Justia U.S. 1st Circuit Court of Appeals Opinion Summaries

Verizon New England, Inc. ("Verizon") had a collective bargaining agreement (CBA) with Local 2327, International Brotherhood of Electrical Workers, AFL-CIO (the "Union") that was originally signed in 2003. When, in 2008, FairPoint Communications ("FairPoint") purchased Verizon's telecommunication operations in Vermont, New Hampshire, and Maine, FairPoint agreed to hire all former Verizon employees, represented by the Union, in those states. In 2010, the Union filed a grievance against FairPoint based on allegedly wrongful transfer of work. An arbitration panel entered an award against FairPoint, concluding that the facts constituted a wrongful conveyance. FairPoint filed suit in district court, arguing that the arbitral panel had exceeded its authority by wrongfully adding and subtracting terms from the CBA. The district court granted summary judgment in favor of the Union. Nonetheless, the district court denied costs and fees pursuant to Fed. R. Civ. P. 11. The First Circuit Court of Appeals affirmed, holding (1) no grounds existed on which to vacate the arbitral award; and (2) the district court did not abuse its discretion by denying costs and fees. View "N. New England Telephone Operations LLC v. Local 2327, Int'l Brotherhood of Elec. Workers, ALF-CIO" on Justia Law

Plaintiff was a teacher in the Manchester-Essex Regional School District until he was informed by the District Superintendent's intention to terminate his employment for inappropriate sexual conduct toward a student. Plaintiff sought review of the Superintendent's action. An arbitrator affirmed Plaintiff's dismissal. Plaintiff then filed suit in Massachusetts superior court challenging his dismissal and seeking to vacate the arbitrator's decision. Three weeks later, Plaintiff filed this complaint in federal court alleging state and federal law violations. The next day, Plaintiff amended his state-court complaint so it contained the exact same claims as his federal-court complaint. The state court rejected Plaintiff's claims and affirmed the arbitrator's decision. Later, the federal district court granted summary judgment against Plaintiff, finding that Plaintiff's claims were barred by res judicata. The First Circuit Court of Appeals affirmed, holding that none of the reasons presented by Plaintiff why res judicata did not bar his federal claims from adjudication in federal court were persuasive. View "Atwater v. Driscoll" on Justia Law

Defendant in this case was a franchisor and Plaintiffs were its franchisees. After Plaintiffs sued Defendant, the district court certified a class, excluding those franchisees whose agreements with Defendant contained clauses expressly requiring arbitration. While those franchisees pursued arbitration, the arbitrator imposed a stay of the arbitrations of ten of those franchisees. The district court later concluded that Defendant had violated an order requiring it to obtain judicial permission before making any motion to delay or prevent arbitration proceedings and sanctioned Defendant by admitting to the class the ten franchisees, relieving them of their obligations to arbitrate. Defendant then unsuccessfully filed a motion to reconsider the sanction and to stay the ten franchisees' judicial proceedings pending arbitration. The First Circuit Court of Appeals reversed, holding (1) the district court's determination that Defendant violated the order was an abuse of discretion; and (2) therefore, there was no basis for the sanction, and Defendant's motion to stay should have been granted. View "Awuah v. Coverall N. Am., Inc." on Justia Law

Plaintiff terminated Defendant from employment. Thereafter, Defendant began arbitration proceedings seeking severance compensation he felt was contractually due. After arbitration hearings had commenced, the hearings were postponed for two months due to a medical situation afflicting Plaintiff's counsel. During the recess, Plaintiff formally requested pre-hearing and hearing third-party subpoenas directed at Defendant's current employer. The tribunal denied the issuance of the subpoenas. After the arbitration hearings resumed, the tribunal found Defendant was entitled to compensation pursuant to the terms of his employment agreement dealing with his termination without cause. The tribunal also found Defendant was entitled to pre-award interest. Plaintiff subsequently sought vacatur of the award, which the trial court denied. The First Circuit Court of Appeals affirmed, holding (1) the arbitration tribunal did not engage in misconduct by denying the issuance of the pre-hearing and hearing subpoenas; and (2) the tribunal did not exceed its authority in awarding pre-award interest to Defendant. View "Doral Fin. Corp. v. Garcia-Velez" on Justia Law

Plaintiffs in this consolidated interlocutory appeal were defaulted mortgagors of Rhode Island real estate. Defendants were the corresponding mortgagees, Plaintiffs' agents or assignees, who allegedly held Rhode Island mortgagees' legal titles and asserted the right to foreclosure for default on mortgage terms. Plaintiffs brought this action alleging that the ostensible assignments of their mortgagees' legal titles were invalid, leaving the assignees without the right to foreclose. The district court imposed a stay in the nature of a preliminary injunction against foreclosure and possessory proceedings and appointed a special master to mediate the claims. Defendants appealed and filed a mandamus petition, claiming that the district court erred in failing to provide notice and hearing before issuing the stay and in failing to set limits of time and cost when referring the mortgagors' cases to the special master. The First Circuit Court of Appeals remanded with instructions to hold a prompt hearing with reasonable notice on the question of whether the injunction should be continued and to establish specific limits of time and expense if the reference for mediation was to remain in effect. View "In re Mortgage Foreclosure Cases" on Justia Law

This federal case sought confirmation of an arbitration award made at the first, non-liability stage of arbitration as to a contract, and which was filed approximately one month after the arbitral opponents had filed a petition in the Puerto Rico Court of First Instance to vacate the same award. The underlying arbitration resulted from the non-renewal of a sub-distribution agreement between V. Suarez & Co. (VSC) and Bacardi Caribbean Corporation (BCC). The federal district court dismissed the case for lack of subject-matter jurisdiction, finding that an absent party, Bacardi Corporation (BC), was an indispensable party whose joinder would destroy complete diversity. The First Circuit Court of Appeals reversed, holding (1) the federal district court engaged in an incomplete Fed. R. Civ. P. 19(a) analysis, its conclusions under Rule 19 were wrong, and therefore, the proceeding should not have been dismissed for lack of jurisdiction; and (2) the federal court should stay its hand where the Court of First Instance confirmed the award and that decision had been pending on appeal in the court of appeals since August 22, 2012. Remanded. View "Bacardi Int'l Ltd. v. V. Suarez & Co." on Justia Law

This appeal involved litigation between Coverall North America, Inc. and its franchisees. Proceeding under federal diversity jurisdiction, the franchisees asserted a variety of state-law claims against Coverall. Which of the various plaintiffs were subject to the arbitration provisions of the Franchise Agreement was at issue in this appeal. Appellees were a subgroup of Plaintiffs who became Coverall franchisees by signing consent to transfer agreements, which by reference incorporated under franchise agreements that contained arbitration clauses. The district court determined that Appellees did not have to arbitrate their claims against Coverall because they did not have adequate notice of the arbitration clauses contained in the franchise agreements. The First Circuit Court of Appeals reversed, holding that the district court erred because (1) Massachusetts law, which governed this dispute, did not impose any such special notice requirement upon these commercial contractual provisions; and (2) in any event, any special notice requirement would be preempted by the Federal Arbitration Act. View "Awuah v. Coverall N.A., Inc. " on Justia Law

This insurance coverage dispute arose from charges of sexual harassment brought by a one-time employee against Appellant, the former president of Jasmine Company, Inc. Appellant sought a defense to and indemnity for the harassment claims from Appellee, Jasmine's liability insurance provider. The district court ruled that Appellant was not entitled to coverage from Appellee because, under the doctrine of issue preclusion, a prior arbitration between Appellant and the purchaser of his business conclusively established that Appellant's conduct fell within an exclusion to Appellee's insurance policy. The First Circuit Court of Appeals affirmed, holding (1) the arbitration presented Appellant with the full and fair opportunity for adjudication on the issue at hand; and (2) therefore, the district court was correct to bar Appellant from disputing the applicability of the exclusion based on the doctrine of issue preclusion. View "Manganella v. Evanston Ins. Co." on Justia Law

A pipeline owner and a natural gas supplier entered into a contract for the transportation of the supplier's natural gas. The parties later became embroiled in a dispute and submitted their dispute to binding arbitration. After the arbitrators issued a decision largely favorable to the supplier, the pipeline owner sought to vacate the decision in the district court. The district court entered judgment in favor of the supplier. The First Circuit Court of Appeals affirmed, holding (1) the arbitration panel's decision to make the pipeline owner by for the lateral costs was not in manifest disregard of the law; and (2) the panel did not compromise on the matter of the destination-end heating costs, which it imposed on the supplier for the future but declined to make the ruling retroactive; and (3) even assuming that the arbitrators committed misconduct by considering in their decision two documents among the three that the panel attached to its written decision, the misconduct could not have been prejudicial. View "Bangor Gas Co., LLC v. H.Q. Energy Servs. (U.S.) Inc." on Justia Law

Gove worked for TDC, which had a contract with Loring. TDC employees were informed that CSD had been awarded the Loring contract and would be providing services previously furnished by TDC. Gove applied online for a CSD position, similar to the one that she held with TDC. The application included a provision that any dispute with respect to any issue prior to employment, arising out of the employment process, would resolved in accord with the Dispute Resolution Policy and Arbitration Agreement adopted by CSD for its employees. When Gove was interviewed by CSD, she was visibly pregnant and was asked whether she had other children. Gove was not hired, although CSD continued to have a need for the position and continued to advertise the position. Gove filed a complaint with the Maine Human Rights Commission, which found reasonable grounds, but was unable to persuade the parties to reach agreement. She sued under Title VII of the Civil Rights Act, 42 U.S.C. 2000e, and the Maine Human Rights Act. CSD moved to compel arbitration. The district court found that the arbitration clause was ambiguous as to whether it covered an applicant who was never hired and should be construed against CSD. The First Circuit affirmed. View "Gove v. Career Sys. Dev. Corp." on Justia Law