Employment exclusion reviewed

Supreme Court and Arbitration


SUPREME COURT & ARBITRATION: The U.S. Supreme Court heard argument in the Circuit City v. Adams case on Monday, concerning Section 1’s “contract of employment” exclusion. The Ninth Circuit gave a broad reading to the exclusionary provision in the decision below, holding that virtually all employment contracts are excluded from the Federal Arbitration Act’s coverage.

According to the New York Times’ Linda Greenhouse, the justices’ response to the arguments seemed to favor affirmance. That would be a surprise to all of the federal circuits besides the Ninth, but it would not mean a rejection of the arbitration provisions in those employment contracts. It would mean that state arbitration statutes would apply in employment disputes. That might make the law on employment arbitration a hodgepodge, but it would also give greater importance to the new Revised Uniform Arbitration Act.

Meanwhile, the court recently denied review in a couple of securities arbitration-related cases: Nixon v. Merrill Lynch (Dkt. No. 00-317, denied 10/30), in which the Eighth Circuit told the Missouri Human Rights Commission it could not pursue an administrative proceeding seeking monetary relief for a Claimant who had lost in arbitration; and Buchignani v. Vining-Sparks (Dkt. No. 00-211, denied 11/6), a case in which the Sixth Circuit refused a broadened manifest disregard standard urged by the EEOC and the discrimination Claimant. We reported on these two decisions in the Securities Litigation Alert; Buchignani in SLA 2000-02, and Nixon (sub. nom. Merrill Lynch v. Mo. Human Rights Commn) in SLA 2000-10.


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