Fifth Circuit Declares that Arbitrability of Dispute is to be Determined by Arbitraton Panel

Allen v. Regions Bank

(5th Cir., August 11, 2010)


Minnie and Kenneth Allen obtained a home equity loan from First American National Bank in October 1999. First American withheld funds from the loan to purchase credit life and disability insurance. In December 1999 AmSouth Bank became the successor to First American. In 2001, the Allens opened a deposit account with AmSouth. An agreement signed by the Allens in conjunction with opening their deposit account required arbitration of all disputes relating to any account

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Professional Relationship Between Arbitrator’s Wife and Defense Counsel Not Ground to Vacate Arbitration Award

Johnson v. Gruma Corp.

(9th Cir. (Cal.) Aug. 13, 2010)


The Ninth Circuit recently refused to vacate an arbitration award on the ground that the arbitrator failed to disclose his wife’s former professional relationship with the law firm ultimately retained to represent the defendant in the arbitration.


The plaintiff filed suit against Gruma Corporation in 2001, alleging that Gruma misrepresented to the plaintiff and other class members that they were independent contractors when they were, in fact, Gruma employees. The complaint contained

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Dismissal of Lloyd’s Suit for Lack of Subject Matter Jurisdiction Reversed

Underwriters at Lloyd’s, London v. Carol Osting-Schwinn

(11th Cir. (Fla.) August 5, 2010)


Carol Osting-Schwinn’s son was riding a dirt bike when it collided with an all-terrain vehicle driven by Michael Rockhill, who was insured by a policy underwritten at Lloyd’s.  Osting-Schwinn and the underwriting syndicates at Lloyd’s agreed to settle the case and the syndicates sent settlement checks, affidavits and a copy of the policy.  Osting-Schwinn rejected the settlement, claiming the syndicates failed to properly disclose information about other known

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Supremacy Clause and Federal Arbitration Act Supersedes Michigan Statute Prohibiting Out-of-State Arbitrations

Binder v. Medicine Shoppe International, Inc.

(E.D.Mich. July 20, 2010)

In a dispute between a franchisor and the franchisee, the franchisee sought to arbitrate.  The relevant agreement between the parties was entered into in Michigan and provided that the parties would arbitrate any disputes in Missouri.  In a separate document, Michigan's law prohibiting out of state arbitrations was set forth. 

The franchisee sought to arbitrate in Missouri.  The individual shareholders of the franchisor, participated as representatives of the franchisor, but not insisted they did not

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Applying Supreme Court’s Standard in Hall Street, District Court Rejected Claims That Arbitration Panel Manifestly Disregarded The Law

International Brotherhood of Teamsters, Local 701 v. Stroehmann Bakeries,(D.N.J. June 22, 2010)

Local 701 and Stroehmann entered into a collective bargaining agreement (“CBA”) which, among other things, prohibited private agreements between Stroehmann and its employees and provided instead that all agreements must be between Stroehmann and Local 701. John Cash, a Stroehmann employee and member of Local 701 was terminated for poor attendance. Cash was diagnosed with cancer. Stroehmann entered into a “last chance agreement” (“LCA”) with Cash whereby Cash was permitted to return to

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11th Circuit Compels Arbitration in Contract Dispute Between Bank and Law Firm Despite Contention that Bank Waived its Right to Elect Arbitration by Participating in the Action

Citibank v. Stok & Assoc.

(11th Cir. [FL], July 20, 2010)

In an action for breach of contract and breach of fiduciary duty by a law firm against a bank, the bank sought to compel arbitration pursuant to the terms of the contract governing their banking relationship.  The law firm had deposited a client’s cashier’s check into its account with the bank.  After the bank accepted the check and made the funds available, it discovered that the check was counterfeit and restricted

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Relying on the Supreme Court’s holding in Stolt-Nielsen, Second Circuit Determines that Class Arbitration Clause is Unconscionable

Fensterstock v. Education Finance Partners, et al.

(2nd Cir. (N.Y.) July 12, 2010)


Plaintiff commenced this action asserting state law claims on behalf of himself and others similarly situated, alleging that defendants engaged in fraudulent and deceptive practices in connection with the solicitation, consolidation, and servicing of student loans.  Plaintiff alleged that defendants intentionally failed to disclose to borrowers that unless their payments were received on the precise day of the month on which they were due, defendants would alter the Amortization

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Fourth Circuit Determines That Legally Objectionable Behavior By Counsel Is Not Enough To Overturn Arbitration Award

MCI Constructors v. City of Greensboro

4th Cir. (N.C.), July 1, 2010


This appeal arises from a contract dispute concerning the construction of a wastewater treatment plant.  All concerned parties agreed to submit to an arbitration which yielded an award to defendant.  The district court then granted the defendant’s motion to confirm this award and this appeal followed.  Plaintiffs claims, among other things, that the district court should have vacated the awards because the liability award was obtained through undue

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Sixth Circuit Determined that Bank Waived Arbitration Agreement By Actively Litigating Dispute

Hurley v. Deutsche Bank Trust Company

(6th Cir. (Mich.) July 1, 2010)


The mortgagor received a loan from the lender and executed a mortgage on the property.  A rider entitled "Arbitration of Disputes" was attached to the mortgage.  It required that all disputes between the parties be arbitrated.  Sometime thereafter, the mortgagor, who was a member of the National Guard, was called up for service in Iraq. While he was gone, the property was foreclosed. 

The mortgagor filed suit in

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Connecticut Appellate Court Confirms Propriety of Remanding Case to Arbitration Panel for Clarification Rather than Vacating Award

Hartford Steam Boiler Inspection and Ins. Co. v. Underwriters at Lloyd’s

(CT App. May 11, 2010)

An insurance company sought to vacate an arbitration award surrounding an explosion at a coal fired electrical generating facility in Arkansas caused more than $28 million in damage.  The owners of the facility submitted claims to its insurance providers, the parties to the arbitration. Hartford provided a policy of boiler and machinery insurance and Lloyd’s provided "all risks" property insurance for the policyholder.  Both insurers denied coverage.

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