Justia U.S. 4th Circuit Court of Appeals Opinion SummariesArticles Posted in Arbitration & Mediation
Del Webb Communities, Inc. v. Carlson
This appeal stems from Roger and Mary Jo Carlson's attempt to arbitrate class action claims against Pulte under a sales agreement that contained an arbitration clause, and Pulte's efforts to limit arbitration to the claims between the three parties. Because the primary goal in enforcing an arbitration agreement is to discern and honor party intent, and because of the fundamental differences between bilateral and class arbitration - which change the nature of arbitration altogether - the court held that whether parties agree to class arbitration is a gateway question for the court. In this case, the parties did not unmistakably provide that the arbitrator would decide whether their agreement authorizes class arbitration. In fact, the sales agreement says nothing at all about the subject. Therefore, the district court erred in concluding that the question was a procedural one for the arbitrator. Accordingly, the court reversed the order denying Pulte's motion for partial summary judgment, vacated the judgment dismissing the petition, and remanded for further proceedings. View "Del Webb Communities, Inc. v. Carlson" on Justia Law
Peabody Holding Co. v. United Mine Workers of America
This case arose out of a 2007 Memorandum of Understanding Regarding Job Opportunities (the Jobs MOU) signed by the Union and Peabody as part of a wider collective bargaining agreement. At issue on appeal is when and under what circumstances should the court review a labor arbitrator's decision. The court held that judicial involvement in the labor dispute in this case was premature where, under the complete arbitration rule, the arbitrator should have been given the opportunity to resolve both the liability and remedial phases of the dispute between the companies and the Union before it moved to federal court. Accordingly, the court vacated the district court's order confirming the arbitrator's decision on the merits and directed that court to return the dispute to the arbitrator to allow him to rule on the remedial issues and otherwise complete the arbitration task. View "Peabody Holding Co. v. United Mine Workers of America" on Justia Law
Hayes v. Delbert Services Corp.
Plaintiff filed a putative class action against Delbert alleging that Delbert violated debt collection practices. The district court granted Delbert's motion to compel arbitration under the Federal Arbitration Act (FAA), 9 U.S.C. 4. The court concluded, however, that the arbitration agreement in this case is unenforceable where it purportedly fashions a system of alternative dispute resolution while simultaneously rendering that system all but impotent through a categorical rejection of the requirements of state and federal law. The court went on to conclude that the FAA does not protect the sort of arbitration agreement that unambiguously forbids an arbitrator from even applying the applicable law. Accordingly, the court reversed and remanded for further proceedings. View "Hayes v. Delbert Services Corp." on Justia Law
Chorley Enter. v. Dickey’s Barbecue Restaurants
This appeal stems from a franchise dispute between Dickey's and several of its franchisees in Maryland. At issue was whether the parties’ claims should be arbitrated, as Dickey’s argues, or heard in federal court in Maryland, as the franchisees contend. The court concluded that the clear and unambiguous language of the provisions in the parties' franchise agreement requires that the common law claims asserted by Dickey’s must proceed in arbitration, while the franchisees’ Maryland Franchise Law claims must proceed in the Maryland district court. Accordingly, the court reversed the district court's judgment and instructed the district court to compel arbitration of the common law claims only. The court left it to the district court’s discretion whether to stay the franchisees’ Maryland Franchise Law claims pending conclusion of the arbitration. View "Chorley Enter. v. Dickey's Barbecue Restaurants" on Justia Law
Jones v. Dancel
The parties’ dispute involved various “credit repair” services provided to plaintiff consumers, for which some of the disclosure requirements of the Credit Repair Organizations Act (CROA, or the Act), 15 U.S.C. 1679 et seq., were not met. At issue was the district court's denial of a motion to vacate certain aspects of an arbitration award. The court held that the arbitrator did not manifestly disregard the law by determining that plaintiffs failed to prove actual damages under the Act; the court rejected plaintiffs’ various arguments regarding their request for additional attorneys’ fees and costs; and the arbitrator did not exceed the scope of his contractually delegated authority under section 10(a)(4) of the Federal Arbitration Act (FAA), 9 U.S.C. 1 et seq. Accordingly, the court affirmed the judgment. View "Jones v. Dancel" on Justia Law
Dillon v. BMO Harris Bank, N.A.
Plaintiff filed suit against the Banks for facilitating collection of loans he obtained from online lenders. On appeal, the Banks challenged the district court's order denying their renewed motions seeking to cure deficiencies the district court relied on in dismissing their claims to enforce arbitration clauses in the loan agreements. The court concluded that the district court erred by treating as motions for reconsideration what were, in both form and substance, renewed motions to compel arbitration and stay further court proceedings. Accordingly, the court vacated the district court's order and remanded for further proceedings. View "Dillon v. BMO Harris Bank, N.A." on Justia Law
Local Union 557 Pension Fund v. Penske Logistics LLC
A multiemployer pension plan (the “Pension Fund”) commenced this action under 29 U.S.C. 1401(b)(2) by filing a complaint seeking to vacate or modify an arbitration order entered pursuant to section 1401(a)(1). The Pension Fund later filed an amended complaint that it argued related back to the filing date of the original complaint. The district court concluded that the Pension Fund could challenge the arbitration award only by filing a motion to vacate or modify, as provided in the Federal Arbitration Act. The court then treated the amended complaint as a motion and dismissed it, concluding that it was untimely under section 1401(a)(2) because a motion cannot “relate back” under Fed. R. Civ. P. 15. The Fourth Circuit reversed the district court’s order of dismissal and remanded for further proceedings as a civil action, holding (1) a party seeking to vacate or modify an arbitrator’s award under section 1401(b)(2) must commence an action in a district court by filing a complaint; and (2) the amended complaint in this case related back to the filing date of the original complaint, thus rendering it timely. View "Local Union 557 Pension Fund v. Penske Logistics LLC" on Justia Law
Moses v. CashCall, Inc.
Oteria Moses borrowed $1,000 under a loan agreement that was illegal under North Carolina law. When Moses filed for Chapter 13 bankruptcy protection, CashCall, Inc., the loan servicer, filed a proof of claim. Moses subsequently filed an adversary proceeding against CashCall seeking a declaration that the loan was illegal and also seeking money damages for CashCall’s allegedly illegal debt collection activities. CashCall filed a motion to compel arbitration. The bankruptcy court denied CashCall’s motion to compel arbitration and retained jurisdiction over both Moses’ first claim for declaratory relief and second claim for damages. On appeal, the district court affirmed. The Fourth Circuit affirmed in part and reversed in part, holding that the district court (1) did not err in affirming the bankruptcy court’s exercise of jurisdiction to retain in bankruptcy Moses’ first claim; but (2) erred in retaining in bankruptcy Moses’ claim for damages and denying CashCall’s motion to compel arbitration of that claim, as this claim was not constitutionally core. Remanded with instruction to grant CashCall’s motion to compel arbitration on Moses’ second claim for damages. View "Moses v. CashCall, Inc." on Justia Law
Fraternal Order of Police v. Washington Metro. Area Transit Auth.
The Washington Metropolitan Area Transit Authority (WMATA) operates the Metrorail and Metrobus systems in Washington, D.C., Maryland, and Virginia and employs a police force, the Metro Transit Police Department (MTPD). The Fraternal Order of Police (FOP) is the bargaining agent for MTPD officers. WMATA fired two MTPD officers, but the Board of Arbitration overturned both discharges and ordered WMATA to reinstate the officers. WMATA reinstated the officers, but as a result of their initial terminations, the officers lost the certifications to serve as police officers in Maryland. Consequently, WMATA discharged the officers for a second time. The FOP filed this action in federal court on behalf of each officer, alleging that WMATA failed to comply with the arbitration awards. The district court granted summary judgment for the FOP. The Fourth Circuit reversed, holding (1) WMATA’s decision to terminate the officers for a second time did not violate the earlier arbitration awards; and (2) the officers’ grievances belonged before the Board of Arbitration, not a federal court. View "Fraternal Order of Police v. Washington Metro. Area Transit Auth." on Justia Law
Santoro v. Accenture Federal Services, LLC
Plaintiff filed suit in the Superior Court for the District of Columbia against his former employer, Accenture, alleging claims for age discrimination. Accenture moved to compel arbitration. While the motion to compel arbitration was pending with the Superior Court, plaintiff received a right-to-sue letter from the EEOC and filed an action in district court. Accenture moved to compel arbitration of these claims as well. On appeal, plaintiff contended that the district court erred in compelling arbitration. The court held that, where the plaintiff is not pursuing Dodd-Frank whistleblower claims, neither 7 U.S.C. 26(n)(2), nor 18 U.S.C. 1514A(e)(2) overrides the FAA's mandate that arbitration agreements are enforceable. Because plaintiff was not pursuing a "dispute under this section" Dodd-Frank did not bar arbitration of his federal claims. Accordingly, the court affirmed the judgment of the district court.View "Santoro v. Accenture Federal Services, LLC" on Justia Law