While employee contract raised doubts as to whether employees

agreed to arbitrate their wage disputes, all doubts had to be resolved in

favor of arbitrability.

 

Plaintiff employees brought an action relating to overtime wages

against their former employer, Nitro-Lift Technologies, L.L.C. (Nitro-

Lift). The court denied Nitro-Lift’s motion to dismiss and compel

arbitration, and Nitro-Lift subsequently filed an interlocutory appeal.

 

The court held that the arbitration provision was sufficiently broad

enough to encompass the employees’ wage disputes, despite being

contained in a contract labeled “Confidentiality/Non-Compete

Agreement.” The arbitration provision contained no limiting language,

and stated that “[a]ny dispute, difference or unresolved question

between” the parties must be arbitrated. The Plaintiffs emphasized the

narrow context of the agreement in which the arbitration clause was

found, as it discussed only issues relating to competition, confidentiality,

and retention of corporate documents. The court noted that when the

broad arbitration clause was considered together with the entire language

of the narrow contract, an ambiguity was created. However, all doubts or

ambiguities relating to whether the employees agreed to arbitrate their

wage disputes must be resolved in favor of arbitration.

 

 

a. Cummings v. FedEx Ground Package Sys., Inc., 404 F.3d 1258

(10th Cir. 2005) (noting when parties dispute whether an

arbitration clause in a contract applies to a particular type of

controversy, the question is for the court, which held certain

contractor claims did not fall within the scope of the arbitration

provision in operating agreements between courier service and

contractors).

 

b. Landers v. Fed. Deposit Ins. Corp. 739 S.E.2d 209 (S.C. 2013)

(The scope of a broad arbitration clause does not limit arbitration

to the literal interpretation or performance of the contract, but it

embraces every dispute between the parties having a significant

relationship to the contract).

 

 

 

 

 

Cape Flattery, boat owner, sued Titan Maritime, a salvage company,

in federal district court seeking indemnity or contribution for damages to

coral reef caused by salvage of the boat. The parties had an agreement

that Titan Maritime would salvage the boat and the agreement included

an arbitration clause stating that any dispute arising under the agreement

would be settled by arbitration in England and English law would apply.

Titan sought to compel arbitration based on the arbitration clause in the

agreement. The district court concluded that federal arbitrability law

applied to determine arbitrability and that, under federal arbitrability law,

the dispute did not arise under the agreement. Titan appealed.

 

The court of appeals determined that the first issue was what law

should apply to determine the arbitrability of the dispute. The court first

concluded that parties do have the power to agree to apply non-federal

arbitrability law. In determining whether the parties had agreed to apply

non-federal arbitrability law, the court relied on First Options of

Chicago, Inc. v. Kaplan to conclude that courts should apply federal

arbitrability law absent “clear and unmistakable evidence” that the

parties agreed to apply non-federal arbitrability law. 514 U.S. 944, 115.

In the case at issue, the court found that there was no clear and
unmistakable evidence that the parties had agreed to apply English