Chenoweth Law Group

Court decides arbitrator must hear motion

It's a growing trend among companies to have employees and customers sign contracts that include arbitration agreements. In an arbitration agreement, a person usually agrees that any legal matter will be heard by a third-party arbitrator and not a court. One case recent in the Oregon Court of Appeals dealt with an issue involving such an agreement.

According to reports, approximately 2,500 plaintiffs filed a class action suit against a trade school specializing in culinary arts. The suit claimed that the defendant engaged in unfair trade practices and fraud. At the trial court level, the defendants filed a motion to compel arbitration.

The trial court denied the motion. The defendants filed an appeal, seeking to assign error to the trial court for both denying the motion to compel arbitration and to challenge the class. The appeals court rejected the defendants' motion to challenge the class.

The appeals court did agree with the defendant that the trial court erred in denying the motion to compel arbitration. According to documents, approximately 1,060 of the class petitioners signed contracts with the school that did include arbitration agreements. The appeals court noted that the trial court should not have considered the motion at all. The arbitration agreements called for an arbitrator to consider the motion.

When arbitration is at play, especially in a case so big, the manner by which you seek legal remediation can be different. Understanding all the factors that are at play in a case help you understand how to appeal certain decisions; a legal professional can help you understand when appeals might be necessary and can work to appeal issues for you.

Source: Court of Appeals Media Release, "Shannon Gozzi v. Western Culinary Institute, Ltd," Jan. 21, 2016

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