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One to Keep An Eye On: Morgan v. Sundance (U.S. Supreme Court)


As with many labor & employment law related cases (and bills) being litigated around the country, there are always a few that stand out.  This is one to keep an eye on.


On November 15th, the U.S. Supreme Court granted a petition for writ of certiorari in a case in which the Court will determine whether litigation of an employment dispute in court prevents the claim from proceeding to arbitration afterward.

(For those unfamiliar with the Supreme Court, the Court traditionally receives over 10,000 petitions for writ of certiorari every term.  A petition for writ of certiorari is the formal request of a party seeking to appeal a ruling from a lower court, such as a court of appeals.  The Supreme Court decides to grant very few petitions, often only selecting 100 petitions or fewer each term.)

In this particular case, Morgan v. Sundance, an employee sued her employer on the grounds that she and other employees were owed overtime.  Despite the employees having signed an agreement to arbitrate employment disputes, this was not directly raised by the employer.  Instead, the employer sought to dismiss the case on other grounds.  The trial court denied that request.  The parties then attended mediation in an effort to resolve the dispute.  After that proved unsuccessful, and approximately eight months after the lawsuit was filed, the employer moved to compel arbitration.  The trial court denied the motion but the Eighth Circuit Court of Appeals reversed.  The Court of Appeals noted that the employees would not be prejudiced by the case being arbitrated as no substantive actions had taken place in the lawsuit, such as discovery being conducted or depositions conducted.  The employees subsequently appealed to the Supreme Court.

At this point, it is far too early to predict how things will play out before the Supreme Court.  With that being said, I am inclined to agree with the lower court in its denial of the motion to compel arbitration.  As a procedural matter, if you do not assert a defense/claim, you often waive it.  Even if you amend a pleading and include the defense/claim at a later point, you still run the risk of having waived it by failing to assert it at the outset.  In this instance, although apparently not much had taken place in the lawsuit (in regard to substantive discovery or litigation), I would tend to find that the employer waived the arbitration provision by failing to assert it until nearly eight months after the lawsuit was filed.

With that being said, I am not a Supreme Court Justice…let us see what the Court does in this case.


For additional information:  https://www.supremecourt.gov/search.aspx?filename=/docket/docketfiles/html/public/21-328.html

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