“The Supreme Court should not encourage plaintiffs to breach their contracts by incentivizing those breaches.”
—John Masslon, WLF Senior Litigation Counsel
Click here for WLF’s brief.
WASHINGTON, DC—Washington Legal Foundation (WLF) today filed an amicus curiae brief urging the U.S. Supreme Court to hold that a plaintiff must comply with her contract and arbitrate the parties’ dispute. The Eighth Circuit correctly held that she must comply with the contract she signed. But, presenting a misleading question, she asks the Supreme Court to overturn that decision.
The appeal arises from the breach of a normal employment contract, which provided that the parties would resolve any wage-and-hour disputes through arbitration. Rather than comply with the contract, the plaintiff filed a putative class-action lawsuit in Iowa federal court. After the District Court denied a motion to stay and mediation failed, Sundance moved to compel arbitration. But the District Court denied the motion because Sundance did not immediately move to compel arbitration after the plaintiff sued. The Eighth Circuit reversed and held that the plaintiff needed to show that she was prejudiced by the delay, which she could not prove.
As WLF’s brief shows, Sundance did not waive its right to arbitrate the parties’ dispute. Rather, the plaintiff’s argument is better viewed as a laches defense. And it is undisputed that to succeed on a laches defense a party must show prejudice. If not laches, then the plaintiff’s argument is one of forfeiture or estoppel-by-silence. As with a laches defense, to win on either theory the party must show prejudice, which the plaintiff cannot do.
Responding to an amicus brief by a group of activist law professors, WLF’s brief also explains why the Court should not overturn its well-settled precedent that there is a federal policy favoring arbitration. First, the plaintiff forfeited the argument. Second, the stare decisis factors do not support overruling the Court’s precedent. Finally, even if the Court were writing on a blank slate the Court should hold that there is a federal policy favoring arbitration.
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