Arbitration & Mediation

Arbitration Law Memo July 2007

Arbitration Law Memo July 2007
by LawMemo - World's Best

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*** Arbitration - Individual Contracts ***

• US - Update on US Supreme Court FAA case.

*** Arbitration - Collective Bargaining Agreements ***

• 7th - Recognition clause of CBA was adequate basis for arbitration (2-1).

• CA - Arbitrator exceeded power by violating Dills Act.

*** Arbitration - Individual Contracts ***

US - Update on US Supreme Court FAA case.

Hall Street Associates, L.L.C. v. Mattel, Inc. (Docket No. 06-989)
Certiorari granted May 29, 2007.
Oral argument in October 2007 or later.
Case below: Hall Street Associates, L.L.C. v. Mattel, Inc. (9th Cir 08/01/2006) (not published) Majority: http://www.lawmemo.com/docs/9/hallstreet_maj.pdf
Dissent: http://www.lawmemo.com/docs/9/hallstreet_dis.pdf
Petition for writ of certiorari: http://www.scotusblog.com/movabletype/archives/06-989.pdf
Brief in opposition: http://www.lawmemo.com/sct/06/HallStreet/cert_BIO.pdf
Reply: http://www.lawmemo.com/sct/06/HallStreet/cert_reply.pdf

Question Presented by the certiorari petition: "Did the Ninth Circuit Court of Appeals err when it held, in conflict with several other Courts of Appeal, that the Federal Arbitration Act ("FAA") precludes a federal court from enforcing the parties' clearly expressed agreement providing for more expansive judicial review of an arbitration award than the narrow standard of review otherwise provided for in the FAA?"

After a lawsuit got going in federal court, the two parties agreed to arbitrate the case rather than litigate. The agreement provided that the federal district court shall vacate, modify, or correct the arbitrator's award "where the arbitrator's conclusions of law are erroneous." The 9th Circuit refused to enforce this provision because the Federal Arbitration Act specifies that arbitration awards can be vacated only in limited cases involving such things as fraud, corruption, partiality, or when the arbitrators exceed their powers. Therefore, the arbitrator's award was upheld even though it contained possible errors of law.

*** Arbitration - Collective Bargaining Agreements ***

7th - Recognition clause of CBA was adequate basis for arbitration (2-1).

IBEW v. Illinois Bell (7th Cir 07/02/2007)
http://caselaw.lp.findlaw.com/data2/circs/7th/062335p.pdf

The union moved to compel arbitration with the employer concerning the implementation of consumer performance management guidelines. The trial court granted the union's motion. The 7th Circuit affirmed.

The union argued that the employer's actions constituted a breach of the recognition clause of the collective bargaining agreement (CBA). The court noted that the employees were evaluated based on the tasks they performed when the CBA was negotiated, and now would be evaluated upon sales results which, if less than the sales quota, could lead to discipline and discharge. Because the CBA contained a no strike provision, the court stated that the union would be left with no recourse if unable to compel arbitration. The court held that the recognition clause was an adequate basis for arbitration in this case.

The DISSENT argued that the dispute was not arbitrable where the CBA contained no terms or provisions relating to performance guidelines or standards, where the dispute concerned the performance guidelines policy itself, and where the discipline of an employee was not involved.

CA - Arbitrator exceeded power by violating Dills Act.

Dept of Personnel v. California Correctional (California Ct App 06/29/2007)
http://www.courtinfo.ca.gov/opinions/documents/C051636.PDF

The arbitrator reformed a written collective bargaining memorandum of understanding (MOU). The trial court vacated the arbitrator's award. The California Court of Appeal affirmed. Under the Dills Act, the Legislature ratified and approved the MOU. The court found that, in changing the terms of the of the MOU after it was approved by the Legislature, the arbitrator exceeded her powers by violating the Dills Act and the important public policy of legislative oversight of state employee contracts.

Full post as published by Arbitration Law Memo on July 17, 2007 (boomark / email).