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.,
Are Residential Real Estate Contracts Outside The Bounds of the Federal Arbitration Act?
The Supreme Court of South Carolina just ruled that contracts for the sale of residential property are not interstate commerce, and therefore are outside the reach of the Federal Arbitration Act. Bradley v. Brentwood Homes, Inc., __ S.E.2d __, 2012 WL 2847616 (S.C. July 11, 2012). That is a surprising result in my view,
Parties Can Waive Arbitration, Despite A "No Waiver" Clause in Contract
The Sixth Circuit easily affirmed a district court’s finding that the defendant had waived its right to arbitration by participating in litigation for eight months. Johnson Assoc. Corp. v. HL Operating Corp., __ F.3d __, 2012 WL 1861675 (6th Cir. May 23, 2012). Plaintiffs had filed suit in late December of 2009 and a discovery
Arbitration Clause Sticks To Non-Signatories Like A Half-Eaten Halloween Sucker
Two recent decisions illustrate how individuals that did not sign a contract can be bound by that contract’s arbitration provisions.
In the first, Blaustein v. Huete, 2011 WL 5103759 (5th Cir. Oct. 26, 2011), an individual member of an LLC, Huete, argued he should not be bound by the arbitration clause between the LLC
Reviving Your Right To Arbitrate
The Eleventh Circuit has ruled that the plaintiff’s act of amending its complaint may allow a defendant to resurrect its previously-waived right to arbitrate. “[I]n limited circumstances, fairness dictates that a waiver of arbitration be nullified by the filing of an amended complaint.” Krinsk v. Suntrust Banks, Inc., __ F.3d ___, 2011 WL 3902998,
Proving A Waiver of Arbitration Rights Is Now Easier In Construction Cases (8th Cir.)
A party with an arbitration agreement can waive its right to arbitrate by acting inconsistently with that right, usually by “invoking the litigation machinery” before demanding arbitration. However, the federal circuits are split over whether a party asserting a waiver of arbitration must also show it was prejudiced by the other party’s use of that