Arbitration
Fifth Circuit Holds Insurer Not Required to Fund Wage and Hour Arbitrations Due to Lack of Timely Notice
September 15, 2019
A divided Fifth Circuit Court of Appeals has affirmed an Eastern District of Texas order stating an insurance company was not obligated to pay costs related to a staffing agency’s wage and hour arbitrations with numerous workers because the agency failed to provide the insurer with timely notice of the first claim. In ADI Worldlink, L.L.C. v. RSUI Indemnity Company, No. 17-41050 (5th Cir., August 2, 2019), a staffing company, Worldlink, procured a one-year directors and officers liability...
September 15, 2019
A divided Fifth Circuit Court of Appeals has affirmed an Eastern District of Texas order stating an insurance company was not obligated to pay costs related to a staffing agency’s wage and hour arbitrations with numerous workers because the agency failed to provide the insurer with timely notice of the first claim. In ADI Worldlink, L.L.C. v. RSUI Indemnity Company, No. 17-41050 (5th Cir., August 2, 2019), a staffing company, Worldlink, procured a one-year directors and officers liability...
Companies Cannot Impose Arbitration by Stealth
September 7, 2019
U.S. District Judge William Orrick (ND CA) has just held that companies must still provide online customers with adequate notice of arbitration and other provisions. This is so in at least the Ninth Circuit after Nguyen v. Barnes & Noble(763 F.3d 1171 (Ninth Cir. Ct. of App.)). As reported by Reuters, it’s become standard operating procedure for companies to require online or mobile customers to agree to mandatory arbitration by clicking their assent to terms of service. But there’s...
September 7, 2019
U.S. District Judge William Orrick (ND CA) has just held that companies must still provide online customers with adequate notice of arbitration and other provisions. This is so in at least the Ninth Circuit after Nguyen v. Barnes & Noble(763 F.3d 1171 (Ninth Cir. Ct. of App.)). As reported by Reuters, it’s become standard operating procedure for companies to require online or mobile customers to agree to mandatory arbitration by clicking their assent to terms of service. But there’s...
Still Seeking Injunctive Relief . . .
September 5, 2019
A long-litigated dispute about arbitrability reached its latest stage in Archer & White Sales, Inc. v. Henry Schein, Inc., on remand from the Supreme Court, in which the Fifth Circuit held: “The most natural reading of the arbitration clause at issue here states that any dispute, except actions seeking injunctive relief, shall be resolved in arbitration in accordance with the AAA rules. The plain language incorporates the AAA rules—and therefore delegates arbitrability—for all disputes...
September 5, 2019
A long-litigated dispute about arbitrability reached its latest stage in Archer & White Sales, Inc. v. Henry Schein, Inc., on remand from the Supreme Court, in which the Fifth Circuit held: “The most natural reading of the arbitration clause at issue here states that any dispute, except actions seeking injunctive relief, shall be resolved in arbitration in accordance with the AAA rules. The plain language incorporates the AAA rules—and therefore delegates arbitrability—for all disputes...
Fifth Circuit, on Remand from Supreme Court, Gives Guidance on Drafting Arbitration Clauses
September 4, 2019
Earlier this week, on remand from the Supreme Court, the Fifth Circuit issued its decision in Archer & White Sales, Inc. v. Henry Schein, Inc., No. 16-41674 (5th Cir. Aug. 14, 2019) (click here for a copy of the decision). The decision is a worthwhile read for anyone drafting a sophisticated arbitration clause, particularly if the arbitration clause contains carve-outs or exemptions. The Fifth Circuit issued a carefully-reasoned, thoughtful opinion exploring the language...
September 4, 2019
Earlier this week, on remand from the Supreme Court, the Fifth Circuit issued its decision in Archer & White Sales, Inc. v. Henry Schein, Inc., No. 16-41674 (5th Cir. Aug. 14, 2019) (click here for a copy of the decision). The decision is a worthwhile read for anyone drafting a sophisticated arbitration clause, particularly if the arbitration clause contains carve-outs or exemptions. The Fifth Circuit issued a carefully-reasoned, thoughtful opinion exploring the language...
Class Action Waivers Are Okay, But Waivers of Public Injunctive Relief Aren’t
August 23, 2019
All three cases address whether a rule articulated by the California Supreme Court in McGill v. Citibank, N.A., 2 Cal.5th 945, 216 Cal. Rptr. 3d 627, 393 P.3d 85 (2017), is preempted by the FAA. Spoiler alert: the Ninth Circuit says the McGill rule isn’t preempted. That’s sure to raise some eyebrows, including by SCOTUS justices. Deep breath! Let’s wade into this. In McGill, the California Supreme Court held that an agreement waving the right to seek...
August 23, 2019
All three cases address whether a rule articulated by the California Supreme Court in McGill v. Citibank, N.A., 2 Cal.5th 945, 216 Cal. Rptr. 3d 627, 393 P.3d 85 (2017), is preempted by the FAA. Spoiler alert: the Ninth Circuit says the McGill rule isn’t preempted. That’s sure to raise some eyebrows, including by SCOTUS justices. Deep breath! Let’s wade into this. In McGill, the California Supreme Court held that an agreement waving the right to seek...
New Clear and Unmistakable Outcome Exception to the Old Clear and Unmistakable Rule? (Part II)
August 22, 2019
Part I of this post discussed how the Second and Fifth Circuits, in Metropolitan Life Ins. Co. v. Bucsek, ___ F.3d ___, No. 17-881, slip op. (2d Cir. Mar. 22, 2019), and 20/20 Comms. Inc. v. Lennox Crawford, ___ F.3d ___, No. 18-10260 (5th Cir. July 22, 2019), suggest a trend toward what might (tongue-in-cheek) be called a “Clear and Unmistakable Outcome Exception” to the First Options Reverse Presumption of Arbitrability (a/k/a the “Clear and Unmistakable Rule”). Under...
August 22, 2019
Part I of this post discussed how the Second and Fifth Circuits, in Metropolitan Life Ins. Co. v. Bucsek, ___ F.3d ___, No. 17-881, slip op. (2d Cir. Mar. 22, 2019), and 20/20 Comms. Inc. v. Lennox Crawford, ___ F.3d ___, No. 18-10260 (5th Cir. July 22, 2019), suggest a trend toward what might (tongue-in-cheek) be called a “Clear and Unmistakable Outcome Exception” to the First Options Reverse Presumption of Arbitrability (a/k/a the “Clear and Unmistakable Rule”). Under...
New Clear and Unmistakable Outcome Exception to the Old Clear and Unmistakable Rule? (Part I)
August 21, 2019
Arbitration law is replete with presumptions and other rules that favor one outcome or another depending on whether one thing or another is or is not clear and unmistakable. Put differently, outcomes often turn on the presence or absence of contractual ambiguity. There are three presumptions that relate specifically to questions arbitrability, that is, whether or not an arbitrator or a court gets to decide a particular issue or dispute: The Moses Cone Presumption of Arbitrability:...
August 21, 2019
Arbitration law is replete with presumptions and other rules that favor one outcome or another depending on whether one thing or another is or is not clear and unmistakable. Put differently, outcomes often turn on the presence or absence of contractual ambiguity. There are three presumptions that relate specifically to questions arbitrability, that is, whether or not an arbitrator or a court gets to decide a particular issue or dispute: The Moses Cone Presumption of Arbitrability:...
Fifth Circuit Holds Class Arbitration is a Gateway Issue for the Courts to Decide
August 20, 2019
The United States Court of Appeals for the Fifth Circuit has issued an opinion holding the issue of class arbitration is a gateway matter for the courts to decide. In 20/20 Communications, Inc. v. Crawford, No. 18-10260 (5th Cir., July 22, 2019), a number of employees signed 20/20 Communication’s arbitration agreementas a condition of employment. The terms of the agreement required each employee to individually arbitrate any future claims against the company. Several...
August 20, 2019
The United States Court of Appeals for the Fifth Circuit has issued an opinion holding the issue of class arbitration is a gateway matter for the courts to decide. In 20/20 Communications, Inc. v. Crawford, No. 18-10260 (5th Cir., July 22, 2019), a number of employees signed 20/20 Communication’s arbitration agreementas a condition of employment. The terms of the agreement required each employee to individually arbitrate any future claims against the company. Several...
Fifth Circuit Withdraws Prior Opinion in Case Involving Arbitration
August 16, 2019
The United States Court of Appeals for the Fifth Circuit has withdrawn its earlier opinion following a second rehearing of a case involving arbitration. In Stemcor USA Inc. v. Cia Siderurgica do Para Cosipar, et al., No. 16-30984 (June 25, 2019), two foreign corporate creditors, Daewoo and Thyssenkrupp Mannex GMBH (“TKM”), sought to attach the same pig iron that was owned by America Metals Trading, LLP (“AMT”) after AMT apparently failed to comply with its separate contractual...
August 16, 2019
The United States Court of Appeals for the Fifth Circuit has withdrawn its earlier opinion following a second rehearing of a case involving arbitration. In Stemcor USA Inc. v. Cia Siderurgica do Para Cosipar, et al., No. 16-30984 (June 25, 2019), two foreign corporate creditors, Daewoo and Thyssenkrupp Mannex GMBH (“TKM”), sought to attach the same pig iron that was owned by America Metals Trading, LLP (“AMT”) after AMT apparently failed to comply with its separate contractual...
CMS Issues Final Rule Allowing Pre-Dispute Nursing Home Arbitration Agreements
August 15, 2019
The Centers for Medicare & Medicaid Services (“CMS”) has issued a final rule allowing the use of pre-dispute, binding arbitration agreements by nursing homes across the United States. The rule summary published in the Federal Register on July 18th states: This final rule amends the requirements that Long-Term Care (LTC) facilities must meet to participate in the Medicare and Medicaid programs. Specifically, we are repealing the prohibition...
August 15, 2019
The Centers for Medicare & Medicaid Services (“CMS”) has issued a final rule allowing the use of pre-dispute, binding arbitration agreements by nursing homes across the United States. The rule summary published in the Federal Register on July 18th states: This final rule amends the requirements that Long-Term Care (LTC) facilities must meet to participate in the Medicare and Medicaid programs. Specifically, we are repealing the prohibition...
