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Arbitration Law Memo October 2008
by Ross Runkel at LawMemo
| Arbitration Law Memo - October 2008 LawMemo First in Employment Law Arbitrator biographies and awards: National Arbitration Center |
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Arbitration - Individual Arbitration Agreements *** ***
Arbitration - Collective Bargaining Agreements *** *** Arbitration - Individual Arbitration Agreements ***2nd - Sarbanes-Oxley Act whistleblower claims are subject to arbitration.Guyden v. Aetna (2nd Cir
10/02/2008) Guyden sued the employer, asserting a whistleblower claim under the Sarbanes-Oxley Act (SOX). The trial court dismissed, based on the parties' arbitration agreement. The 2nd Circuit affirmed. The court held that SOX claims are subject to arbitration. The court rejected Guyden's argument that there exists an "inherent conflict" between SOX's underlying purpose (the public dissemination of information about a corporate employer's fraudulent activities) and arbitration. The court observed that "[t]ellingly ... both Houses of Congress, acting separately, rejected versions of SOX that would have prohibited mandatory arbitration of whistleblower claims." Guyden made a similar argument regarding a confidentiality clause in the arbitration agreement, but the court rejected that as well. With respect to that conclusion, the court stated "[w]e agree ... with the Fifth Circuit's observation that confidentiality clauses are so common in the arbitration context that Guyden's 'attack on the confidentiality provision is, in part, an attack on the character of arbitration itself.'" 11th – Employer’s promise to engage in arbitration wasn’t illusory, so arbitration agreement didn’t fail for lack of consideration.Lambert v. Austin (11th Cir
10/07/2008) Lambert sued the employer, asserting age discrimination, race discrimination, and retaliation claims under the Age Discrimination in Employment Act (ADEA) and Title VII. The trial court denied the employer’s motion to compel arbitration. The 11th Circuit reversed, concluding that Lambert’s claims fell within the scope of a valid arbitration agreement. The court rejected the argument that the arbitration agreement was invalid for lack of consideration, which was based on the argument that the employer’s promise to engage in arbitration under the agreement was illusory. The agreement provided, in part: "You should consult your Open Door facilitator to determine if your workplace dispute is appropriate for presentation to an arbitrator. If so, the facilitator will contact the AAA to initiate the process." The court found that this language did not mean that the employer's facilitator had ultimate authority to deny arbitration. *** Arbitration - Collective Bargaining Agreements ***9th – Employer’s tortious interference claim against international union wasn’t cognizable under LMRA Section 301(a).Granite Rock v. Intl Brotherhood
(9th Cir 10/22/2008) The employer sued the local union and its international, asserting claims for violation of Section 301(a) of the Labor Management Relations Act (LMRA). The employer alleged that the local breached the parties’ collective bargaining agreement (CBA), and the international tortiously interfered with that agreement. The trial court dismissed for “failure to state a claim” under Fed.R.Civ.P. 12(b)(6). The 9th Circuit affirmed as to the international, but reversed as to the local. The court held that the employer’s tortious interference claim against the international did not “arise under” the CBA between the employer and the local, and thus affirmed dismissal as to the international. The court reasoned that because the international “has no rights or duties under the agreement … [the employer’s] tortious interference claim … does not meet the requirements of section 301(a).” The court noted that “[t]he majority of our sister circuits to have considered the question have declined to find a section 301(a) cause of action against parties not governed by the relevant agreement.” The court also noted that “the circuits are almost unanimous in rejecting LMRA jurisdiction over a claim such as [the employer’s claim against the international].” The court reversed as to the employer’s claim against the local union, based on its determination that the trial court should have compelled arbitration of that claim. ME – Prior arbitration pursuant to collective bargaining agreement precluded employee from challenging discharge decision.Quintal v. City of Hallowell
(Maine 10/07/2008) Quintal sued the municipal employer, challenging (pursuant to M.R.Civ.P. 80B) its decision to terminate his employment, and asserting a 1st Amendment retaliation (free speech) claim. The trial court granted summary judgment in favor of the employer. The court affirmed, concluding that 1) binding arbitration pursuant to the parties’ collective bargaining agreement precluded Quintal from pursuing his Rule 80B appeal; and 2) Quintal’s 1st Amendment claim failed because the speech at issue did not touch on a matter of public concern.
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Employment Law Editor: Ross Runkel,
Professor of Law Emeritus.
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