Justia U.S. 10th Circuit Court of Appeals Opinion Summaries

Defendants-Appellants Chesapeake Exploration, L.L.C., and Chesapeake Investments appealed a district court judgment awarding Plaintiff-Appellee BP America Production Company $22,265,302 plus interest, and a district court order compelling Chesapeake to pay $1,403,669.38 in attorneys' fees and disbursements. BP cross-appealed the district court order confirming an arbitration award. This dispute arose out of a purchase and sale agreement ("PSA") entered into by Chesapeake as seller and BP as purchaser of oil and gas properties for $1.75 billion. The PSA contained three arbitration provisions. After closing, the parties agreed on title defects. Less the aggregate threshold, the parties agreed BP was owed $81,234,556. At the same time, disputed title defects and benefits were submitted to title arbitration. BP sought approximately $46 million for disputed title defects, and Chesapeake sought approximately $22 million for disputed title benefits and "credits." While the title arbitration was pending, BP submitted a proposed final accounting statement reflecting the agreed title defects of approximately $80 million. Chesapeake responded with an exception report changing the $80 million to $58 million. When BP asked why, Chesapeake responded that it had applied a $22 million offset based on its pending claims in the title arbitration; Chesapeake did not dispute the $80 million in agreed title defects, but temporarily withheld the $22 million because it might recover that amount in title arbitration. Though the accounting arbitration ended, the title arbitration continued. The arbitration panel issued an award finding $11,526,434 in title defects (favoring BP), and $3,727,031 in title benefits (favoring Chesapeake). The arbitration panel noted that it made no determination of whether these amounts exceeded the aggregate threshold, or whether its ruling would actually cause any money to exchange hands. If the parties could not agree on the effect of the panel's ruling on the ultimate purchase price adjustment, they could submit their positions on that issue to further arbitration. Shortly thereafter, BP requested payment from Chesapeake. Because a $3 million in title benefits awarded to Chesapeake did not exceed the aggregate threshold, Chesapeake received no price adjustment to offset the $22 million it previously withheld. The parties filed competing motions to confirm in the district court. The court ultimately entered judgment in favor of BP for $22,265,302 plus interest. Chesapeake appealed that judgment. The district court later granted in part BP's motion for attorneys' fees and costs and awarded $1,403,669.38 against Chesapeake for fees and disbursements. Chesapeake appealed that judgment too. Upon review of the matter, the Tenth Circuit affirmed both awards in Chesapeake's direct appeals and dismissed BP's cross-appeal. View "BP America Production Company v. Chesapeake Exploration, LLC, et al" on Justia Law

The issue this case presented to the Tenth Circuit on appeal involved involves a dispute concerning the scope of an arbitration clause between Nitro-Lift Technologies, L.L.C. and three of its former employees, plaintiffs Miguel Sanchez, Shane Schneider, and Eddie Howard. Plaintiffs sued Nitro-Lift, claiming it failed to pay overtime wages in violation of both the Fair Labor Standards Act (FLSA), and the Oklahoma Protection of Labor Act (OPLA). Nitro-Lift appealed two district court orders denying its motions to dismiss and compel arbitration, or in the alternative to stay the proceeding pending arbitration, arguing plaintiffs' wage disputes fell within the scope of the arbitration clause. The Tenth Circuit agreed with Nitro-Lift's argument with respect to the wage disputes and arbitration, and as such, reversed the district court's denial of Nitro-Lift's motion to compel arbitration. The case was remanded for further proceedings. View "Sanchez, et al v. Nitro Lift Technologies" on Justia Law

Plaintiff-appellee Randy Howard sought to bring a class action suit against Ferrellgas Partners, LP in federal district court for allegedly overcharging him and other customers. Ferrellgas moved to force plaintiff to pursue his individual claim alone, in arbitration, arguing that arbitration was the procedure the parties had agreed to. The district court was unable to conclude that the parties agreed to arbitrate. Rather than proceed to trial as the Federal Arbitation Act required, the district court entered an order denying arbitration outright. The Tenth Circuit concluded that denial was error: "When it's apparent from a quick look at the case that no material disputes of fact exist, it may be permissible and efficient for a district court to decide the arbitration question as a matter of law through motions practice and viewing the facts in the light most favorable to the party opposing arbitration. . . . Parties should not have to endure years of waiting and exhaust legions of photocopiers in discovery and motions practice merely to learn where their dispute will be heard. The Act requires courts process the venue question quickly so the parties can get on with the merits of their dispute in the right forum. It calls for a summary trial — not death by discovery." View "Howard v. Ferrellgas Partners, et al" on Justia Law

The United Food and Commercial Workers International Union, Local No. 7 sued King Soopers, Inc. to enforce an arbitration award. The federal district court ruled that the award did not stem from the Union’s collective bargaining agreement (CBA) with King Soopers and refused to enforce it. The Tenth Circuit reversed, finding that although King Soopers could have brought a timely action to vacate the award on the ground adopted by the district court, it did not do so. It therefore could not raise that defense against the Union’s action to enforce the award. For the same reason, the Court held that King Soopers could not raise the defense that the arbitrator lacked authority to impose a remedy. View "United Food & Commercial v. King Soopers" on Justia Law

THI of New Mexico at Hobbs Center, LLC and THI of New Mexico, LLC (collectively THI) operate a nursing home in Hobbs, New Mexico. When Lillie Mae Patton's husband was admitted into the home, he entered into an arbitration agreement that required the parties to arbitrate any dispute arising out of his care at the home except claims relating to guardianship proceedings, collection or eviction actions by THI, or disputes of less than $2,500. After Mr. Patton died, Mrs. Patton sued THI for negligence and misrepresentation. THI then filed a complaint to compel arbitration of the claims. The district court initially ruled that the arbitration agreement was not unconscionable and ordered arbitration. Under New Mexico law a compulsory-arbitration provision in a contract may be unconscionable, and therefore unenforceable, if it applies only, or primarily, to claims that just one party to the contract is likely to bring. The question before the Tenth Circuit was whether the Federal Arbitration Act (FAA) preempted the state law for contracts governed by the FAA. The Court held that New Mexico law was preempted in this case and the arbitration clause should have been enforced. View "THI of New Mexico at Hobbs v. Patton" on Justia Law

Plaintiff Air Method Corporation terminated a helicopter pilot, Jeff Stackpole, following a 2010 incident. Defendant Office and Professional Employees International Union Local 109 (OPEIU) represented Mr. Stackpole throughout the arbitration process. After the arbitration award was granted in Mr. Stackpole’s favor, Plaintiff filed a complaint against OPEIU Local 109 pursuant to the Railway Labor Act, seeking to vacate the award. On cross-motions for summary judgment, the district court ruled in favor of Defendants, thereby upholding the arbitration award. Plaintiff appealed the district court’s decision. Finding no reversible error, the Tenth Circuit affirmed the arbitration award. View "Air Methods Corporation v. OPEIU, et al" on Justia Law

Qwest Corporation and Qwest Broadband Services, Inc. appealed a district court order granting partial summary judgment. After Richard Grosvenor filed a putative class action, Qwest moved to compel arbitration under the Federal Arbitration Act. The district court denied Qwest’s motion and scheduled a trial to determine whether the parties had reached an agreement to arbitrate. Both parties then moved for partial summary judgment. The district court granted both motions in a single order, concluding that the parties entered into an agreement, but that the agreement was illusory and unenforceable. On appeal to the Tenth Circuit, Qwest argued that the Tenth Circuit had jurisdiction to review the district court's order. Finding that in order to invoke appellate jurisdiction under the FAA, Qwest did not satisfy the Act's criteria by either explicitly moving to stay litigation and/or compel arbitration pursuant to the FAA, or making it unmistakably clear from the four corners of the motion that the movant sought relief provided for in the FAA. Accordingly, the Court dismissed Qwest's appeal. View "Grosvenor v. Qwest Corporation, et al" on Justia Law

Avaya Inc. ("Avaya") appealed a district court's ruling compelling arbitration of its labor dispute with the Communication Workers of America ("CWA") over the legal status of a class of Avaya employees called "backbone engineers." The union viewed the backbone engineers as non-represented "occupational" employees and legitimate objects for its organizing campaigns, while Avaya saw them as managers outside the scope of the company's labor agreements. CWA contended the parties' collective bargaining agreement ("CBA") required any dispute over the status of backbone engineers to be resolved in arbitration. Avaya maintained the parties did not consent to arbitrate the status of its backbone engineers and accused CWA of trying to unilaterally enlarge the CBA to encompass disputes over company management. Having reviewed the CBA and the evidence submitted to the district court, the Tenth Circuit agreed with Avaya's position and reversed the district court's order compelling arbitration. View "CWA v. Avaya, Inc." on Justia Law

San Juan Coal Company and the International Union of Operating Engineers Local 953 entered into binding arbitration to determine whether union members on a certain schedule were entitled to holdover pay. The arbitrator concluded that the union members were entitled to the extra pay, but on review, the district court overturned the arbitral award. Because the arbitrator’s interpretation was colorable, the Tenth Circuit held that the district court improperly substituted its interpretation of the agreement: "[a]n arbitrator's interpretation of an agreement, even one that is flawed or based on questionable findings of fact, is due the utmost judicial deference. It matters not that a reviewing court might offer a more cogent reading of the agreement; the arbitrator's interpretation must be upheld wholly unless it is without any textual basis." View "San Juan Coal Co. v. Int'l Union of Operating Engineers Local 953" on Justia Law

Plaintiff-Appellant Dennis Cornwell brought a wrongful death action on behalf of his wife who died at a railroad grade crossing when the vehicle she was driving hit a locomotive owned and operated by Defendant Union Pacific Railroad Company. Union Pacific moved for summary judgment and also moved to exclude the testimony of Plaintiff's four experts based on "Daubert v. Merrell Dow Pharmaceuticals, Inc." (509 U.S. 579 (1993)). The district court granted the summary judgment motion in part and ruled that the testimony of three experts should be excluded. The case proceeded to a jury trial. At its conclusion, the jury entered a verdict in favor of Union Pacific. Plaintiff appealed seeking to overturn the pre-trial rulings. Finding that the district court's ruling was supported by Tenth Circuit precedent and case law from other circuits, the Tenth Circuit affirmed the lower court's decision: "[t]he district court determined that [Plaintiff's experts'] proffered evidence was unreliable under "Daubert" standards: their evidence was speculative and conclusory." The Court therefore affirmed the exclusion of the experts' testimony and the grant of summary judgment in favor of the railroad. View "Cornwell v. Union Pacific Railroad Co." on Justia Law