The legal and ethical implications of mandatory arbitration provisions have been the subject of much discussion over the past few years. Recently, the U.S. Supreme Court issued an opinion in an arbitration case. While the case involves an employment arbitration agreement, the case is relevant to Maryland nursing home cases insofar as it illuminates the Court’s general position on arbitration agreements. Especially interesting is Justice Ginsburg’s dissent to the Court’s opinion.
The case involved a dispute between an employee and his employer, after the employer released the employee’s personal information in response to a phishing scam. Prior to his employment, the employee signed an arbitration agreement. Nowhere in the arbitration agreement was the possibility of a class-action discussed.
After the employee filed a lawsuit against his employer, intending to form a class-action lawsuit against the employer, the employer argued that the arbitration agreement compelled bilateral arbitration, or arbitration between a single employee and the employer.
The lower court determined 1.) that the contract was one of adhesion, and 2.) that the contract was ambiguous as to whether it permitted class-action lawsuits. Thus, the court construed any ambiguity against the employer, allowing the employee to continue with his claim. The employer appealed to the U.S. Supreme Court, which reversed the lower court’s opinion. In a 5-4 opinion, the Court held that under the Federal Arbitration Act, an ambiguous agreement does not provide the necessary contractual basis to compel class arbitration.
The Court’s opinion, authored by Chief Justice Roberts, is based on the issue of consent. The Court’s position was, if employees sign an arbitration agreement, they must have consented to all its terms, and as a result, are bound by those terms. However, Justice Ginsburg argues in her dissent that the Court’s definition of consent is a stretch, noting that the employees were told if they did not sign the agreement their employment would be terminated. Being presented with the arbitration agreement in such a take-it-or-leave-it manner, Justice Ginsburg points out, presents employees with a “Hobson’s choice” in which they accept the terms of arbitration or give up their job. This, to Justice Ginsburg, does not constitute consent.
Again, this case had nothing to do with nursing home abuse or neglect. However, arbitration agreements are often at the center of Maryland nursing home lawsuits. And, for now, it seems as though the Court is in favor of arbitration – even when the claim being brought is not clearly within the scope of the agreement. Nevertheless, it is important to remember that every case is different and is judged on the specific facts presented.
Are You Being Forced into Arbitration?
If you are being told by a Maryland nursing home that you must arbitrate a dispute rather than file a claim with a court of law, contact the dedicated Maryland nursing home abuse and neglect attorneys at the law firm of Lebowitz & Mzhen, LLC. At Lebowitz & Mzhen, we have extensive experience handling Maryland nursing home lawsuits, including those raising arbitration issues. To learn more about how we can help you fight for your right to be heard in court, call 410-654-3600 to schedule a free consultation today.