Review Granted: Goodman v. Lozano
Opinion Due Tomorrow re Release of Non-Waivable Labor Code Rights

Another Pitfall of Arbitration

Check out the 4th Circuit's decision earlier this year in Long John Silver's Rests. Inc. v. Cole, No. 06-1259 (4th Cir. 2008). The plaintiffs brought an FLSA "class action" which ended up in arbitration rather than U.S. District Court, where it would have properly treated it as an opt-in FLSA "collective action." The arbitrator ruled that the class action arbitration should be "opt-out," and the 4th Circuit affirmed the arbitrator's decision.

It happens to everyone, sooner or later. In one of our cases, at the arbitration scheduling conference, the defense counsel tried to argue that only a very limited sampling of records should be produced prior to certification, and even though we didn't ask for everything, the arbitrator decided that a sampling of 100% might be more appropriate. As my daughter would describe it, “The defense guy was all like ‘arbitration is not supposed to be about random truckloads of documents’, and the judge was all like 'you get those, oh yeah you do, nothing random, you get them all, the time records, the lists, the manuals, you get all those'. And we were all like 'w00t'." So we got an order compelling a non-random production of every last truckload of documents. Decision final. That probably was not what they had in mind when they filed the petition to compel arbitration.

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