party beneficiary of an arbitration agreement between the employee and Kestrel, but the court–before reaching the third party beneficiary claim–found that the dispute fell outside the scope of the arbitration agreement, which, as the court explained, provided for arbitration of ““all past, present, and future claims or controversies, including, but not limited to, claims arising out of or related to [plaintiff’s] application for employment, employment, or termination of [plaintiff’s] employment that [Kestrel] may have against [plaintiff] or [plaintiff] may have against: (i) [Kestrel] or its subsidiaries or affiliated entities (“Kestrel Entities”); (ii) Kestrel Entities officers, directors, employees, or agents in their capacity as such or otherwise, (iii) Kestrel Entities’ benefit plans or the plans’ sponsors, fiduciaries, administrators, affiliates, and agents, and/or (iii) all of their successors and assigns.”

According to the court, this language, while broad, did not encompass claims between the employee and Kestrel’s clients.

“Who Decides Who Decides? The Third Circuit Addresses the ‘Queen of All Threshold Issues’ in Arbitration Law”

This article by Thomas F. Howley and Robert T. Szyba of Seyfarth Shaw LLP, published in Lexology, begins:

“Who decides the case: a court or an arbitrator? It’s a simple question at the core of any arbitration dispute. Then there’s the question of who decides who decides the case? Typically, the parties decide—they can decide to let an arbitrator decide the case (rather than a court) by entering into a binding arbitration agreement.”

The article discusses the Third Circuit’s decision in MZM Constr. Co. v. N.J. Bldg. Laborers Statewide Benefit Funds, which tackles this issue.

“Court Affirms FINRA Arbitration Award to Charles Schwab, Finding No Evident Partiality or Other Arbitrator Misconduct”

JD Supra has published this article by Benjamin Stearns of Carlton Fields, discussing the U.S. District Court in Nevada’s decision in Sanduski v. Charles Schwab & Co, Inc.

“Employee Arbitration Award Stands Despite Arbitrators’ Alleged Misinterpretation of the Contract”

The Eleventh Circuit’s decision in Gherardi v. Citigroup Global Markets Inc. is the subject of this Lexology article by Kamryn Deegan of Eversheds Sutherland.