Federal Cases

• Eighth Circuit: Party May Assign Contract Even If Duty to Arbitrate is Sole Remaining Obligation
• Eighth Circuit Finds Jurisdiction to Consider Appeal of Order Granting Motion to Compel, Citing Separate Proceedings in Different Courts
• Ninth Circuit Rejects Challenge to Arbitration Award in Moving Dispute
• Court Upholds Workplace Dispute Resolution Program Calling for Use of "Facilitator"
• Buckeye Requires Arbitration of Rescission Challenge to Underlying Contract
• Court Upholds Class Waiver Based on Arbitration Agreement’s Preservation of Statutory Remedies and Provision for Attorney Fees
• After Losing a Motion to Dismiss on the Merits, Party Cannot Get Second Bite at the Apple in Arbitration
• Court Accommodates Hotel Franchisor’s Motion for Reconsideration, Holds Its Prior Resolution of Arbitrability Issues "Improper"
• South Carolina Federal District Court Remands Matter for Lack of Diversity, But Includes Dicta Upholding Class Waiver
• Washington Federal Court Rejects Employee’s Unconscionability Challenge to Clear and Conspicuous Arbitration Agreement

State Cases

• Voluntary Dismissal of Claims Deprives California Trial Court of Jurisdiction to Compel Arbitration
• Wrongful Death Settlements Reached in Mediation and Filed with Court Not Protected by Virginia’s Mediation Confidentiality Statute

Federal Cases

Eighth Circuit: Party May Assign Contract Even If Duty to Arbitrate is Sole Remaining Obligation
Koch v. Compucredit Corp., No. 07-1948, 2008 WL 4305903 (8th Cir. Sept. 23, 2008)
9/23/2008 12:00:00 AM

After determining that the validity of an assignment of a contract containing an arbitration agreement was a non-arbitrable matter properly before a court, the Eighth Circuit Court of Appeals held that a continuing obligation to arbitrate disputes arising out of a contract can serve as an assignable present interest even if there are no other remaining obligations under the contract.

In Koch v. Compucredit Corp., No. 07-1948, 2008 WL 4305903 (8th Cir. Sept. 23, 2008), Koch entered into a credit card contract with First Bank. She allegedly settled her debt on the account in 2003. In 2005, First Bank assigned all rights, title, and interest in Koch’s alleged debt to Compucredit. Despite the alleged settlement, Compucredit continued to send collection notices...   Full Story

Eighth Circuit Finds Jurisdiction to Consider Appeal of Order Granting Motion to Compel, Citing Separate Proceedings in Different Courts
3M Co. v. Amtex Security, Inc., No. 07-3519, 2008 WL 4205761 (8th Cir. Sept. 16, 2008)
9/16/2008 12:00:00 AM

When a motion to compel arbitration is brought in separate proceedings in a different court than a related action to stay litigation, the Eighth Circuit Court of Appeals has held that it possesses jurisdiction to consider an otherwise "interlocutory" appeal of a district court order granting a motion to compel arbitration.

In 3M Co. v. Amtex Security, Inc., No. 07-3519, 2008 WL 4205761 (8th Cir. Sept. 16, 2008), 3M and Amtex entered into service contracts, with one subcontract containing a broadly-worded arbitration agreement. After a dispute arose over the scope of Amtex’s duties, 3M terminated the contract. When 3M refused to reimburse Amtex for expenses allegedly incurred under the contract, Amtex brought a breach of contract suit against 3M in a Texas federal district court...   Full Story

Ninth Circuit Rejects Challenge to Arbitration Award in Moving Dispute
White v. Mayflower Transit, L.L.C., No. 07-55528, 2008 WL 4181600 (9th Cir. Sept. 12, 2008)
9/12/2008 12:00:00 AM

The Ninth Circuit Court of Appeals has rejected a dissatisfied moving company customer’s challenge to an arbitration award and has adopted the rule that claims for intentional infliction of emotional distress arising out of the same conduct as produced a property loss are preempted by the Carmack Amendment.

In White v. Mayflower Transit, L.L.C., No. 07-55528, 2008 WL 4181600 (9th Cir. Sept. 12, 2008), White contracted with Mayflower to move his belongings cross-country. The moving contract contained an arbitration agreement. White alleged that his property was damaged during the move and filed a demand for arbitration. The arbitrator issued an award in favor of Mayflower...  Full Story

Court Upholds Workplace Dispute Resolution Program Calling for Use of "Facilitator"
Lambert v. Austin, No. 07-10651, 2008 WL 4481444 (11th Cir. Oct. 7, 2008)
10/7/2008 12:00:00 AM

In reversing a district court’s denial of a motion to compel arbitration, the Eleventh Circuit Court of Appeals held that a construction company’s promise to arbitrate workplace disputes is not illusory where the dispute resolution program encourages employees to speak with a "facilitator" that is similar to an advisor, as opposed to a facilitator who acts as a gatekeeper of employee claims.

In Lambert v. Austin, No. 07-10651, 2008 WL 4481444 (11th Cir. Oct. 7, 2008), Austin Maintenance & Construction, Inc. (Austin) adopted "Open Door," a company-wide workplace dispute resolution program. Open Door was a three-tiered process involving a conference with a supervisor, then mediation, and, as a last resort, arbitration. The Open Door policy stated that employees "may" and "should" contact the "facilitator," who would provide the employee with assistance and advice in the Open Door program...  Full Story

Buckeye Requires Arbitration of Rescission Challenge to Underlying Contract
DePaoli v. Exotic Motorcars & Jewelry, Inc., No. 08-80544-CIV, 2008 WL 4279645 (S.D. Fla. Sept. 16, 2008)
9/16/2008 12:00:00 AM

A Florida federal district court held that challenges to enforcement of a contract based on rescission do not raise a question as to the contract’s existence and, as such, must be resolved by the arbitrator under Buckeye Check Cashing, Inc. v. Cardegna.

In DePaoli v. Exotic Motorcars & Jewelry, Inc., No. 08-80544-CIV, 2008 WL 4279645 (S.D. Fla. Sept. 16, 2008), DePaoli sued Exotic, alleging breach of contract from improper delivery of an automobile. Exotic asserted that the transaction was subject to a retail buyer’s contract that contained an arbitration agreement. Accordingly, Exotic moved to compel arbitration of DePaoli’s claims. DePaoli argued that no agreement existed because the retail buyer’s contract was rescinded after delivery was rejected...  Full Story

Court Upholds Class Waiver Based on Arbitration Agreement’s Preservation of Statutory Remedies and Provision for Attorney Fees
Cruz v. Cingular Wireless, LLC, No. 2:07-CV-714-FTM-29DNF, 2008 WL 4279690 (M.D. Fla. Sept. 15, 2008)
9/15/2008 12:00:00 AM

A federal district court in Florida has upheld a class action waiver in a wireless contract’s arbitration agreement, observing that the agreement preserved all statutory remedies and did not require the plaintiff to bear unreasonable fees and costs.

In Cruz v. Cingular Wireless, LLC, No. 2:07-CV-714-FTM-29DNF, 2008 WL 4279690 (M.D. Fla. Sept. 15, 2008), Cruz filed a putative class action lawsuit against Cingular, alleging fraudulent charges in violation of the Florida Deceptive and Unfair Trade Practices Act (FDUTPA). Cingular moved to compel arbitration of the Cruz plaintiff’s individual claims. In opposing the motion, Cruz argued that enforcing the class waiver would violate public policy by hindering the purposes of the FDUTPA...  Full Story

After Losing a Motion to Dismiss on the Merits, Party Cannot Get Second Bite at the Apple in Arbitration
Hooper v. Advance America, No. 2:08-cv-04045-NKL, 2008 WL 4371360 (W.D. Mo. Sept. 22, 2008)
9/22/2008 12:00:00 AM

In denying a payday loan company’s motion to compel arbitration, a Missouri federal court held that where a party fully briefs its motion to dismiss a complaint on the merits in court, that party waives its right to arbitration even if the party attempts to reserve its right to arbitration in its motion to dismiss.

In Hooper v. Advance America, No. 2:08-cv-04045-NKL, 2008 WL 4371360 (W.D. Mo. Sept. 22, 2008), Hooper brought a putative class action against Advance America (Advance) challenging the legality of Advance’s payday loans. Each loan contract contained an arbitration agreement...   Full Story

Court Accommodates Hotel Franchisor’s Motion for Reconsideration, Holds Its Prior Resolution of Arbitrability Issues "Improper"
Bapu Corp. v. Choice Hotels Intern., Inc., NO. 07-CV-5938(WJM), 2008 WL 4192056 (D. N.J. Sept. 8, 2008)
9/8/2008 12:00:00 AM

In a dramatic about face, a New Jersey federal district court has reconsidered and granted a hotel franchisor’s motion to confirm, citing the parties'adoption of AAA rules in their agreement as evidence that arbitrability questions were reserved for the arbitrator.

In Bapu Corp. v. Choice Hotels Intern., Inc., NO. 07-CV-5938(WJM), 2008 WL 4192056 (D. N.J. Sept. 8, 2008), Bapu and its president Patel entered into a franchise contract with Choice. The contract required that Bapu make certain renovations to its property to comply with the terms of the contract. The contract also contained an arbitration agreement and a three-year contractual limitation on bringing arbitrable claims...  Full Story

South Carolina Federal District Court Remands Matter for Lack of Diversity, But Includes Dicta Upholding Class Waiver
Smalls v. Advance America, Civ. A. No. 2:07-3240-TLW-TER, 2008 WL 4177297 (D. S.C. Sept. 5, 2008)
9/5/2008 12:00:00 AM

Remanding a putative class action payday loan dispute to state court due to a lack of complete diversity, a South Carolina federal district court nonetheless determined in dicta that the parties'arbitration agreement and class action waiver were valid and enforceable.

In Smalls v. Advance America, Civ. A. No. 2:07-3240-TLW-TER, 2008 WL 4177297 (D. S.C. Sept. 5, 2008), Smalls filed a putative class action against payday loan company Advance in state court. After Advance removed the matter to federal court, Smalls moved to have the matter remanded, alleging that the parties to the suit were not completely diverse...   Full Story

Washington Federal Court Rejects Employee’s Unconscionability Challenge to Clear and Conspicuous Arbitration Agreement
Huang v. Washington Mutual Bank, No. C07-0736RSM, 2008 WL 4103918 (W.D. Wash. Aug. 25, 2008)
8/25/2008 12:00:00 AM

A federal district court in Washington has rejected a former employee’s unconscionability challenge, noting the arbitration agreement at issue was clear, conspicuous, and preserved the parties'statutory remedies.

In Huang v. Washington Mutual Bank, No. C07-0736RSM, 2008 WL 4103918 (W.D. Wash. Aug. 25, 2008), Huang applied for a job with Washington Mutual Bank (WaMu). The application contained an agreement to abide by all employment policies upon hiring and included a notice that an arbitration agreement was required as a condition of employment. One week later, WaMu sent an offer of employment and separate arbitration agreement to Huang, which he signed and accepted. After some confusion arose with Huang’s work visa, Huang executed these documents a second time one month later...   Full Story

State Cases

Voluntary Dismissal of Claims Deprives California Trial Court of Jurisdiction to Compel Arbitration
Cardiff Equities, Inc. v. Superior Court, No. B205882, 2008 WL 4308409 (Cal. Ct. App. Sept. 23, 2008)
9/23/2008 12:00:00 AM

A California appellate court has held that a plaintiff’s voluntary dismissal of claims compelled to arbitration deprives a trial court of jurisdiction to order those claims to arbitration, even if the plaintiff subsequently raises the same non-arbitrable claims in a second suit.

In Cardiff Equities, Inc. v. Superior Court, No. B205882, 2008 WL 4308409 (Cal. Ct. App. Sept. 23, 2008), Cardiff and O’Neel entered into two contracts: (1) a real estate contract that included an arbitration agreement and (2) a guaranty contract that did not. A dispute arose between the parties. When Cardiff sued O’Neel under both contracts, O’Neel moved to compel arbitration and stay proceedings. The trial court granted the motion, noting that the "gravamen" of Cardiff’s claims concerned the real estate contract containing the arbitration agreement...  Full Story

Wrongful Death Settlements Reached in Mediation and Filed with Court Not Protected by Virginia’s Mediation Confidentiality Statute
Perreault v. The Free Lance-Star, No. 071978, 2008 WL 4182425 (Va. Sept. 12, 2008)
9/12/2008 12:00:00 AM

According to the Virginia Supreme Court, wrongful death settlements reached during mediation are public records subject to disclosure once filed with the court as required by Virginia law. Accordingly, the settlements are not protected by Virginia’s mediation confidentiality statute.

In Perreault v. The Free Lance-Star, No. 071978, 2008 WL 4182425 (Va. Sept. 12, 2008), a group of estate administrators brought a wrongful death suit against pharmaceutical company CAPS (collectively, the settlement parties). The parties proceeded to mediation, reached a confidential settlement agreement, and petitioned the trial court for settlement approval as required by law. Va. Code § 8.01-55 (the settlement statute). The settlement parties submitted redacted versions of the agreements which did not include the financial terms of the settlements...  Full Story

ADR Legislation & Regulation

© 2008 National Arbitration Forum - www.adrforum.com - Unsubscribe