In answer to the proverbial question “how much litigation waives the right to arbitrate?,” the Third Circuit has responded that ten months does the trick, if the party seeking arbitration has engaged in significant motion practice, regardless of whether any discovery was exchanged. In re Pharmacy Benefit Managers Antitrust Litig., __ F.3d __, 2012
Liz Kramer
Liz Kramer current serves as Minnesota's Solicitor General. Previously, she was a partner at Stinson Leonard Street and the founder of the award-winning blog, ArbitrationNation.
Arbitration Non-Signatories Lose in Fifth and Eighth Circuits
Two circuit court decisions in the last week have denied arbitration motions based on the lack of an arbitration agreement between the parties. These decisions show that while the federal presumption in favor of arbitration is generally a strong current, it is not strong enough to pull non-signatories into arbitration (or even to stay their…
Don't Game The System: "A Motion To Compel Arbitration Will Almost Never Be Futile"
After an arbitration about-face by the defendant in a class action, the Eleventh Circuit ruled that the defendant had waived its right to compel arbitration by: participating in litigation for two years and affirmatively declining to enforce its arbitration agreement with the plaintiffs until after SCOTUS issued its Concepcion decision. Garcia v. Wachovia Corp.,…
Arbitrators Labeling Your Securities "Crap" Does Not Entitle You To Vacate The Award
In the last post, the Fifth Circuit affirmed an arbitration award against Morgan Keegan. The Ninth Circuit just affirmed an arbitration award against Morgan Keegan in a sister case. In less than two pages, the Ninth Circuit rejected Morgan Keegan’s arguments that the arbitrators were partial or exceeded their power. Morgan Keegan & Co. v.
Expert's Trick (changed damage calculation) Does Not Entitle Arbitration Loser to a Treat (a/k/a vacatur)
The Fifth Circuit recently refused to vacate an arbitration award, despite the loser’s arguments that: the arbitrators decided claims outside the scope of the arbitration agreement; and the winner’s expert used incorrect damage numbers in his testimony. Morgan Keegan & Co., Inc. v. Garrett, 2012 WL 5209985 (5th Cir. Oct. 23, 2012).
At issue in…
An ArbitrationNation Roadmap: Document subpoenas to third parties
This post is dedicated to a perennial favorite topic: subpoenas for documents in arbitration. Why this topic and not something hot off the presses? Because SCOTUS has not yet accepted or denied the cert petition in Sutter, and no cases have come out recently that meet my high standards for discussion on this blog…
How Low Can You Go? Shortening the Statute of Limitations in Arbitration Agreements
I see more and more arbitration agreements that contain their own limitations period (the timeline for bringing a dispute in arbitration). Are all of those necessarily enforceable? No.
In Order of United Commercial Travelers of America v. Wolfe, 331 U.S. 586 (1947), the Supreme Court held that contracts may shorten the statute of limitations…
Eighth Circuit Rules Investors Are Not "Customer" Of Managing Broker-Dealer Under FINRA, So Arbitration Not Required
In an opinion that runs less than three pages, the Eighth Circuit ruled that a managing broker-dealer is not obligated under the FINRA rules to arbitrate with a group of investors who purchased securities from another party. Berthel Fisher & Co. Fin. Servs., Inc. v. Larmon, __ F.3d. __, 2012 WL 4477433 (8th…
Arbitration Award Can Be Vacated If It Directs Party To Perform Illegal Act
In a new decision from the First Circuit, which refuses to make any definitive pronouncements about the law on vacating arbitration awards, the court said it assumes “with some confidence” that if an arbitration award directed a party to violate an administrative agency rule, it could be vacated on that basis.
In Bangor Gas Company…
Incorporation of Collective Bargaining Agreement on Routine Form Insufficient to Create Arbitration Agreement
This is unheard of! There were two circuit court decisions finding no binding agreement to arbitrate in a single week. (The first is here.) In this new decision from the Third Circuit, an employer’s submission of forms to a union fund along with fringe benefits is held insufficient to compel that employer to arbitration…