Arbitration Case Law Update

Published: February 2023
Written by: Donna Greenspan Solomon

Arbitration Case Law Update

Morgan v. Sundance, Inc., 142 S.Ct. 1708 (2022).  Employee brought nationwide collective action asserting employer violated federal law regarding overtime payment.  Eight months later, employer moved to compel arbitration.  The district court denied the motion, and the Eighth Circuit reversed, finding that a waiver of the right to arbitration required a showing of prejudice.  The US Supreme Court vacated and remanded, holding that prejudice is not required to show that a party, by litigating too long, waived its right to compel arbitration under the Federal Arbitration Act (“FAA”). 

Viking River Cruises, Inc. v. Moriana, 142 S.Ct. 1906 (2022).  The FAA preempts any state rule discriminating on its face against arbitration, for example, a law prohibiting outright the arbitration of a particular type of claim.

Southwest Airlines Co. v. Saxon, 142 S.Ct. 1783 (2022).  Any class of workers directly involved in transporting goods across state or international borders falls within FAA’s exemption for contracts of employment of seamen, railroad employees, or any other class of workers engaged in foreign or interstate commerce.

Outokumpu Stainless USA, LLC v. Coverteam SAS, 17-10944, 2022 WL 2643936, at *3 (11th Cir. July 8, 2022).  On remand from the US Supreme Court, the Eleventh Circuit found that non-signatory to the arbitration agreement could nevertheless compel arbitration as a defined party covered by the arbitration clause.

 Attix v. Carrington Mortgage Services, LLC, 35 F.4th 1284 (11th Cir. 2022).  The Eleventh Circuit held that a borrower and mortgage servicer, through an express delegation clause, clearly and unmistakably agreed to submit questions of arbitrability to the arbitrator, stating:  “At the end of the day, the ‘arbitrability of arbitrability’ is simply about the freedom to decide who decides disputes. Federal law provides, emphatically, that parties may opt out of the judicial system. One would be hard-pressed to find a topic about which the Supreme Court has provided more consistent clarity in recent years than arbitration. The Court’s precedents make clear that, when an appeal presents a delegation agreement and a question of arbitrability, we stop. We do not pass go. At some point in this litigation, someone may, perhaps, collect $200. Whether anyone will—and who will ultimately decide whether anyone does—are not questions we answer today.”

 Perera v. Genovese, 345 So. 3d 882 (Fla. 4th DCA 2022).  Once a court determines that arbitrator exceeded his or her powers, the court’s decision to vacate the award either in whole or in part is a discretionary decision that turns on whether the arbitrator’s other rulings are intertwined with the arbitrator’s unauthorized ruling.

Navarro v. Varela, 345 So. 3d 365 (Fla. 3d DCA 2022).  The determination of whether a particular claim must be submitted to arbitration necessarily depends on the existence of some nexus between the dispute and the contract containing the arbitration clause.  The trial court did not err in concluding that claims for intentional infliction of emotional distress and violations of the Florida Civil Rights Act were not arbitrable because they lacked a sufficient nexus to the parties’ agreement.

Malek v. Malek, 346 So. 3d 179 (Fla. 3d DCA 2022).  Arbitration agreement applicable to disputes between a company and its shareholders did not apply to dispute over ownership of the company in a dissolution action.

Addit, LLC v. Hengesbach, 341 So. 3d 362 (Fla. 2d DCA 2022).  Arbitration agreement contained on page 15 of 23-page assisted living residency agreement, which was neither set off nor made conspicuous in any manner, and where there was no opportunity for meaningful negotiation, was a contract of adhesion and was procedurally unconscionable; provision carving claims for eviction out of arbitration agreement was substantively unconscionable; as a matter of first impression, confidentiality provision of arbitration agreement was not substantively unconscionable; however, trial court erred in denying motion to compel arbitration where offending provisions were severable.

UniFirst Corp. v. Stronger Collision Ctr., LLC, 336 So. 3d 1283 (Fla. 3d DCA 2022). Under the rules of the American Arbitration Association (AAA) incorporated into arbitration provision,  plaintiff was entitled to proceed to ex parte arbitration under the AAA’s expedited rules, without seeking a court order compelling arbitration, after defendant chose not to participate in arbitration and did not reply to arbitration notices.

Donna Greenspan Solomon was the first attorney certified by The Florida Bar as both Business Litigator and Appellate Specialist.  Donna is a Member of the National Academy of Distinguished Neutrals and serves as a Chair on AAA (Commercial Panel) and FINRA arbitrations.  She is also a Certified Circuit, Appellate, and Family Mediator and Florida Supreme Court Qualified Arbitrator.  Donna is also a Member of the Florida Supreme Court Committee on Standard Jury Instructions—Contract and Business Cases.  Donna can be reached at (561) 762-9932 or Donna@SolomonAppeals.com or by visiting www.solomonappeals.com.

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For additional ADR tips and resources, go to www.palmbeachbar.org/alternative-dispute-resolution-committee.

15TH CIRCUIT JUDICIAL NOMINATING COMMISSION NOTICE OF VACANCIES AND ACCEPTANCE OF APPLICATIONS

The Fifteenth Circuit Judicial Nominating Commission (“JNC”) announces two vacancies: one vacancy for a Circuit Court Judge position created by the elevation of Judge Paige Kilbane and one vacancy for a County Court Judge position created by the elevation of Judge John Parnofiello.  The JNC has been asked to provide Governor Ron DeSantis with nominees for both vacancies by Friday, March 17, 2023.

Qualifications of Applicants:

Applicants must be able to fulfill the Constitutional qualifications for county court judges described in Article V, Section 8 of the Florida Constitution.

Instructions for Submission:

1)            The current Judicial Application form must be used and can be found at https://www.flgov.com/judicial-and-judicial-nominating-commission-information/. Applicants should ensure they are using the correct and current form.

2)            Applications must be in .pdf form and submitted as follows: (i) one original copy of the application, including all attachments, (ii) one redacted copy of the application, including all attachments, excluding all exempt information under Chapter 119 of the Florida Statutes or other applicable public records law. The two .pdf files should be named in a “last name.first name” format. For example: Jane Smith should submit two files named: (1) Smith.Jane.pdf and (2) Smith.Jane-REDACTED.pdf. Each electronic application, including exhibits, must be a single pdf file. The Commission strongly prefers the submission of applications in a text-searchable (i.e., non-scanned) pdf format.

3)            The deadline for submission of the completed application is 5:00 p.m., Friday, February 24, 2023. Please state in your application whether you are applying for the Circuit Court Judge vacancy, the County Court Judge vacancy, or both vacancies.  Both the original and redacted electronic applications must be submitted by email to all Commission members at their email addresses below:

It is anticipated that any interviews will be held the week of March 13, 2023.

All JNC proceedings are open to the public, except for deliberations.  Applications are not confidential.  If an applicant is nominated, all materials attached to the original application will be submitted to the Governor.

If you have any questions, please call Mr. Harvey at (561) 303-2918, or by email at robert@flbiznow.com

DEADLINE EXTENDED: 2023 JUDICIAL NOMINATING COMMISSION NOMINATIONS TO BE MADE

The deadline has been extended for 2023 JUDICIAL NOMINATING COMMISSION NOMINATIONS no later than 5:30 p.m., Friday, February 24, 2023. For more details, please click here to visit the following link: