Published in Law 360 (April 23, 2017)

We recently began a series of articles in which we ask: Is “class arbitration” viable given the essential nature of arbitration, or is it an oxymoron? (The premise here is that “class arbitration” signifies the utilization of a Federal Rule of Civil Procedure 23 class action protocol in an arbitration proceeding.) In this article, we examine possible bases for the viability of class arbitration. Spoiler alert: they do not hold up to scrutiny.

Continue Reading Is “Class Arbitration” an Oxymoron? (2) Examining Theoretical Bases for Class Arbitration

“Class arbitration” — the utilization of a class action mechanism in an arbitration proceeding — is considered by some to be the unicorn of ADR; desirable but elusive. Another view is that it is the Frankenstein’s monster of ADR – an anomalous hybrid of disparate parts that comprise a disconcerting and ultimately nonviable creation.  And so let us ask, is “class arbitration” an oxymoron?  Should it be viable given the essential nature of arbitration?  And whither the emperor’s jurisprudential clothes?

Continue Reading Is “Class Arbitration” an Oxymoron?

In CBF Industria de Gusa S/A v. AMCI Holdings, Inc., 2017 U.S. App. LEXIS 3815 (2d Cir. Mar. 2, 2017), the U.S. Court of Appeals for the Second Circuit provides something of a primer regarding enforcement in the United States of a foreign-issued arbitral award, which is subject to the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards (“New York Convention”) and Chapter 2 of the Federal Arbitration Act (“FAA”).  In an effort to clear up confusion, the court (i) defined several pertinent terms and explained their significance, (ii) urged practitioners and judges to use consistent terminology, (iii) examined when a district court sits in primary jurisdiction versus in secondary jurisdiction, (iv) explained the differences between a non-domestic arbitral award and a foreign arbitral award, and (v) described the treatment of each when brought to a U.S. district court for enforcement.

Continue Reading A Primer for Enforcement in the U.S. of Foreign-Issued Arbitration Awards (Courtesy of the Second Circuit)

Last month, we described the split among Federal Circuit Courts regarding the question of whether the Federal Arbitration Act (“FAA”), 9 U.S.C. § 3, mandates a stay rather than dismissal of a judicial proceeding after a district court compels arbitration of all of the claims in an action before it. (LINK) But what is the practical significance of the district court’s retaining jurisdiction?  Among other things, it may thus be able to grant interim relief in order to preserve the status quo pending arbitration.

Continue Reading Powers of a District Court to Grant Interim Relief After Compelling Arbitration of All Claims Before It

In an earlier post we provided advice on how to interpret the words “may” and “must” when they appear in arbitration clauses that are to be interpreted under U.S. law. Among other things, we explained that an arbitration clause that says that a party “may” submit a dispute to binding arbitration will be viewed as mandatory in U.S. courts if any party chooses to arbitrate.

That post led us to question whether those “may” and “must” words are interpreted consistently in other English-speaking common law countries. In typical litigator fashion, and for the reasons set forth below, we conclude that it depends.  The relevant laws of Canada, England, and Singapore are apparently consistent with that in the United States, while those of India and Australia are not.

Continue Reading Mandatory vs. Permissive Arbitration Clauses: A Survey of the Laws of Other Common Law Countries

Federal public policy favors arbitration and the broad interpretation and enforcement of arbitration agreements. So how can an arbitration agreement be held by a court to be void as against public policy?  One answer from a state court (in circumstances where the Federal Arbitration Act did not apply) is that toying with a statutory arbitration scheme could do the trick.

Continue Reading An Arbitration Agreement That Attempts to Skew a Statutory Arbitration Scheme Is Void as Against Public Policy

You presented your case, and the arbitration tribunal came back with a reasoned decision and an award in your favor. You even had the award confirmed here in the United States.  You want to enforce it.  But you find that the award-debtor’s assets are all held in or have been moved to a country that is not a party to the New York Convention.  Now what?

Continue Reading Enforcement of an International Arbitration Award in a Non-New York Convention Country

Under the Federal Arbitration Act (“FAA”), 9 U.S.C. §§ 1 et seq., if a District Court compels arbitration of all of the claims that are before it, and thereupon dismisses the suit, its order compelling arbitration is final and appealable; but if the District Court stays the suit, its order compelling arbitration is “non-final” and not immediately appealable.  So what’s a right and proper court to do? The Federal Courts of Appeal are divided on the question of whether the FAA requires a stay or dismissal of judicial proceedings after a District Court sends all of the claims in suit before it to arbitration.  Currently, some parts of the U.S. are in effect more “arbitration friendly” in this regard than others.

(Note that we are not considering here the case of an “independent” motion to compel or to stay arbitration.  In that case, a petition under FAA § 4 commences a special proceeding, and no ordinary claim in suit is before the court.)

Continue Reading Does the Show Stop For Appeal After a Court Compels Arbitration? The Federal Circuit Courts Are Split

UPDATE: On February 8, 2017, the Supreme Court announced that it would delay until its October 2017 term oral arguments in the consolidated cases concerning the enforceability of class arbitration waivers in employment agreements.  (This updates our Blogpost dated Jan. 31, 2017.)

Many anticipate that Judge Gorsuch will have been confirmed by the Senate by then, which likely explains the Supreme Court’s decision to delay oral argument. Because the Court granted certiorari based upon a Circuit split, it presumably hopes to avoid a possible 4-4 vote by the current Justices, which would permit the various Circuit Court rulings to stand, leaving the matter unresolved nationally.

While we expect that Justice Gorsuch, a reputed strict constructionist, will in effect be a pro arbitration judge, his questions during oral argument will offer a glimpse of how he might decide the particular issues presented here concerning employment class arbitration.

The Supreme Court is currently set to answer the question of whether employees must be permitted, if they choose, to pursue relief collectively in an arbitration proceeding. Is that “concerted activity” that is protected by the National Labor Relations Act, and does that statutory provision supervene the provisions of the Federal Arbitration Act and the right to contract freely?  And specifically, is a waiver of class actions in an arbitration clause in an employment agreement enforceable?

Continue Reading Employers Hold Their Collective Breath re the Enforceability of “Class Action” Waivers in Arbitration Agreements — Supreme Court to Part the Clouds this Term