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Blog: Arbitration Required in TCPA Class Action Even Though Violation Occurred After Termination of the Contract

Jay Ramsey with Sheppard Mullin Richter & Hampton LLP summarizes a May 11, 2015 opinion by the Seventh Circuit Court of Appeals. That court reversed an order denying a motion to compel arbitration in a Telephone Consumer Protection Act class action suit. The Seventh Circuit held that the agreement was broad enough to apply to conduct that occurred after the termination of the agreement. According to Ramsey, "Sprint argued, and the Seventh Circuit agreed, that arbitration clauses still apply to conduct occurring after termination of an agreement so long as the conduct had its 'genesis' in the agreement. In this case, the Seventh Circuit found an 'intimate relation' between Sprint's phone callas and the parties' agreement."

Texas: Trial Court Committed No Error Confirming Arbitration Award When Party Did Not Appear

In KNJ Enterprises, Inc. v. Wilbanks & Wilbanks, PC, the Fourteenth Court of Appeals held that a trial court did not err when it confirmed an arbitration award when one of the parties did not appear at the arbitration. Wilbanks initiated an arbitration proceeding against KNJ. According to the opinion, despite receiving notice of the proceeding, KNJ did not appear. KNJ initiated its own arbitration proceeding against Wilbanks, which was enjoined from proceeding by the trial court because of Wilbanks' pending arbitration. Ultimately, the trial court entered an award in favor of Wilbanks. KNJ appealed, arguing that the trial court erred because KNJ's claims could not have been heard when KNJ did not appear at the arbitration. The Court of Appeals rejected KNJ's argument, holding that the arbitrator determined KNJ received proper notice of the arbitration and that KNJ could not prevent the consideration of its claims be opting not to participate in an arbitration proceeding of which it had notice. H/T to R ...

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Texas: Arbitration, Collateral Estoppel, and Collective Bargaining Agreements

In City of San Antonio v. Cortes, the San Antonio Court of Appeals held that the trial court should have compelled arbitration pursuant to a collective bargaining agreement, and because a decision between a union and the City of San Antonio prevented the relitigation of a dispute between a union member and the city.

Cortes, a San Antonio firefighter, alleged that the City breached the collective bargaining agreement relating to health benefits and brought suit. The City argued that the dispute should be sent to arbitration. The City's motion to compel arbitration was denied, resulting in the City filing an interlocutory appeal.

The Court of Appeals provides an analysis of reviewing an arbitration agreement and whether the claim brought by Cortes, which is, according to the Court, "identical" to the claims brought by the firefighter's union against the City.

H/T to Ronnie Hornberger for notifying us of this decision.

Don't Call It a Trial

Gary McGowan is a noted arbitrator and mediator based in Houston, but with a national and international presence. Gary is scheduled to join the State Bar of Texas ADR Section Council as a councilmember this summer.

Gary's written an article, "Don't Call It a Trial: What Litigators Should Know about Arbitration" which was published in The Houston Lawyer. The article describes itself as a primer on arbitration, providing definitions of terms, the importance of the arbitration contract, and outlining arbitration procedures. You can find the article here.

Thanks to Gary for this article and we're looking forward to his service on the council.

Fifth Circuit: District Court erred in vacating contingency fee award as unconscionable

In Campbell Harrison & Dagley, LLP v. Hill, the Fifth Circuit Court of Appeals analyzed the trial court's order that vacated most of an arbitration award. The arbitrators awarded the law firms their fees, based upon a hybrid hourly-rate fee (approximately $3.15 million) and a contingency fee (approximately $25 million). The district court vacated the arbitrators' award of the contingency fee, which was challenged on appeal to the Fifth Circuit. The Fifth Circuit Court of Appeals examined the Texas General Arbitration Act, as well as Hill's claim that the contingency award was unconscionable. Concluding that the district court substituted its judgment for that of the arbitrators, the Fifth Circuit upheld the hourly-rate fee and reversed and rendered the contingency fee award in favor of the law firms.

Our 50th Blog Post

Launched in July, 2014, we've now reached our 50th blog post on mediation and arbitration.

Though relatively new, the Texas Bar Today recognized one of our blogs as a "Top 10 Blog Posts".

This blog was created to keep our members and the public informed of important developments in the area of mediation, arbitration, and other ADR-related matters. We don't blog about every court decision that is issued, but we try to blog about the important ones. We also blog about interesting developments from practitioners so that arbitrations, mediations, and other ADR-related procedures can continue to develop.

If you know of an important case, or a topical blog that we should know about, please send a summary (with a link) to our blog editor, Gene Roberts.

Texas: Supreme Court will not force parties to arbitrate unless there's an agreement

In G.T. Leach Builders, LLC v. Sapphire V.P., LP, the Texas Supreme Court examined whether a property developer must arbitrate its claims against several defendants involved in a construction project. The trial court denied all of the defendants' motions to compel arbitration and that decision was affirmed by the court of appeals. The Texas Supreme Court held that the developer must arbitrate its claims against the general contractor, but not against the other defendants because there was an arbitration agreement between the general and the developer, but not with the other defendants. This decision discusses the law on waiver of the right to arbitrate, as well as an analysis relating to the deadline for arbitration.

Blog: Is the facilitative approach useful in mediating commercial disputes?

In this article by Thomas I. Elkind, a partner at Foley & Lardner LLP, the question of a facilitative versus evaluative mediation is discussed, with the author concluding that a facilitative approach can help break impasses. The article also provides value by providing a glimpse into what the commercial clients of mediation are looking for in a mediator.

California: Unconscionable to provide arbitration agreement to dancers while "mostly naked"

Sean Pon, an attorney with Hinshaw & Culbertson LLP, writes in JDSupra that a California federal court recently held that an arbitration agreement was unenforceable because of procedural and substantive unconscionablilty concerns. The opinion, Roe v. SFBSC Management, LLC, No. 14-03616 (N.D. Cal. March 2, 2015), holds that the parties had unequal bargaining power and that exotic dancers had no real chance to negotiate the agreement and had no meaningful choice but to sign the agreement. The dancers, according to the court, were presented the contracts "while mostly naked" and they were rushed, or felt rushed, to sign the agreement. The court also found that the arbitration agreement was unconscionable because of a one-way ban on collective actions and cost-shifting clauses of the agreement. Ultimately, the court struck the entire contract. Mr. Pon suggests that arbitration agreements must contain mutual provisions, must be fairly presented to employees, and the employees must have the opportunity to ...

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Texas: Published advertisement isn't a sanctionable violation of the ADR statute

In The Orchards on the Brazos, LLC v. Stinson, the Fort Worth Court of Appeals was asked to decide whether an advertisement placed in a local newspaper that outlined a settlement offer violated the Texas ADR statute. According to the court's opinion, after mediation and a trial, one of the parties took out an ad in a local newspaper that included statements about the settlement negotiations, including language that "At one point we turned down an offer of 100k from the developer." The other party filed a motion for sanctions, arguing that the settlement offer was a confidential communication defined by the Texas ADR statute. The trial court agreed to sanctions and awarded $5,000.00. The advertisement was not made during mediation nor in the presence of a third-party facilitator. According to the Court of Appeals, the advertisement was not subject to the confidentiality requirements of the Texas ADR statute, and, accordingly, wasn't sanctionable. H/T to Ronnie Hornberger for informing us of this opinion. ...

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  1. Re: Welcome to the SBOT ADR Section's Blog.

    Great job to all on this blog, I think it will be a great resource for the latest developments for the...

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