Book Reviews: Richard L. Hasen’s “The Justice Of Contradictions: Antonin Scalia and the Politics of Disruption”
Marc's Review Of Richard L. Hasen's The Justice of Contradictions: Antonin Scalia and the Politics of Disruption, Has Been Published in California Litigation.
With the permission of California Litigation, the journal of the litigation section of the California Lawyers Association, Marc's review of Prof. Richard L. Hasen's book, The Justice of Contradictions: Antonin Scalia and the Politics of Disruption, is made available by clicking here.
Arbitration, Employment, Nonsignatories: 2/6 Orders Produce Packers To Arbitrate Claims With Co-Employers
Staffing Agency Signed Arbitration Agreement, Packing Employer Did Not Sign.
Packing fresh prunes at night on Produce Row during busy season, wages two cents per box. Washington, Yakima. Dorothea Lange, photographer. August 1939. Library of Congress.
Plaintiffs/Respondents Vasquez and Zacarias were hired by a staffing agency, Employer's Depot, Inc. (EDI) which assigned them to a produce packing employer (San Miguel Produce, Inc.). Plaintiffs alleged labor violations by San Miguel Produce, with which they did not have an arbitration agreement, and San Miguel Produce cross-claimed against EDI, which did have an arbitration agreement with Plaintiffs. The superior court denied a motion by San Miguel Produce and EDI to compel arbitration (a) because Plaintiffs did not sue EDI; and (b) because Plaintiffs did not have an arbitration agreement with San Miguel Produce. Vasquez et al. v. San Miguel Produce, No. B287696 (2/6 1/3/19) (Perren, Gilbert, Tangeman) (unpublished).
Reversed and remanded: "Appellants are co-employers with an identity of interests and mutual responsibility for complying with state law governing employers in the produce packing industry. It is inconsequential that respondents chose not to name EDI as a defendant. They agreed to arbitrate 'all disputes' arising from their employment."
Arbitration, Collective Bargaining: Third District Affirms Orders Denying Employer’s Motions To Compel Arbitration
And Employees' Claims Were Not Preempted By Labor Management Relations Act, 1947 (LMRA).
In three consolidated appeals, the Court of Appeal affirms orders denying the employer's motions to compel arbitration. Rymel v. Save Mart Supermarkets, Inc., and related cases, C085863, C085865, C085886 (3rd Dist. 12/31/18) (Duarte, Murray, Hoch).
The employees sued defendant Save Mart Supermarkets, Inc., alleging state law statutory employment claims for industrial injuries and torts flowing therefrom, including failure to accommodate, retaliation, and wrongful discharge. After successfully moving to sever, the employer moved to compel arbitration under a collective bargaining agreement (CBA). Its motions failed in the superior court, and it appealed.
The CBA did not bind the employees to arbitrate, because it failed to clearly and unmistakably require the employees to arbitrate the statutory claims in question. The knottier issue was whether the state law claims were preempted — not by the Federal Arbitration Act, but by the LMRA, section 301.
The Court applied a two-step analysis to the preemption issue. First, the causes of action involved rights conferred upon the employees by virtue of state law, not by the CBA. Second, the rights underlying the state law claims were not "substantially dependent on analysis of a CBA." As the Court explains, "Generally, a claim based on a 'nonnegotiable' right will rarely require interpretation of a CBA, which by definition represents the culmination of negotiations between labor and management."
Affirmed.
DRAFTING TIP: Clearly and unmistakably identify in the CBA the statutes and rights that are to be arbitrated.
Arbitration Deadlines: 9th Circuit Holds That Petition To Vacate Arbitration Award Is One Day Late
Opinion Clarifies How To Perform Calculation.
In Stevens v. Jiffy Lube, No. 17-15965 (9th Cir. 12/27/18) (McKeown, Fletcher, Bybee), the panel affirms the district court's denial of a petition to vacate an arbitration award, on the grounds that the petition was one day late. In doing so, it clarifies how to calculate the deadline.
The arbitration award was delivered on September 14, 2016, and the petition was filed on December 15, 2016. Look to Federal Rule of Civil Procedure 6(a) for how to calculate the three-month filing deadline under the Federal Arbitration Act's three-month filing deadline. The Federal Rules of Civil Procedure apply to FAA proceedings, unless the FAA provides otherwise.
1. When the period is stated in days or a longer unit of time (here, three months), exclude the day of the event that triggers the period, here, September 14, 2016.
2. Count every day, including intermediate Saturdays, Sundays, and legal holidays.
3. Include the last day of the period, but if the last days is a Saturday, Sunday, or legal holiday, the period continues to run until the end of the next day that is not a Saturday, Sunday, or legal holiday.
Arbitration, Waiver, Disclosures, Record: 2/1 Affirms Judgment In Favor Of Doctor In Malpractice Case, Over Objections Of Failure To Disclose And Improper Testimony By Arbitrator
Court Chastises Plaintiff's Counsel And Neutral Arbitrator.
The Court of Appeal expresses displeasure with "unfortunate conduct" by plaintiff's counsel and the neutral arbitrator. The conduct included "omissions of key facts and misrepresentations . . . that would allow us to deem plaintiff's challenges as forfeited," and testimony by the "neutral arbitrator" in the superior court, in which the neutral arbitrator appeared to side with defendant, as well as untimely disclosures by the arbitrator. However, the arbitrator's flubs did not affect the ultimate outcome, an opinion affirming a judgment confirming the arbitrator's award in favor of defendant in plaintiff/patient's med-mal case. Cox v. Bonni, B279476 (2/1 12/17/18) (Bendix, Rothschild, Chaney).
Plaintiff unsuccessfully argued that defendant waived the right to arbitrate by participating for seven months in litigation, and by engaging in discovery. But plaintiff failed to mention that defendant sent her a letter demanding arbitration two months after defendant answered the complaint. When briefing the Court of Appeal, one must completely and fairly summarize the evidence supporting the trial court's findings and judgment, and this was not done.
While defendant did engage in discovery, the arbitration agreement allowed for discovery. Therefore, the Court of Appeal concluded that plaintiff was unable to show prejudice resulting from defendant's conducting discovery in a court proceeding.
Regarding the conduct by the arbitrator, the arbitrator failed to make timely disclosures. But the plaintiff overreached, claiming that the arbitrator "did not provide any disclosures regarding his work and other history" with a defense attorney who substituted in. And then, plaintiff sat on objections to the arbitrator's untimely disclosures until plaintiff received a disappointing result in arbitration. Just as the arbitrator needed to make timely disclosures, the plaintiff needed to timely object to untimely disclosure.
The arbitrator testified before the trial court. Generally, that is forbidden, unless the arbitrator is testifying to defend against a charge of bias. "It does not appear to us, however, that the neutral arbitrator merely testified," explained the Court. "The record demonstrates that he propounded legal argument as if he were an advocate for defendant, pointing out, for example, plaintiff's failure to timely object to his late disclosures. This was improper, and the trial court erred in allowing the neutral arbitrator to do so." But the Court concluded that the arbitrator's faux pas amounted to harmless error.
COMMENT: Over the course of an arbitration hearing, and a motion to confirm in trial court, errors are sometimes made by arbitrators and judges. But the doctrines of "harmless error" and "lack of prejudice" wash out many stains on appeal.
Arbitration, Collective Bargaining,Gateway Issues: 9th Circuit Rules That Arbitrator’s And District Court’s Confusion Over Arbitrability And Merits Determination Requires Reversal Of Court And Vacation Of Award
Majority, Concurring, And Dissenting Opinions.
Judge Bucklo, sitting by designation, describes the appeal of a labor arbitration award as "surprisingly nuanced", an "analytical puzzle" and "inscrutable." Judge Owens, concurring, believes, "most importantly, the extremely convoluted procedural posture of this case is so odd that our holding today likely will be limited to these very idiosyncratic facts." And Judge Friedland, dissenting, isn't having it. Let's try to unpack this case. Local Joint Executive Board of Las Vegas, et al. v. Mirage Casino-Hotel, Inc., No. 16-16754 (9th Cir. 12/13/18).
The Union submitted a grievance with the Mirage Casino-Hotel to arbitration. The Union had agreed by way of a Collective Bargaining Agreement (CBA), Memorandum of Agreement, and side letter, that Mirage could subcontract its operations, and the Union culinary workers could work under the subcontracting arrangements for the subcontractor, with Mirage maintaining "full control of the terms and conditions of employment." After the subcontractor, BB King's, a restaurant concession, went bankrupt, the Union members filed a grievance to obtain vested vacation pay and other accrued benefits from Mirage. Because the scope of the arbitration provision covered Union grievances, the Union submitted the grievance to arbitration.
Here's where it gets dicey. A merits issue was whether the Union members were employees, and Mirage, arguing that they were not employees of Mirage, objected that the dispute was not arbitrable, because Mirage was not the proper party for arbitrating the grievance. The arbitrator agreed, apparently concluding that the Union's remedy to recover was against BB King's, and determined that the dispute was not arbitrable, a result that was confirmed by the district court.
Judge Bucklo explained that the arbitrator, and the district court, confused the merits issue with arbitrability. While everyone seemed to agree that the merits issue was within the scope of the arbitration provision, and to be decided by the arbitrator, the threshold issue of "who should decide who should decide" was not "clearly and unmistakably" submitted to the arbitrator, who had decided that the matter was not arbitrable. Therefore, the court, not the arbitrator, should decide whether the matter was arbitrable, and deciding that the merits were arbitrable, the court should vacate the award and send the parties back to arbitration — which is what the 9th Circuit has now done.
Judge Owens joined the majority "because I believe it is more consistent with current controlling law." But he thinks "the dissent reaches the more equitable result and, if the slate were blank, I would join it."
And Judge Friedland dissents, explaining that, under the facts here, "the 'clear and unmistakable' test for determining whether a party resisting arbitration has nevertheless consented to having the arbitrator decide substantive arbitrability" should not apply "when determining whether a party that initiates arbitration has so consented." Here, the Union submitted the matter to arbitration, and therefore should be stuck with the result.
COMMENT: Yes, the Union submitted the grievance to arbitration, but obviously the disagreement among the judges is about whether the Union submitted the threshold question of "who should decide who should decide" arbitrability to the arbitrator by submitting the grievance to arbitration and participating in the arbitration.
If the matter is now returned to the arbitrator, and the arbitrator focuses on whether the CBA and other agreements impose on Mirage an obligation to provide the benefits that BB King's should have provided, then I suppose the arbitrator might reach a result in favor of the Union. But this could instead end up as an exercise, albeit quite an interesting one, in futility, if the arbitrator, upon concluding earlier that Mirage was not the employer, also believed that BB King's was the employer, and that Mirage was not the guarantor of the employer's obligations.