To follow up on our post of last week. We are pleased to recommend another excellent law review article, “Disappearing Juries and Jury Verdicts,” 39 Tex. Tech L. Rev. 289, written by the Honorable Sam Sparks, U.S. District Judge for the Western District of Texas and DLA Piper attorney George B. Butts. The article traces the history of jury trials, presents statistics reflecting the decline in the number of cases tried, and discusses Fifth Circuit and Texas Supreme Court cases relevant to the issue of the constitutional authority of the jury. As it relates to arbitration, the authors make the following remarks: IX. Compelling Arbitration One form of alternative dispute resolution that frequently supplants jury trials is compulsory arbitration. The Texas Supreme Court has recently decided two cases that evidence the court’s strong preference for arbitration over litigation. In re Weekley Homes, L.P. was a case of first impression in which the Texas Supreme Court conditionally granted an application for writ of mandamus to require a trial judge to compel arbitration. The unusual aspect of the case was that the person resisting arbitration was not a party to the contract containing the arbitration clause that was sought to be enforced. Rather, she was the adult daughter of the owner of the house which was the subject of litigation. She did not assert any claim under the contract between her father and the homebuilder or sue as either trustee or beneficiary. The court, however, justified its conclusion to compel arbitration under the direct-benefits estoppel theory because the plaintiff had taken advantage of the benefits of the contract and was in fact the equitable owner of the house. In re Dillard Department Stores, Inc. is another example of the Texas Supreme Court’s strong policy favoring arbitration. In Dillard, Garcia was discharged from her job as a sales associate at a Dillard’s store. She subsequently filed a retaliatory discharge suit. In response, Dillard’s filed an original mandamus proceeding in the Texas Supreme Court seeking to enforce an arbitration policy adopted by the company that it claimed covered most employment disputes, including Garcia’s. She claimed she had never agreed to an arbitration policy and had specifically refused to sign a form that required arbitration. Dillard’s was unable to produce any writing whereby Garcia acknowledged receipt of the arbitration policy. Despite that fact, the court concluded Garcia attended a meeting at which she received an acknowledgment form advising employees of Dillard’s arbitration policy. Ultimately, the supreme court concluded that both the trial court and the court of appeals abused their discretion by not granting Dillard’s motion to compel arbitration. The effect of the supreme court’s holding was that Garcia lost her Seventh Amendment right to a jury trial when she elected to continue her employment with Dillard’s after she received the arbitration acknowledgment. We would like to hear your comments about this article. Technorati Tags: arbitration, ADR, law

On April 1, 2009, the U.S. Supreme Court decided the landmark case 14 Penn Plaza v. Pyett (find our case summary here and additional comments here). Then, in May, a U.S. District Court in Colorado decided the first case post-Pyett (blogged here). Recently, we came across yet another Pyett progeny. This time, it was the U.S. District Court for the Eastern District of New York‘s turn in Shipkevich v. Staten Island Univ. Hosp. & Aramark, 2009 U.S. Dist. LEXIS 51011 (E.D.N.Y. June 16, 2009) to decide the “clearly and unmistakable” requirement. Check out New York attorney Philip J. Loree, Jr. excellent analysis of this opinion in: Shipkevich v. Staten Island Univ. Hosp., 14 Penn Plaza LLC v. Pyett, and the “Clear and Unmistakable” Rule. Also, following are Professor Mitchell H. Rubinstein’s comments: Shipkevich v. Staten Island Univ. Hosp. & Aramark, 2009 U.S. Dist. LEXIS 51011 (E.D.N.Y. June 16, 2009), is an interesting case. A lower court held that a CBA did not mandate arbitration of the plaintiff’s statutory anti-discrimination claims because the language of the CBA did not “clearly and unmistakably” require arbitration. The plaintiff alleged discrimination in violation of Title VII and related New York state laws. On its motion to dismiss, the defendant argued that the following arbitration provision in the CBA, which also prohibited discrimination, required arbitration of the plaintiff’s claims: “A grievance…which has not been resolved [under the grievance procedure] may…be referred for arbitration by the Employer or the Union[.]” The court reasoned that the CBA at issue was more like the CBA in Gardner-Denver than the one in Pyett: “Nowhere in the CBA is there an explicit statement that such claims are subject to mandatory arbitration.” Technorati Tags: arbitration, ADR, law, U.S. Supreme Court, ADE waiver, Age Discrimination in Employment Act of 1967, National Labor Relations Act of 1935, 14 Penn Plaza LLC v. Pyett

Looks like the U.S. Supreme Court can’t have enough of arbitration this term. As posted at the Adjunct Law Prof, the Court vacated and remanded Kimberlin v Renasant Bank (Dkt No 08-816). The issue decided by the U.S. Court of Appeals for the Sixth Circuit was whether non-parties to an arbitration agreement can invoke Section 3 of the Federal Arbitration Act and compel arbitration. The U.S. Supreme Court decided this issue recently in Arthur Andersen LLP v. Carlisle, No. 08–146 (May 4, 2009) (find our case summary here). Because the Sixth Circuit’s decision was not in accord with Arthur Andersen LLP v. Carlisle, the Court remanded the case for further proceedings. Technorati Tags: arbitration, ADR, law, U.S. Supreme Court, Arthur Andersen v. Carlisle

The Supreme Court of Texas held that a post-injury arbitration acknowledgment agreement is valid and compelled arbitration of tort claims within the context of an employment contract. In In re Macy’s Texas, Inc., __ S.W.3d __ (Texas 2009) (No. 08-0584), Erica Tomsic was an employee at department store Macy’s. Tomsic claims to have injured her back while working at the store in April 2007. On May 9 2007, Tomsic signed an “Arbitration Acknowledgment” in which she acknowledges she had “received and read (or had the opportunity to read) the Summary Plan Description . . . for the Federated Department Stores, Inc. Injury Benefit Plan for Texas Employees, effective February 1, 2005.” Tomsic also acknowledged that the Plan required arbitration of on-the-job injuries against “the Company.” The Plan also contained the following clause: All Texas employees of Federated Department Stores, Inc, Macy’s West, Inc., and Federated Systems Group, Inc. will be covered by this program. References to the word “Company” in this booklet will mean your particular employer. Despite the arbitration agreement, Tomsic sued Macy’s Texas, Inc. and Macy’s Texas, Inc. moved to compel arbitration. Tomsic argued that she was not employed by any of the entities mentioned by the Plan, thus, she was not required to arbitrate her claims. The trial court denied Macy’s Texas, Inc. motion to compel arbitration. The Texas Supreme Court agreed with Tomsic that the affidavit alone is not sufficient to require relief. However, the court noted that the Plan defined “the Company” as “your particular employer.” In addition, the court stated that “Tomsic offers no explanation why she would agree with anyone other than her employer on a health-benefits plan or arbitration for on-the-job injuries.” The court also explained that although the Arbitration Acknowledgment predated Tomsic’s injury, the Plan did not. Because this case was decided under the Federal Arbitration Act, and not under the Texas Arbitration Act, post-injury arbitration agreements don’t have to be signed by each party’s attorneys. Accordingly, the court directed the trial court to enter an order to compel arbitration. Technorati Tags: arbitration, ADR, law, Texas Supreme Court