Northwest ADR Conference Call for Participation: 10/31/97 deadline.

Center for Information Technology and Dispute Resolution at U. Mass.

Arbitration Clause Unenforceable Against Title VII Plaintiff Because No
   Consideration Given.
FAA Implied Defenses Can Apply to Arbitration Award Under Convention on the
   Recognition and Enforcement of Arbitral Awards When Award is Made in the
   U.S. or Under U.S. Law.
FAA Preempts State Law Disfavoring Arbitration of Employee's ADA Claim;
   Clause Not Excluded From FAA's Scope.
Member of ERISA Governed Multiemployer Plan Not Required to Pay Entire
   Withdrawal Liability Prior to Arbitration Decision.
Convention Trumps FAA Regarding Whether Consent to Confirm Arbitration Award
   was Necessary.
Arbitration Clauses in Reinsurance Contracts Required Arbitration of Offset
   Issue in Bankrupt Insurer Case.
Corporation Not Required to Arbitrate Under 50% Shareholder's Employment
   Contract with Another Corporation Because Corporate Veil Not Pierced.

Northwest ADR Conference Call for Participation: 10/31/97 deadline.

   The Northwest Alternative Dispute Resolution Conference (Seattle, April
   24-25, 1998) has issued a Call for Participation.  Proposals are due
   October 31, 1997.  Information available by brochure or email from Barbara
   Mercer, bmercer@u.washington.edu, phone 206 616-7429, fax 206 685-3929; or
   from our Automated Document Delivery Service.
   [Call for Participation: Request 297141]

Center for Information Technology and Dispute Resolution at U. Mass.

   The University of Massachusetts Center for Information Technology and
   Dispute Resolution was established in September 1997.  Its focus will be
   managing disputes that arise out of online activities, and assisting
   parties who wish to resolve disputes online.  For details on research, the
   ADRonline monthly, Online Ombuds Office, and more, point your browser to
   http://www.umass.edu/dispute/

Arbitration Clause Unenforceable Against Title VII Plaintiff Because No
Consideration Given.
Gibson v. Neighborhood Health Clinics (7th Cir 8/21/97)

   Declining to decide whether arbitration clauses have to be consented to
   knowingly and voluntarily, the court turned to state contract law to rule
   invalid an arbitration clause the plaintiff had signed.  The court found
   no consideration for the employee's signing the arbitration clause where
   the employee had signed the clause after she had been hired, and the
   employer made no explicit promise to continue the at will relationship at
   the time of signing; the mere continuation of the at-will relationship was
   not sufficient consideration because it was not bargained for. Noting that
   mutual exchanges of promises to arbitrate can be valid consideration, the
   court found none present because the employer made no promise to arbitrate
   all disputes.
   [Full Decision:  Request 297142]

FAA Implied Defenses Can Apply to Arbitration Award Under Convention on the
Recognition and Enforcement of Arbitral Awards When Award is Made in the U.S.
or Under U.S. Law.
Alghanim & Sons v. Toys "R" Us, Inc. (2d Cir 9/10/97)

   Pursuant to an arbitration clause, Toys "R" Us sought a declaration that
   its license and technical assistance agreement with Alghanim & Sons was
   terminated.  The arbitrator disagreed, finding Alghanim & Sons had the
   contractual right to continue opening Toys "R" Us stores in the Middle
   East, and that Toys "R" Us was liable for some $46 million in damages.
   The district court affirmed the award after considering Toys "R" Us's
   argument that the award was clearly irrational and in manifest disregard
   of both the law and the agreement, under the Federal Arbitration Act
   (FAA).  The circuit court approved the District Court's application of the
   FAA, even though the Convention on the Recognition and Enforcement of
   Arbitral Awards clearly applied (because the events took place in the
   Middle East).  After discussing the purpose of the Convention, the court
   held that "the state in which, or under the law of which, the award is
   made, [is] free to set aside or modify an award in accordance with its
   domestic arbitral law ....  However, ... when an action for enforcement is
   brought in a foreign state, the state may refuse to enforce the award only
   on the grounds explicitly set forth in Article V of the Convention."
   Although Toys "R" Us was able to apply its defense under the FAA, the
   court found the award was in manifest disregard of neither the agreement
   nor the law.
   [WESTLAW citation: 1997 WL 560044]

FAA Preempts State Law Disfavoring Arbitration of Employee's ADA Claim;
Clause Not Excluded From FAA's Scope.
Miller v. Public Storage Management, Inc. (5th Cir 9/9/97)

   Miller sued under the ADA; the district court dismissed and sent the case
   to arbitration, pursuant to an arbitration clause Miller signed.  Held:
   Miller was not involved in interstate commerce in the same way seamen and
   railroad workers are, therefore her arbitration clause was not excluded
   from the FAA's scope; the ADA does not prohibit arbitration of ADA claims;
   the circumstances surrounding Miller's signing the clause did not render
   that contract unconscionable; and the FAA preempted a Texas law that
   disfavors arbitration of personal injury or workers' compensation claims.
   [Full Decision:  Request 297143]

 
Member of ERISA Governed Multiemployer Plan Not Required to Pay Entire
Withdrawal Liability Prior to Arbitration Decision.
Chicago Truck Drivers, Helpers and Warehouse Union (Indep.) Pension Fund v.
Century Motor Freight, Inc. (7th Cir 9/9/97)

   Century sold all its assets to another company and stopped making
   contributions to its former employee's pension fund.  Some three years
   later the fund trustee sought payment from Century, which denied liability
   and timely filed for arbitration.  The trustee won summary judgment in
   district court, which required Century to accelerate all payments owed to
   a single lump sum.  Century appealed, arguing that, because it had filed
   for arbitration, it was not liable for accelerated payment.  The 7th
   Circuit reversed, holding that, under ERISA, once an employer files for
   arbitration, it is not liable for accelerated payments, even when it
   misses a payment that is owed.  However, because Century was obligated to
   continue making monthly installments prior to the arbitration, it was also
   liable for liquidated damages on the amount owed to date.
   [Full Decision:  Request 297144]

Convention Trumps FAA Regarding Whether Consent to Confirm Arbitration Award
was Necessary.
McDermott International, Inc. v. Lloyds Underwriters of London (5th Cir
9/2/97)

   McDermott sought coverage under a policy issued by Lloyds.  A panel of
   three arbitrators concluded there was no coverage.  When Lloyds sought to
   confirm the award in district court, McDermott refused to consent.  The
   circuit court held that, since the Convention on the Recognition of
   Foreign Arbitral Awards applied, it trumped the FAA rule requiring consent
   of both parties before an award can be confirmed; where the Convention
   applies and is in conflict with the FAA, the Convention provision
   prevails.  The court also found that Louisiana's statute prohibiting
   mandatory arbitration of insurance disputes did not apply because the
   policy was neither delivered nor prepared for delivery in Louisiana.
   [Full Decision:  Request 297145]

Arbitration Clauses in Reinsurance Contracts Required Arbitration of Offset
Issue in Bankrupt Insurer Case.
Quackenbush v. Allstate Ins. Co. (9th Cir 8/28/97)

   The California Insurance Commissioner, as trustee for insolvent reinsured,
   brought a state suit against reinsurer Allstate to prevent Allstate from
   using amounts owed by the insolvent under one set of contracts to set-off
   the amount Allstate owed the insolvent under a different set of contracts.
   Allstate, in turn, filed a federal suit to compel the trustee to arbitrate
   the dispute--both companies had agreed contractually to arbitrate all
   claims.  The circuit court affirmed the district court's enforcement of
   the arbitration clause, as well as the district court's refusal to enjoin
   the state court proceeding.  The court found the matter well within the
   scope of a valid arbitration agreement and relied on the strong
   presumption in favor of arbitration under the Federal Arbitration Act.
   [Full Decision:  Request 297146]

Corporation Not Required to Arbitrate Under 50% Shareholder's Employment
Contract with Another Corporation Because Corporate Veil Not Pierced.
American Fuel Corp. v. Utah Energy Development Co., Inc. (2d Cir 8/25/97)

   UEDC brought a contract claim against AFC, which employed one of UEDC's
   two shareholders under a contract with an arbitration clause.  In
   addition, the employee brought an employment claim against AFC.  The
   district court ruled that both claims had to be submitted to arbitration
   because the employee was the alter ego of UEDC.  The circuit court
   reversed, finding the corporate veil should not have been pierced.
   [Full Decision:  Request 297147]

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