|
In Barragan v. Washington Mutual Bank, No. C 06-01646-CRB, 2006 WL 2479125 (N.D. Cal. Aug. 28, 2006), a United States district court in California held that an employment dispute was within the scope of an arbitration clause, even if the plaintiff fashioned the proceedings as a putative class action. Washington Mutual Bank (WMB) opposed arbitration of Barragan’s claims for unpaid overtime, but the Court noted the limited role of the judiciary in interpreting arbitration agreements, and compelled arbitration of the remaining “procedural” issues.
In a very similar case, the Ninth Circuit held that an employer’s claims for unpaid wages and overtime under the Fair Labor Standards Act, 29 U.S.C. §201 et seq., were within the scope of an employment clause requiring arbitration of “any dispute, claim, or controversy…arising out of the employment or termination of employment.” Kuehner v. Dickinson & Company, 84 F.3d 316 (9th Cir. 1996). In light of this precedent and the broad language of the arbitration agreement between Barragan and WMB, the Court had no problem deciding that Barragan’s employment claims were arbitrable.
With regard to the class action question, the Court left this issue for the arbitrator. Whether or not class arbitration is permissible is a procedural question based on state contract law. See Green Tree Financial Corp. v. Bazzle, 538 U.S. 401 (2003). Thus, the Court limited its analysis to threshold questions of arbitrability, since purely procedural questions related to the arbitration of the dispute are determined by the arbitrator. Howsam v. Dean Witter Reynolds, Inc., 537 U.S. 79, 84 (2002). The U.S. Supreme Court has indicated, however, that any arbitration agreement explicitly limiting or permitting class treatment would be entirely valid. Bazzle, 538 U.S. at 452-53.
Subscribe to a free weekly update on ADR case law and
legislation
|