Volume 12, Issue 2 - June 2014

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VOLUME 12, ISSUE 2: CASE SUMMARY

Martinez v. Carnival Corp., 744 F.3d, 1240 (11th Cir. 2014)

Overview:

The Plaintiff, a Honduran citizen who worked on a cruise ship, sustained a back injury while employed aboard the Carnival cruise ship Fascination.  As an employee of the ship and cruise line, he was scheduled to work ten hours per day, seven days a week, with work that involved intense labor.  A term of his employment contract dictated that all disputes, outside of wage disputes, would be referred to and final resolved by arbitration.  The Plaintiff reported back pain to his supervisor and, eventually, the Defendant paid for the Plaintiff to have back surgery in Panama.  Post-surgery, the Plaintiff still experienced serious orthopedic and neurological problems.  The Defendant, once again, paid for medical treatment for the Plaintiff in Miami.

The Plaintiff brought suit in Florida state court.  The Defendant subsequently removed the case to federal district court and filed a motion to compel arbitration, per the terms of the employment agreement.

Holding:

The Eleventh Circuit Court of Appeals affirmed the district court’s decision.  In so doing, the Eleventh Circuit found that the district court’s order compelling arbitration was a final appealable decision.  Whether contract, however, between the Plaintiff and the Defendant had been terminated was subject to arbitration clause found in the employment agreement.  And, the Jones Act negligence claim brought by the Plaintiff for medical negligence was not outside the scope of the arbitration clause found in the employment agreement.

Analysis:

In Martinez, the Eleventh Circuit first considered Carnival’s argument that the appellate court did not, in fact, possess the jurisdiction to even contemplate the order compelling arbitration because it was a non-appealable decision.  The Eleventh Circuit explored whether the litigation itself ended on the merits and left nothing more to be considered, as required by the Federal Arbitration Act.  The Federal Arbitration Act holds that a party may appeal a “final decision with respect to an arbitration.”  Because, according to the Eleventh Circuit, the district court had administratively closed the case—thus denying all pending motions as moot—and created a final and appealable decision.

The Eleventh Circuit next explored whether the actual employment agreement between the Plaintiff and the Defendant was terminated and the effects of that termination.  Ultimately, the court acknowledge the employment agreement was terminated when the Plaintiff disembarked the cruise ship.  But, because the arbitration clause of the employment agreement was, in and of itself, ambiguous as to the length of its survival, the plain language of the arbitration clause tended towards survival of the clause, even past arbitration.  This, then, allowed the district court to properly compel the arbitration of the employment agreement that the Eleven Circuit affirmed in its decision in this case.  The district court noted that there was a federal policy favoring arbitration of labor dispute that the Eleven Circuit, again, found persuasive in its decision to affirm the lower court.

Because the Eleven Circuit affirmed the district court’s decision to treat the employment agreement subject to arbitration, the next question revolved around whether the Jones Act medical negligence claim brought by the Plaintiff would, itself, be subject to arbitration.  The district court and the Eleven Circuit both concluded that the Plaintiff’s dispute and Jones Act claim arose out of—or at least in connection with—the employment agreement.  This subjected the claim to be heard and finalized through arbitration pursuant to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (CREFAA).  Thus, the entire claim would be subject to arbitration rather than the state court claim original brought by the Plaintiff.

Posted in: Volume 12, Issue 2

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